May 29, 2008
| Buy Wind | Energy Peak Oil |
Oil billionaire T. Boone Pickens just bought $2 billion worth of wind turbines from GE. Sign of the times. The Street (via Cryptogon):
Mesa Power, a company run by well-known energy investor T. Boone Pickens, has ordered nearly 700 wind turbines from GE as part of its plans for a giant wind farm in Texas.The company placed a $2 billion order for 667 turbines for the Pampa Wind Project, which will ultimately provide more than 4,000 megawatts of electricity, or enough for more than 1 million homes. The project will be completed in four phases.
Mesa will start getting the turbines in 2010 and 2011.
Pickens, who became rich in the fossil fuels game, has been interested in alternative energy for some time, and with oil prices hitting record highs above $125 a barrel, the audience for his message is growing. [...]
Warren Buffett, the head of Berkshire Hathaway and another of the nation's wealthiest investors, has also been investing in wind.
Handwriting on the wall.
Posted by Jonathan at 10:39 PM
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May 06, 2008
| Miscellany | Peak Oil Politics |
BookForum has a lengthy excerpt from Rick Perlstein's new book, Nixonland. For anyone who remembers 1972 and the McGovern campaign, it's a fascinating read.
Meanwhile, oil hit $122 a barrel today. It's remarkable how little talk there is in the mainstream, still, about the permanence of the trends that have brought this about. It's as if people think it's a temporary blip — a little gas tax holiday and it'll all blow over.
Posted by Jonathan at 05:31 PM
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April 22, 2008
| Has Russian Oil Production Peaked? | Peak Oil |
This is one of those stories that probably ought to be front page news all over the world. Oil production in Russia, the world's largest oil producer, declined in Q1 for the first time in a decade. WSJ, from last week:
Russian oil production, for years a vital source of new supplies for world markets, is showing signs of a slump, adding to uncertainties that have helped push oil prices to record highs.Russian output fell for the first time in a decade in the first three months of this year, according to the International Energy Agency, which represents industrialized oil-consuming countries. It said Russian production averaged about 10 million barrels a day, a 1% drop from the first-quarter of 2007.
Declining production from the world's largest oil producer and one of its largest exporters puts further pressures on an already strained market and adds to the potential for higher prices for a global economy coping with a slowdown. Global production constraints -- along with surging demand, rising oil-field expenses and political instability in petroleum-rich regions -- already have sent oil to more than $110 a barrel from $30 in about four years. [...]
Industry watchers and Russian officials generally blame the country's production slowdown on a combination of weather and tight electricity supplies in some parts of the country. In a longer-term worry, they also point to aging Siberian fields that once fueled its production growth. [...]
The IEA predicts Russian oil production will resume growth this year. But it estimates an annual increase of only 0.8% over 2007, compared with an average 2.5% in the past three years and much faster growth before that.
Russia's energy ministry expects a rise of 1.8%. But earlier this month, Yuri Trutnev, the nation's natural-resources minister, said on Russian television that the country's full-year production may be lower than last year's.
Russia's stumbling production growth highlights a troubling reality: Despite soaring oil prices in the past five years, crude output from nations outside the Organization for Petroleum Exporting Countries has remained essentially flat since 2005, defying the normal link between high prices and increased production. [...]The reasons for the non-OPEC plateau range from spiraling exploration costs to the increasingly remote climates where new oil pockets are being found. Also, many major sources are aging. Europe's North Sea, Alaska's Prudhoe Bay and Mexico's Cantarell field in the Gulf of Mexico have all seen declining output.
New oil pockets are being found in "increasingly remote climates" because that's all that's left. That's what peak oil looks like.
Various other news stories, like this one in the Financial Times, cite all sorts of temporary reasons why Russian output is slumping. But look at that graph. It looks like your basic Hubbert peak. Whether it is or not, time will tell.
As I write this, oil is at $118.35 a barrel.
Posted by Jonathan at 04:54 PM
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March 10, 2008
| 107 | Peak Oil |
As I write this, oil has climbed to $107.35 a barrel, and the dollar has fallen to 1.5336 against the euro (i.e., it now takes more than $1.53 to buy what a euro buys). No end in sight.
Posted by Jonathan at 12:22 PM
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February 26, 2008
| Slip-Sliding Away | Economy Peak Oil |
The price of oil today set a new all-time record — again. It currently sits at $100.88 per barrel.
In related news, the dollar today fell to a new all-time record low against the euro — again. It currently sits at 1.5014 (i.e., it now costs more than a buck and a half to buy what a euro buys).
Oops.
Posted by Jonathan at 05:35 PM
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February 19, 2008
| Oil Price Sets New Record | Peak Oil |
AP:
Oil prices hit new record highs Tuesday as a Texas refinery fire and fears of an OPEC production cut pushed crude to settle at over $100 a barrel for the first time ever.U.S. crude for March delivery jumped $4.51 to settle at $100.01 a barrel on the New York Mercantile Exchange, topping the previous settlement record of $99.62 set Jan. 2.
Oil also hit a new all-time trading high of $100.10 a barrel, besting the previous high of $100.09 set Jan. 3.
Posted by Jonathan at 02:54 PM
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February 08, 2008
| With A Fountain Pen | Corporations, Globalization Energy Peak Oil |
Richard Heinberg (via EnergyBulletin) calls attention to an extraordinary clause in the NAFTA agreement:
There is a strange clause in the North American Free Trade Agreement (NAFTA) that applies to only one country — Canada. The clause states that Canada must continue to supply the same proportion of its oil and gas resources to the US in future years as it does now. That's rather a good deal for the US: it formalizes Canada's status as a resource satellite of its imperial hub to the south.From a Canadian perspective there are some problems with the arrangement, though. First is the fact that Canada's production of natural gas and conventional oil is declining. Second is that Canada uses lots of oil and gas domestically: 70 percent of Canadians heat their homes with gas, and Canadians drive cars more and further than just about anyone else. The problem is likely to come first with natural gas; as production declines, there will come a point when there isn't enough to fill domestic needs and continue to export (roughly 60 percent of Canada's gas now goes to the US).
That point is not decades in the future, it is fairly imminent.
What happens when Canadians can no longer drive their cars or heat their homes because NAFTA forces them to export the oil and gas they need for their own use? Will they say, hey, no problem, we'll just sit here in the dark and cold? Would you?
It's not often discussed, but a key subtext of the push for international trade agreements has been the "developed" nations' desire to lock in access to the rest of the world's natural resources. But sooner or later, push'll come to shove. People in countries that have their own energy resources are going to wonder how their leaders managed to sign away control.
One thinks of the Woody Guthrie song:
Yes, as through this world I've wandered
I've seen lots of funny men;
Some will rob you with a six-gun,
And some with a fountain pen.
In this case, the guys with fountain pens have most of the world's guns, too.
Posted by Jonathan at 05:38 PM
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January 02, 2008
| Fillin' 'Er Up With Other People's Food | Development Energy Environment Ethics Future Peak Oil |
$100 oil prices poor folks out of the market for energy. But worse than that, it prices them out of the market for food. It's already happening. IHT:
In an "unforeseen and unprecedented" shift, the world food supply is dwindling rapidly and food prices are soaring to historic levels, the top food and agriculture official of the United Nations warned [December 17].The changes created "a very serious risk that fewer people will be able to get food," particularly in the developing world, said Jacques Diouf, head of the UN Food and Agriculture Organization.
The agency's food price index rose by more than 40 percent this year, compared with 9 percent the year before - a rate that was already unacceptable, he said. New figures show that the total cost of foodstuffs imported by the neediest countries rose 25 percent, to $107 million, in the last year.
At the same time, reserves of cereals are severely depleted, FAO records show. World wheat stores declined 11 percent this year, to the lowest level since 1980. That corresponds to 12 weeks of the world's total consumption - much less than the average of 18 weeks consumption in storage during the period 2000-2005. There are only 8 weeks of corn left, down from 11 weeks in the earlier period.
Prices of wheat and oilseeds are at record highs, Diouf said Monday. Wheat prices have risen by $130 per ton, or 52 percent, since a year ago. U.S. wheat futures broke $10 a bushel for the first time [December 17], the agricultural equivalent of $100 a barrel oil.
Diouf blamed a confluence of recent supply and demand factors for the crisis, and he predicted that those factors were here to stay. On the supply side, these include the early effects of global warming, which has decreased crop yields in some crucial places, and a shift away from farming for human consumption toward crops for biofuels and cattle feed. Demand for grain is increasing with the world population, and more is diverted to feed cattle as the population of upwardly mobile meat-eaters grows.
"We're concerned that we are facing the perfect storm for the world's hungry," said Josette Sheeran, executive director of the World Food Program, in a telephone interview. She said that her agency's food procurement costs had gone up 50 percent in the past 5 years and that some poor people are being "priced out of the food market."
To make matters worse, high oil prices have doubled shipping costs in the past year, putting enormous stress on poor nations that need to import food as well as the humanitarian agencies that provide it.
"You can debate why this is all happening, but what's most important to us is that it's a long-term trend, reversing decades of decreasing food prices," Sheeran said.
Climate specialists say that the vulnerability will only increase as further effects of climate change are felt. "If there's a significant change in climate in one of our high production areas, if there is a disease that effects a major crop, we are in a very risky situation," said Mark Howden of the Commonwealth Scientific and Industrial Research Organization in Canberra.
Already "unusual weather events," linked to climate change - such as droughts, floods and storms - have decreased production in important exporting countries like Australia and Ukraine, Diouf said. [...]
Sheeran said, that on a recent trip to Mali, she was told that food stocks were at an all time low. [...]
[R]ecent scientific papers concluded that farmers could adjust to 1 degree Celsius (1.8 degrees Fahrenheit) to 3 degrees Celsius (5.4 degrees) of warming by switching to more resilient species, changing planting times, or storing water for irrigation, for example.
But that after that, "all bets are off," said Francesco Tubiello, of Columbia University Earth Institute. "Many people assume that we will never have a problem with food production on a global scale, but there is a strong potential for negative surprises." [...]
Part of the current problem is an outgrowth of prosperity. More people in the world now eat meat, diverting grain from humans to livestock. A more complicated issue is the use of crops to make biofuels, which are often heavily subsidized. A major factor in rising corn prices globally is that many farmers in the United States are now selling their corn to make subsidized ethanol.
The world's food stocks are rapidly shrinking. Could anything be more fundamental? And yet there is almost no awareness of this situation in the world's wealthier nations.
By being energy hogs, we make other people go hungry. It's really that simple. Picture it next time you fill your tank: some of what's going in there is other people's food. Either directly, in the form of ethanol from corn, or indirectly, because our profligate energy use drives prices up and fuels global warming. This is a central moral issue of our time: will we in the world's wealthier nations continue to use our wealth to maintain a way of life that is increasingly deadly to everyone else on the planet? In other words, will we make other people starve so we can drive our SUV to the mall?
Posted by Jonathan at 05:04 PM
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| $100 | Peak Oil |
To get the new year started, oil topped $100 a barrel today for the first time ever.
You gotta love all the rationales analysts come up with. CNN:
Oil prices kicked off the first trading day of 2008 by hitting a new high of $100 a barrel Wednesday on violence in oil-rich Nigeria, the prospect of more interest rate cuts, a halt in Mexican imports and the expectation of yet another drop in U.S. crude supplies.
Whatever. Or maybe it's the obvious: there's no longer enough oil to go around. Demand exceeds supply, so prices rise to the point where enough people are priced out of the market to make supply and demand equal again.
Someday soon we'll look back with nostalgia at the days when a barrel of oil was only $100.
Posted by Jonathan at 12:35 PM
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December 21, 2007
| Plug-In Hybrids | Energy Peak Oil Science/Technology |
Go here and click for a great little video on plug-in hybrids. The technology works. So Cal Edison has been running an all-electric fleet of big repair trucks and over 200 cars for 10 years or more. Batteries are rapidly getting smaller and more powerful. What's needed now are economies of scale.
What are we waiting for?
[Thanks, Miles]
Posted by Jonathan at 02:20 PM
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November 21, 2007
| We're Doomed | Energy Peak Oil |
...if this is how we think:
(Source)
Posted by Jonathan at 06:32 PM
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November 15, 2007
| Biofuels From Food: A Crime Against Humanity | Energy Peak Oil |
This is just the beginning. As fuel becomes more expensive and scarce, the world's rich will not only price the world's poor out of the fuel market, they'll price them out of the food market as well, as more and more food crops and agricultural land (and fresh water) are used to generate biofuels. George Monbiot summons up the appropriate level of outrage:
It doesn't get madder than this. Swaziland is in the grip of a famine and receiving emergency food aid. Forty per cent of its people are facing acute food shortages. So what has the government decided to export? Biofuel made from one of its staple crops, cassava. The government has allocated several thousand hectares of farmland to ethanol production in the county of Lavumisa, which happens to be the place worst hit by drought. It would surely be quicker and more humane to refine the Swazi people and put them in our tanks. Doubtless a team of development consultants is already doing the [math].This is one of many examples of a trade described last month by Jean Ziegler, the UN's special rapporteur, as "a crime against humanity". Ziegler took up the call first made by this column for a five-year moratorium on all government targets and incentives for biofuel: the trade should be frozen until second-generation fuels - made from wood or straw or waste - become commercially available. Otherwise the superior purchasing power of drivers in the rich world means that they will snatch food from people's mouths. Run your car on virgin biofuel and other people will starve.
Even the International Monetary Fund, always ready to immolate the poor on the altar of business, now warns that using food to produce biofuels "might further strain already tight supplies of arable land and water all over the world, thereby pushing food prices up even further." This week the UN Food and Agriculture Organisation will announce the lowest global food reserves in 25 years, threatening what it calls "a very serious crisis". Even when the price of food was low, 850 million people went hungry because they could not afford to buy it. With every increment in the price of flour or grain, several million more are pushed below the breadline.
The cost of rice has risen by 20% over the past year, maize by 50%, wheat by 100%. Biofuels aren't entirely to blame - by taking land out of food production they exacerbate the effects of bad harvests and rising demand - but almost all the major agencies are now warning against expansion. And almost all the major governments are ignoring them.
They turn away because biofuels offer a means of avoiding hard political choices. They create the impression that governments can cut carbon emissions and - as Ruth Kelly, the British transport secretary, announced last week - keep expanding the transport networks. New figures show that British drivers puttered past the 500 billion kilometre mark for the first time last year. But it doesn't matter: we just have to change the fuel we use. No one has to be confronted. The demands of the motoring lobby and the business groups clamouring for new infrastructure can be met. The people being pushed off their land remain unheard.
In principle, burning biofuels merely releases the carbon they accumulated when they were growing. Even when you take into account the energy costs of harvesting, refining and transporting the fuel, they produce less net carbon than petroleum products....If you count only the immediate carbon costs of planting and processing biofuels, they appear to reduce greenhouse gases. When you look at the total impacts, you find that they cause more [global] warming than petroleum.
A recent study by the Nobel laureate Paul Crutzen shows that the official estimates have ignored the contribution of nitrogen fertilisers. They generate a greenhouse gas - nitrous oxide - which is 296 times as powerful as CO2. These emissions alone ensure that ethanol from maize causes between 0.9 and 1.5 times as much warming as petrol, while rapeseed oil (the source of over 80% of the world's biodiesel) generates 1-1.7 times the impact of diesel. This is before you account for the changes in land use.
A paper published in Science three months ago suggests that protecting uncultivated land saves, over 30 years, between two and nine times the carbon emissions you might avoid by ploughing it and planting biofuels. Last year the research group LMC International estimated that if the British and European target of a 5% contribution from biofuels were to be adopted by the rest of the world, the global acreage of cultivated land would expand by 15%. That means the end of most tropical forests. It might also cause runaway climate change. [...]
The only sustainable biofuel is recycled waste oil, but the available volumes are tiny.
At this point the biofuels industry starts shouting "jatropha!" It is not yet a swear word, but it soon will be. Jatropha is a tough weed with oily seeds that grows in the tropics. This summer Bob Geldof, who never misses an opportunity to promote simplistic solutions to complex problems, arrived in Swaziland in the role of "special adviser" to a biofuels firm. Because it can grow on marginal land, jatropha, he claimed, is a "life-changing" plant, which will offer jobs, cash crops and economic power to African smallholders.
Yes, it can grow on poor land and be cultivated by smallholders. But it can also grow on fertile land and be cultivated by largeholders. If there is one blindingly obvious fact about biofuel it's that it is not a smallholder crop. It is an internationally-traded commodity which travels well and can be stored indefinitely, with no premium for local or organic produce. Already the Indian government is planning 14m hectares of jatropha plantations. In August the first riots took place among the peasant farmers being driven off the land to make way for them.
If the governments promoting biofuels do not reverse their policies, the humanitarian impact will be greater than that of the Iraq war. Millions will be displaced, hundreds of millions more could go hungry. This crime against humanity is a complex one, but that neither lessens nor excuses it. If people starve because of biofuels, Ruth Kelly and her peers will have killed them. Like all such crimes it is perpetrated by cowards, attacking the weak to avoid confronting the strong.
It will be a crime of unimaginable proportions, but it is hard to see what will avert it. People who can afford cars won't voluntarily give them up because of unseen side effects a world away. Rationalization will be easier than changing one's way of life. The resulting famine and war in faraway countries will be blamed on other causes — extremism, religious conflict, tribalism, backwardness — if it is even noticed at all. And even the minority of people who make the connections will find it hard not to take the path of least resistance: what good will it do really if I stop driving? I'm just one small drop in a very large bucket. I've got to get to work somehow, and to the mall, and my kids' soccer practice. And so millions will die.
Posted by Jonathan at 10:12 PM
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October 30, 2007
| Al-Huseini: World Oil Production Has Peaked | Peak Oil |
David Strahan, author of The Last Oil Shock, has a new interview with Sadad al-Huseini, former head of exploration and production at Saudi Aramco. Strahan:
Sadad al-Huseini says that global [oil] production has reached its maximum sustainable plateau and that output will start to fall within 15 years, by which time the world's oil resources will be "very severely depleted".
Strahan has a number of other articles and podcasts here.
Posted by Jonathan at 05:52 PM
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October 29, 2007
| Do I Hear 94? | Peak Oil |
As I write this, oil is up $1.67 on the day to $93.53.
Posted by Jonathan at 04:22 PM
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October 26, 2007
| Do I Hear 92? | Peak Oil |
Another day, another record oil price. Up $1.40 to $91.86.
Posted by Jonathan at 04:23 PM
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October 25, 2007
| Do I Hear 90? | Peak Oil |
As I write this, oil is up $2.40 on the day to $89.50.
Update: Now up $3.36 to $90.46.
Posted by Jonathan at 01:05 PM
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October 16, 2007
| Do I Hear 88? | Peak Oil |
As I write this, oil is up another $1.34 to $87.47 a barrel, after flirting with $88 a barrel earlier in the day.
Update: Now $87.82.
Posted by Jonathan at 11:18 AM
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October 15, 2007
| Oil Smashes Price Record | Peak Oil |
As I write this, oil is up almost 3% on the day to a whopping $86.13. 86 bucks a barrel. Not a typo.
Posted by Jonathan at 03:05 PM
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October 11, 2007
| Oil Top $83 A Barrel | Peak Oil |
As I write this, oil is up more than $2 for the day, to $83.33 a barrel.
Posted by Jonathan at 12:00 PM
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| Past Peak | Peak Oil |
A very interesting post on yesterday's Oil Drum summarizes world oil production over the last seven years. First, a graph:
Each band shows, for a country or group of countries, the difference between its production level and its minimum production level over the period covered by the graph. The authors call this "incremental" production. The baseline is the thin grey bar at the bottom. Taking the baseline and stacking the incremental production bands on top gives total production.
There's a thick black line about two-thirds of the way up. The countries below the line are in decline (or at least not growing). Notice how steeply the black line begins to fall starting in 2005: the declining countries are declining rapidly. (Production in those countries is 3.8 million barrels per day less than it was just 2.5 years ago.) That decline needs to be offset by growth elsewhere just to maintain the status quo. The countries below the black line include: US, Indonesia, Australia, Denmark, Argentina, Oman, Colombia, Gabon, Egypt, Syria, Yemen, UK, Norway, Iran, Malaysia, Mexico, Ecuador, Vietnam, Qatar, India, Kuwait, UAE, Saudi Arabia, Nigeria, Iraq, and some others.
The bands above the black line are areas where production is still growing. These include: China, Russia, Algeria, Libya, Sudan, Eq. Guinea, Brazil, Canada, Kazakhstan, Angola, Azerbaijan. Some, like China and Russia, are expected to peak in the next few years. Others, like Kazakhstan and Azerbaijan, are likely to hit a plateau because of pipeline constraints. Hence, the ability of these growth regions to continue making up for decline elsewhere is doubtful.
The bottom, maroon band is the US. Notice the sharp dip in late 2005. That's when Katrina hit, taking out a lot of production in the Gulf. The authors adjusted their figures by extrapolating what US production would have looked like were it not for Katrina and got this:
Without the dip caused by Katrina, it looks like world production peaked in the latter half of 2005. I.e., Katrina obscured that fact that we're already past peak.
Posted by Jonathan at 10:15 AM
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October 05, 2007
| The End Of Cheap Oil | Peak Oil |
The chief economist at the Canadian Imperial Bank of Commerce says we should expect $100 a barrel oil by the end of next year, and it's likely to be three-digit prices from then on out. AP (via John Robb):
Oil prices could top $100 a barrel by the end of next year and remain above that point for years to come, the chief economist of Canadian investment bank CIBC World Markets said Tuesday.Jeffrey Rubin said rising demand within oil-rich nations such as Mexico, Venezuela and Saudi Arabia will put pressure on global oil prices in the coming years. That, combined with the increased cost of pulling petroleum from reserves deep under the sea or wringing it out of oil sands in Canada, will keep oil prices high even if demand in the Western world remains constant.
"We're in a world of triple digit oil prices for the foreseeable future," Rubin said during a speech to investors here.
Rubin said oil exports from OPEC countries, Russia and Mexico will likely decline by about 3 million barrels per day over the next five years. The biggest drop, he expects, will come from Mexico, a key U.S. supplier.
"Of the 3 million barrels, we're probably talking about 2 million barrels are going to come directly out of U.S. supplies," he said.
Rubin expects Mexican oil imports to the U.S. will dry up by about 2012. Some of that decline will be made up by imports from other parts of the world, but the lions' share — nearly a third of all U.S. oil imports — will come from Canadian oil sands, he predicted.
But replacing relatively easy-to-refine liquid crude with petroleum from oil sands is certain to increase costs, he said. By the end of the decade, Canadian oil sands are likely to represent the world's largest source of new oil supplies, he said.
"We're basically replacing low-cost oil with high-cost oil," he said.
Looking ahead, Rubin expects crude oil prices to average as much as $90 a barrel next year, rising to around $100 by the end of 2008. That would represent an increase of nearly 25 percent over Tuesday's settlement price of $80.05 a barrel for light, sweet crude on the New York Mercantile Exchange.
"Triple digit prices is not a spike," he said. "Triple digit oil prices is what is going to be required to maintain, let alone grow, world oil supplies." [Emphasis added]
What does this mean? John Robb summarizes nicely:
Over the past one hundred years, we have been able to plow through obstacles and limits to growth by throwing cheap energy at them (which makes even inefficient increases in social/economic complexity viable). What happens when energy isn't cheap anymore, but rather moderately expensive? Do those past increases in complexity come back to haunt us? Yes.
It would be hard to overstate the extent to which life in the developed world is organized around the availability of cheap energy. Mega-cities, sprawling suburbs, globalization itself. Most of what we consume comes to us from hundreds or thousands of miles away. And it's not just a question of energy. Oil is the raw material from which plastics, fertilizers, and pharmaceuticals are manufactured.
We're like the dinosaurs, just before the asteroid hit. Not that we're doomed, but we're about to experience rapid, nonlinear changes in an environment we depend on for our very survival. Our adaptation to that environment has been cultural and technological rather than biological, a crucial advantage over the dinosaurs. But the challenge will be substantial, and we don't have a lot of time. Given the rate at which oil is consumed, most of us are going to be surprised by how quickly we burn through what's left.
Posted by Jonathan at 03:34 PM
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September 27, 2007
| Dollar Hits All-Time Low | Economy Peak Oil |
The dollar continued its slide, falling to 1.4189 against the euro today, the dollar's all-time lowest point since the euro was invented. The dollar's set a new low each of the last six trading days.
Meanwhile, oil prices rose $2.58 (3.21%) for the day, to close at $82.88 a barrel, after topping $83 a barrel in intraday trading.
But stocks? They're up. Who says markets are rational?
Posted by Jonathan at 05:13 PM
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September 18, 2007
| Oil Tops $82 A Barrel | Peak Oil |
Oil jumped $1.81 today to close at another new record: $82.38 per barrel.
Posted by Jonathan at 05:02 PM
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September 17, 2007
| Oil Price Sets New Record — Again | Peak Oil |
Oil rose $1.47 today, closing at $80.57 a barrel, another new record.
Posted by Jonathan at 03:01 PM
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September 13, 2007
| Oil Closes Above $80 For First Time | Peak Oil |
Another day, another record oil price. Bloomberg:
Crude oil rose, closing above $80 a barrel in New York for the first time, after Hurricane Humberto shut three refineries in Texas.Gasoline gained, pulling oil higher, as the storm knocked out power at plants in Port Arthur, Texas, owned by Total SA, Valero Energy Corp. and Royal Dutch Shell Plc. The plants can process a combined 850,000 barrels of crude oil a day.
"We don't have the ability to lose any refining capacity, especially since refineries are shutting for maintenance ahead of heating-oil season," said Peter Beutel, president of Cameron Hanover Inc., a New Canaan, Connecticut, energy consultant. [...]
Crude oil for October delivery advanced 18 cents to settle at $80.09 a barrel at 2:59 p.m. on the New York Mercantile Exchange, a record close. Futures touched $80.20, the highest intraday price since trading began in 1983. Prices are up 25 percent from a year ago. [Emphasis added]
Something of a non sequitir there: loss of refineries could contribute to higher gasoline prices, but it's hard to see why it would cause crude oil prices to climb. It might actually have the opposite effect, as reduced refining capacity would tend to allow inventories of unrefined crude oil to grow in the backlog. As usual, analysts reach for something in the day's news to explain the day's trading, ignoring the fact that larger forces are at work.
Posted by Jonathan at 05:07 PM
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September 12, 2007
| Atlantic: Ghawar In Decline | Peak Oil |
An article in The Atlantic based on Stuart Staniford's work at The Oil Drum pretty much concludes that Saudi Arabia's oil production has peaked and is now in decline. That would mean the world's in decline: Peak Oil is here. Excerpts:
No country is more important to oil markets than Saudi Arabia. The kingdom produced roughly 9.2 million barrels of crude a day in 2006, and accounted for 19 percent of world oil exports. Many analysts expect it to supply a quarter of the world’s added production over the next few years. And as the only producer with significant excess capacity, it has played a crucial role [in the past] in alleviating temporary supply disruptions, increasing daily production by 3.1 million barrels during the first Gulf War, for example, when oil production in Iraq and Kuwait dropped by 5.3 million barrels.The Ghawar oil field is the kingdom’s crown jewel. Stretching for more than 150 miles beneath the desert, it is the largest known deposit in the world. It produces perhaps twice as much oil as any other field, and has doubtless accounted for more than half of Saudi Arabia’s oil production. Yet the Saudis have been removing oil from this reservoir for half a century. Sooner or later, its production must fall.
The Saudis do not release data on how much oil they are extracting from individual wells, or on the remaining reserves of individual oil fields. But the total amount that the kingdom produces has been declining, down a million barrels a day over the last two years of data.
The Saudis have claimed these cuts have been in response to weak demand. However, the big drop in production began in the spring of 2006, when the price of oil was rising from $60 to $74 a barrel; the claim that no one wanted to buy Saudi Arabia’s light crude strains credulity. The drop in production has also coincided with a huge new Saudi effort to find and pump more oil: The number of active oil rigs in Saudi Arabia has tripled over the past three years.
Frustrated by the lack of hard data on Ghawar, Stuart Staniford, a computer scientist with a doctorate in physics, has conducted a painstaking study of publicly available information. His research has been reported at theoildrum.com, a Web site that analyzes energy markets. [...]
Staniford has also built a detailed computer simulation of the Ghawar reservoir, based on its size and shape, the porosity and permeability of its rock, and the assumed oil-extraction rates. The results of this simulation line up remarkably well with Staniford's other calculations. Oil production from northern Ghawar has likely peaked.
Southern Ghawar still holds a lot of oil, and perhaps the kingdom's push to find new fields will bear fruit. But northern Ghawar was developed first because it was by far the most promising field. Its production cannot be easily replaced. At about the same time that Saudi production began its decline, the new Haradh project in southern Ghawar began producing perhaps an additional 300,000 barrels a day. The Saudis have also made a huge investment to reopen the Qatif field on the eastern coast, which they had abandoned in 1995; it is now producing an estimated half-million barrels a day. With Saudi production falling despite these new contributions, the situation could be serious.
At a bare minimum, the era when excess Saudi capacity could cushion geopolitical disruptions in oil supplies may well be over, even though the threat of such disruptions is greater than ever. And if Saudi production continues to decline even as world demand keeps growing, in a few years we will look back at the summer of 2007 as the last of the days when gasoline — even at $3.50 a gallon — was still plentiful and cheap. [Emphasis added]
Saudi output down a million barrels a day while they triple the number of active oil rigs. If that doesn't say depletion, I don't know what does.
Posted by Jonathan at 05:17 PM
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| Oil Tops $80 A Barrel | Peak Oil |
Earlier today, oil rose to $80.18 a barrel.
As I write this, it's up $1.68 to $79.91 a barrel.
Yesterday's all-time record of $78.23 sure didn't last long.
Posted by Jonathan at 04:59 PM
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September 11, 2007
| Shell May Use Nuclear To Power Tar Sands Operation | Energy Peak Oil |
As Kevin says at Cryptogon, this reads like something from The Onion. Independent:
Shell is considering using nuclear power to operate its controversial tar sands programme in Canada.Tar sands extraction – mining oil from a mixture of sand or clay, water and very heavy crude oil – uses a huge amount of energy and water. Environmentalists say it results in more than three times as many emissions of carbon dioxide compared to conventional oil production.
Now Canadian firms AECL and Energy Alberta have proposed building a nuclear reactor near the site of Shell's vast Athabasca tar sands development. The boss of Energy Alberta has said the C$6bn (£2.8bn) reactor has the backing of a large unnamed copany that would take 70 per cent of the reactor's energy.
A spokeswoman for Shell Canada refused to confirm that the company would take electricity from the reactor but said: "We have had a number of power options presented to us. Yes, it includes nuclear.
"If a nuclear facility proceeds, we would look at it based on a wide range of factors such as economics, sustainability and the energy [required]."
She added that the company was also looking at building biomass, renewable or co-generation plants.
Analysts estimate that Canada's huge tar sands give it the world's second-largest oil reserves after Saudi Arabia.
However, Walt Patterson, associate fellow at think-tank Chatham House, said: "Extracting oil from tar scares the pants off me. The whole idea is fundamentally perverse in the context of our present environmental situation. To then power it with nuclear, it seems to be the worst of all worlds."
The Independent on Sunday has also been told that, earlier this year, Shell Canada contacted French nuclear firm Areva to find out how much it would cost to build a reactor for the oil sands project, but did not pursue this option because of the cost. The Shell Canada spokeswoman could not confirm this discussion took place.
Shell and its Athabasca partners currently pump over 155,000 barrels of oil per day from the tar sands but want to increase this by five times over the next 20 years. This would need more than an extra 1,000MW of generating capacity. Most of the project's existing power comes from a gas-fired plant, but gas production in North America is declining.
We're addicted to oil, and this is the way addicts behave. No scheme is too self-destructive, no idea too crazy, if it lets the addict get his fix. What's frightening is not so much the insanity of this particular idea — crazy though it is — but the glimpse it provides of the desperation to come. When world oil production starts to decline in earnest, people are going to get reckless.
Update: Oil closed today at $78.23, an all-time record.
Posted by Jonathan at 05:24 PM
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July 05, 2007
| Oil Back Above $70 Per Barrel | Peak Oil |
As I write this, crude oil is at $71.73 a barrel.
Posted by Jonathan at 12:58 PM
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June 28, 2007
| "We Have A Very Big Problem" | Peak Oil |
Jerome-a-Paris links to an unusually frank interview in Le Monde (in French) with Fatih Birol, chief economist of the International Energy Agency. Birol (Jerome's translation):
If Iraqi production does not rise exponentially by 2015, we have a very big problem, even if Saudi Arabia fulfills all its promises. The numbers are very simple, there's no need to be an expert.
Iraqi production rises exponentially? Saudi Arabia fulfills all its promises? What are the chances?
Jerome says:
The whole interview is amazingly frank and free of diplomatic obfuscation. He blasts biofuels ("not based on any kind of economic rationality"), he notes that Africa is suffering the most already from expensive oil, he points out that even a slowing of China's growth will not reduce oil demand, and he talks pretty explicitly about production peaks and depletion:Within 5 to 10 years, non-OPEP production will reach a peak and begin to decline, as reserves run out. There are new proofs of that fact every day. At the same we'll see the peak of China's economic growth. The two events will coincide: the explosion of Chinese growth, and the fall in non-OPEP oil production. Will the oil world manage to face that twin shock is an open question.He says it again twice in the interview: the gap between demand and supply will widen, and he blasts our governments for doing so little:
Unfortunately, there's a lot of talk, but very little action. I really hope that consuming nations will understand the gravity of the situation and put in place radical and extremely tough policies to curb oil demand growth.Of course, we might need to curb more than "demand growth", and actually move to curb "demand" itself, but his words are at least quite direct and explicit. Even more interestingly, he puts the finger on two important but rarely discussed items: field depletion (he mentions an 8% decline rate for mature fields, but indicates that even a 1% difference in the actual number would mean huge volumes by 2020), and Saudi reserves:
I understand the Saudi government claims 230 billion barrels of reserves, and I have no official reason not to believe these numbers. Nevertheless, Saudi Arabia - as well as other producing countries and oil companies - should be more transparent in their numbers. Oil is a crucial good for all of us and we have the right to know how much oil, as per international standards, is left.While not a direct attack on Saudi numbers, this is by far the most explicit voicing of doubt about their reserves from any official of a major organisation that I have ever read. "No official reason to doubt"??? That's a pretty gaping hole there to sneak other kinds of doubts... He notes that he believes Saudi Arabian promises to be able to bring its capacity from 12mb/d today to 15mb/d in 2015, but notes at the same time that (i) it's the only place in the world (other, potentially, than Iraq) where production can grow and (ii) it's less than the expected demand growth by then from China alone. [Emphasis in the original]
Birol is an expert, but even he says, "the numbers are very simple, there's no need to be an expert." It's coming, and probably sooner than you think.
Posted by Jonathan at 05:52 PM
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April 28, 2007
| Oil Depletion Atlas | Peak Oil |
An interesting (if overly optimistic) interactive oil depletion atlas of the world. Why optimistic? E.g., it's got Saudi Arabia peaking in 2018 at almost 15 million barrels/day. Don't bet on it.
But even if we accept the optimistic figures, the overall picture is of a world for which peak is no more than a decade away. And the band plays on.
Posted by Jonathan at 05:14 PM
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March 31, 2007
| The Post-Peak Path Of Least Resistance | Energy Environment Peak Oil |
I don't think the end of cheap oil will mean that things completely grind to a halt à la James Kunstler. But what seems like good news may actually be bad news. Very bad news. Why?
Humans, like other organisms, generally take the path of least (short-term) resistance. It's our nature. In the Peak Oil context, the path of least resistance won't be to change how we organize cities and suburbs; or to switch to public transportation; or even to drive significantly smaller, more efficient vehicles. Nor will it be most of the other alternatives that could meaningfully reduce the demand for liquid fuels.
Instead, the path of least resistance will be to substitute other liquid fuels for gasoline and diesel, those other fuels probably being ethanol made from plant matter and, most alarmingly, synthetic fuel made from coal. There is an enormous amount of coal remaining, and if we put all of that carbon in the atmosphere the results will be deadly.
As people flail about for ways to cope with increasing shortfalls in oil production, they will act hurriedly, thoughtlessly, and they will almost certainly exacerbate global warming, perhaps catastrophically. That will be the path of least resistance.
In a BBC op-ed, author David Strahan makes a similar point. Excerpts:
[I]t is quite possible to run out of oil and pollute the planet to destruction simultaneously.In fact peak oil could even make emissions worse if it drives us to exploit the wrong kinds of fuel.
Burning rainforest and peatlands to create palm oil plantations for biofuels releases vast amounts of CO2, and has already made Indonesia, according to some ways of calculating it, the world's third biggest emitter after the US and China.
Synthetic transport fuels made from natural gas using the Fischer-Tropsch process emit even more carbon on a well-to-wheels basis than conventional crude; and when the feedstock is coal, the emissions double.
None of these alternatives are likely to fill the gap left by conventional crude — at least, not in time.
But because they are so much more carbon intensive, it is quite easy to conjure scenarios in which we still suffer fuel shortages while emitting even more CO2 than in the current business-as-usual forecast — the worst of all possible worlds.
Although these fuels are likely to prove inadequate, we may be driven to use them because cleaner alternatives are even more inadequate, for a variety of reasons.
Biofuels can be produced sustainably and with real CO2 reductions, but in the industrialised world there simply isn't the land.
In the developing world, however, there are vast swathes of land which could be put to sugar cane in a sustainable fashion; but the scale of the task of replacing crude oil would still be monumental.
I calculate that to substitute the fuel lost through a post-peak oil production annual decline of 3% would mean planting about 200,000 sq km — equivalent to the land area of Cuba, Sri Lanka and Papua New Guinea — every year.
Alternatively, if we decided to run Britain's road transport system, say, on cleanly produced hydrogen — electrolysing water using non-CO2-emitting forms of generation — our options would be:
67 Sizewell B nuclear power stations
a solar array covering every inch of Norfolk and Derbyshire combined
or a wind farm bigger than the entire southwest region of England. When oil production starts to fall, the economic impacts could well be devastating.
Soaring crude prices could tip the world into a depression deeper than that of the 1930s, and collapsing stock markets cripple our ability to finance the expensive clean energy infrastructure we need.
As the unemployment lines grow, the political will to tackle climate change may be sapped by the need to keep the lights burning as cheaply as possible.
Many environmentalists seem to dismiss or ignore peak oil because they simply cannot see it as significant when compared to climate change.
But this is to miss the point.
Oil depletion is deadly serious in its own right, but it also has the capacity both to worsen emissions and destroy the wealth needed to fight global warming.
For this reason - among others - it too has the power to destroy our civilisation. [Emphasis added]
Desperate people do desperate things. Fuel shortages will be an immediate, concrete problem staring people in the face. Global warming will seem, by comparison, an abstraction somewhere off in the future. And it will be easy for people to rationalize that their little contribution to global warming is an insignificant drop in a very big bucket; meanwhile, they need a way to get to work, to shop, to heat their homes. They are going to want fuel; they're not going to care much where it comes from.
Of course, there are significant wild cards in any attempts to project the future. Biotechnology and nanotechnology, especially, have the potential to radically transform the equation. (And also to create their own brand of havoc.) But the next couple of decades are pivotal, and the sheer scale of the problem means that new technologies may arrive too late. Enormous damage is already being done, right now, in the race to produce biofuels. The colossal scale of the world's thirst for fuel pretty much guarantees that in the race for profits all sorts of bad ideas will be pushed into large-scale use without due regard for the consequences. We suffer from a kind of technological monoculture and a monoculture of the mind that causes us to risk way too much on a few throws of the dice.
If we act without thinking, we're guaranteed to follow the path of least (short-term) resistance. But it's the wrong path. It remains to be seen if humans are smart enough to forego short-term convenience to gain long-term survival. Are we?
[Thanks, Jason]
Posted by Jonathan at 05:55 PM
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March 03, 2007
| Saudi Arabia In Decline? | Peak Oil |
This is one of those stories that ought to be front page news all over the world: recent trends appear to show that Saudi Arabia's oil production is now in decline — rather steep decline, at that. This would have to mean that Ghawar, the big daddy among the world's oil fields, is in decline. And if Ghawar and Saudi Arabia are in decline, then the world's in decline. It's that simple. Peak oil is here.
Analysis by Stuart Staniford at The Oil Drum:
What I did in this post was to look in more detail at what happened from the beginning of 2006 on, which is when the apparent decline begins. I added data from a fourth source (the OPEC Monthly Oil Market Review), and for each of the four sources of data, I fit a linear trend:
The resulting graph is extremely striking, I think. The four different sources all estimate Saudi production slightly differently - they fluctuate in different ways month to month, and disagree over the absolute level (that last may be differences in exactly what is defined as oil). However, the regressions make clear that all four sources are in strong agreement about the nature of the decline. The slopes of the lines are very similar.
The implied decline rate through the year is 8% ± 0.1%. (Note that the year on year decline from 2005 to 2006 will only be about half that, as the decline only began at the beginning of 2006). As far as I know, there are no known accidents or problems that would explain any restrictions on oil supply, and the Saudis themselves have maintained publicly that their production is unproblematic and they intend to increase it.
It's interesting to note the pattern in the underlying data where declines start, are interrupted in the middle of the year, and then resume. I take this to be due to the coming onstream of the 300kbpd of liquids from the Haradh III megaproject. [...]
It seems this did not do more than briefly interrupt the declines. We can get a clearer picture as follows. What I did was average the EIA, IEA, and JODI series for 2005 and 2006 into a single estimate. Onto that, I've hand drawn a couple of guidelines that are 300 kbpd apart vertically:
My intepretation is that the bump in the middle of the year that separates the two lines is due to the impact of Haradh III coming on stream. So that tells us that, given some extra production capacity, Saudi Aramco immediately threw it into the production mix. And the effect of that? It lifted the plummeting production curve up by 300kbpd, but did nothing to change the gradient of the plummet. That suggests that the Saudis had nothing else to throw at the problem.
It also suggests that last year's underlying Type II decline rate, before megaprojects like Haradh III, was 14%.
Overall, I feel this data is clear enough that I'm willing to go out on a limb and conclude the following:
Saudi Arabian oil production is now in decline.
The decline rate during the first year is very high (8%), akin to decline rates in other places developed with modern horizontal drilling techniques such as the North Sea.
Declines are rather unlikely to be arrested, and may well accelerate. [...]I suggest that this is likely to place severe political strains on Saudi Arabia within a year or two at most. [Emphasis added]
To drive the point home, Staniford ends with this:
I'll bet $1000 with the first person who cares to take me up on it that the international oil agencies will never report sustained Saudi production of crude+condensate of 10.7 million barrels or more.
As we've noted a number of times in the past, modern production technology does such a good job of extracting oil from the ground that production doesn't fall off much until the end is near, and then the fall-off tends to be precipitous. The good news is that we're really good at getting the toothpaste out of the tube. The bad news is that we're so good at it that we don't get much warning that the tube is approaching empty.
Staniford's analysis says that the underlying rate of Saudi decline over the past year was 14%. This is potentially earth-shaking news. Recall that production at Mexico's Cantarell, the world's second largest producing oil field, peaked and fell 25% last year. If Ghawar follows suit, the shit has officially hit the fan.
Don't expect to see coverage of this on your tv. There's nothing to film, no celebrity angle, no rehabs, no funerals. Just what may turn out to be one of the biggest stories of our lifetimes.
Posted by Jonathan at 03:37 PM
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January 30, 2007
| Cantarell Collapsing Faster Than Expected | Peak Oil |
As we've noted several times over the past year, Mexico's largest oil field (and the world's second largest), Cantarell, has peaked and is in sharp decline. The decline is turning out to be more drastic than even the most pessimistic projections. WSJ (via Rigzone):
Daily output at Mexico's biggest oil field tumbled by half a million barrels last year, according to figures released Friday by the Mexican government. The ongoing decline at the Cantarell field could pressure prices on the global oil market, complicate U.S. efforts to diversify its oil imports away from the Middle East, and threaten Mexico's financial stability.The virtual collapse at Cantarell — the world's second-biggest oil field in terms of output at the start of last year — is unfolding much faster than projections from Mexico's state-run oil giant Petroleos Mexicanos, or Pemex. Cantarell's daily output fell to 1.5 million barrels in December compared to 1.99 million barrels in January, according to figures from the Mexican Energy Ministry.
Mexico made up for some of the field's decline. Mexico's overall oil output fell to just below three million barrels a day in December, down from almost 3.4 million barrels at the start of the year. It marked Mexico's lowest rate of oil output since 2000.Mexico's troubles at Cantarell mirror the larger problems in the global oil market. Many of the world's biggest fields are old and face decline, which can be sharp and sudden. Like other big producers, Mexico is struggling to make up the difference because new big fields are in harder-to-reach places like the deep waters of the Gulf of Mexico.
The field's decline is expected to continue, if not worsen, this year, according to most estimates. That will subtract valuable oil from the world market, which is under pressure from rising demand by growing economies like China and India. It also means less oil headed to the U.S. from Mexico, which has long relied on Mexico as one of its top-three oil suppliers.
"This is bad news for Mexico. The field is declining faster than even the government's pessimistic scenarios," says David Shields, an oil industry consultant in Mexico City who has been warning about Cantarell's collapse for the past two years. [...]
Mexico's growing economy is demanding more fuel each year, which is expected to translate to even lower oil exports. Last year, Mexico's daily average oil exports fell to 1.79 million barrels a day from 1.82 million the previous year. Pemex says it expects daily exports to fall to an average 1.65 million barrels this year.
But some analysts say that is too optimistic. December's daily exports were a meager 1.53 million barrels. While that figure may have been affected by bad weather that closed some ports, it was already well below Pemex's estimates for this year.
Based on the state company's track record so far at Cantarell, including its current rates of recovering the oil that remains in the field, Mr. Shields expects the field's output to drop another 600,000 barrels a day by the end of this year. He says that Pemex will likely increase output by 200,000 barrels a day at other fields — leaving the country with a net decline of 400,000 barrels a day by year's end and daily exports of less than 1.4 million barrels. [Emphasis added]
Technology is a two-edged sword. Advanced techniques are very good at squeezing the toothpaste out of the tube. Unfortunately, they are so good at it that when the end comes, it comes suddenly. (Remember this picture.) A number of oil fields are showing alarmingly steep decline rates as a result. Cantarell's production has fallen by 25% in a single year. And Cantarell is not alone.
Posted by Jonathan at 11:04 AM
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January 07, 2007
| Mission Accomplished | Energy Iraq Peak Oil |
"Respectable" opinion has it that only naive ex-hippies are so simple-minded as to believe that the US attacked Iraq for its oil. Whatever. But read this. The Independent:
Iraq's massive oil reserves, the third-largest in the world, are about to be thrown open for large-scale exploitation by Western oil companies under a controversial law which is expected to come before the Iraqi parliament within days.The US government has been involved in drawing up the law, a draft of which has been seen by The Independent on Sunday. It would give big [US and British] oil companies such as BP, Shell and Exxon 30-year contracts to extract Iraqi crude and allow the first large-scale operation of foreign oil interests in the country since the industry was nationalised in 1972.
The huge potential prizes for Western firms will give ammunition to critics who say the Iraq war was fought for oil. They point to statements such as one from Vice-President Dick Cheney, who said in 1999, while he was still chief executive of the oil services company Halliburton, that the world would need an additional 50 million barrels of oil a day by 2010. "So where is the oil going to come from?... The Middle East, with two-thirds of the world's oil and the lowest cost, is still where the prize ultimately lies," he said.
Oil industry executives and analysts say the law, which would permit Western companies to pocket up to three-quarters of profits in the early years, is the only way to get Iraq's oil industry back on its feet after years of sanctions, war and loss of expertise. But it will operate through "production-sharing agreements" (or PSAs) which are highly unusual in the Middle East, where the oil industry in Saudi Arabia and Iran, the world's two largest producers, is state controlled.
Opponents say Iraq, where oil accounts for 95 per cent of the economy, is being forced to surrender an unacceptable degree of sovereignty.
Proposing the parliamentary motion for war in 2003, Tony Blair denied the "false claim" that "we want to seize" Iraq's oil revenues. He said the money should be put into a trust fund, run by the UN, for the Iraqis, but the idea came to nothing. The same year Colin Powell, then Secretary of State, said: "It cost a great deal of money to prosecute this war. But the oil of the Iraqi people belongs to the Iraqi people; it is their wealth, it will be used for their benefit. So we did not do it for oil."
Supporters say the provision allowing oil companies to take up to 75 per cent of the profits will last until they have recouped initial drilling costs. After that, they would collect about 20 per cent of all profits, according to industry sources in Iraq. But that is twice the industry average for such deals.
Greg Muttitt, a researcher for Platform, a human rights and environmental group which monitors the oil industry, said Iraq was being asked to pay an enormous price over the next 30 years for its present instability. "They would lose out massively," he said, "because they don't have the capacity at the moment to strike a good deal."
Iraq's Deputy Prime Minister, Barham Salih, who chairs the country's oil committee, is expected to unveil the legislation as early as today...The Iraqi government hopes to have the law on the books by March.
Several major oil companies are said to have sent teams into the country in recent months to lobby for deals ahead of the law, though the big names are considered unlikely to invest until the violence in Iraq abates.
James Paul, executive director at the Global Policy Forum, the international government watchdog, said: "It is not an exaggeration to say that the overwhelming majority of the population would be opposed to this. To do it anyway, with minimal discussion within the [Iraqi] parliament is really just pouring more oil on the fire." [Emphasis added]
Iraq's reserves are one of the last great untapped sources of inexpensive conventional oil left on Earth. The profits involved will be almost unimaginable, especially as world oil production peaks, driving prices skyward.
Pop quiz. Now that US and British oil majors are getting a 30-year lock on those profits, what are the chances that the US and Britain will walk away and leave all that money lying on the table? Or will they, as Big Gav put it, "fight on in Iraq until the end of the oil age"? It doesn't take a naive ex-hippie to know the answer to that one.
Posted by Jonathan at 07:02 PM
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