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On World Oil Production at 3/31/2014: Where are We Headed?

JP,

You are right, oil prices are still high by historical standards. 

The problem from oil companies points of view is that costs keep rising year after year, and they keep rising by quite a lot. Oil prices aren't a much higher in 2014 than they were in 2011, but costs keep rising. Also, oil companies have developed a lot of what looked like reasonable resources, but they didn't tun out as well as planned. I write about this issue in the post Beginning of the End? Oil Companies Cut Back on Spending.

So what we are now seeing is that the majors are cutting back on new exploration and production, so that they can maintain their dividends to shareholders. Shale drillers are being forced to use more junk debt to stay on the treadmill. 

August 1, 2014    View Comment    

On World Oil Production at 3/31/2014: Where are We Headed?

Perhaps Euorpe will find alternate supplies of natural gas. Whether they will foin oil supplies, I am not so sure. Too many are headed down, so they are likely to need more imports. That strethches those with export capacity to try to fill more needs.

July 31, 2014    View Comment    

On World Oil Production at 3/31/2014: Where are We Headed?

Willem,

You are right! I haven't looked at the details of your numbers.

Furthermore, to the extent that we succeed in reducing Russia's future oil production but do not offset it with rising production of our own, we are pushing down the oil porduction for the world as a whole.

If world supply were not so badly constrained, this would not be a problem. We need any supply we can get now.

 

July 31, 2014    View Comment    

On Eight Energy Myths Explained

This paper was written during the period when electricity from nuclear energy was expected to be "too cheap to meter." In a later paper, he talks about using the energy from nuclear to "reverse combustion" and make liquid fuels.

By 1976, Hubbert had changed his view of what might work. He showed solar energy taking over from fossil fuels, instead of nuclear. Solar doesn't scale nearly as well. I think the issue was disillusionment with nuclear, rather than conviction that solar would really work.

 

May 2, 2014    View Comment    

On Eight Energy Myths Explained

Don't count on coal-to-liquid operations. For one thing they require a lot of water. If a country has a lot of coal, as China does, it doesn't necessarily have water to go with it. The US West has a lot of coal, too, but not the water needed to produce a liquid fuel from oil. 

THe other issue is that the liquid produced from coal is expensive. It also is very high in CO2 emissions, because of the extra coal burned in the process, besides the coal that goes to make the oil. With the high cost, it has detrimental effects on the economy--people can afford fewer other goods, so there will be lay offs. 

May 1, 2014    View Comment    

On Eight Energy Myths Explained

The problem that ties all of the shortages together is cost. We can fix one problem, or another, or another, but in the end, the solution costs more. Our wages don't rise though, espeically those of young people.

So, in the end, the problem we end up with is financial. Young people can't afford to pay back their student loans, or to buy new homes and cars. The government can't collect enough taxes to pay all of the benefits it has paid out. At some point, something has to give. 

Many economies have collapsed in the past. Quite often what happens in that the government collapses--think of the Former Soviet Union. People are not looking in the right direction to find the problems that are building up.

April 29, 2014    View Comment    

On Oil Limits and Climate Change: How They Fit Together

I am not sure what you are quoting. It is certainly not something I wrote.

April 15, 2014    View Comment    

On Oil Limits and Climate Change: How They Fit Together

We badly need globalization, to keep our current "model" going. But it seems to be going by the side now. Fighting over resources, when they are in short supply, has been going on as long as there have been humans, I expect. We had a temporary lull when fossil fuels were more abundant.

April 14, 2014    View Comment    

On The Absurdity of US Natural Gas Exports

You have to make the hydgoen somehow, using energy . Storing it then gets to be a problem. It iven tends to leak out of tanks, once stored. I am not convinced it is a very practical solution.

April 4, 2014    View Comment    

On The Absurdity of US Natural Gas Exports

Willem, 

I think you are right. Most of the export capacity will never be built. It is easier to get approvals on the general concept from the EIA than the actual funding for these projects, with a number of other projects likely producing lower cost gas. Obviously ships are needed as well, or the natural gas won't go far.

 

April 4, 2014    View Comment    

On Oil Limits and the Economy: One Story, Not Two

Thanks for the suggestion with respect to "Surviving Progress." I am not a movie watcher, so missed it.

I think that where the film and I differ relates to how much we can do about the situation. The film (as I understand it from the reviews) argues that we can save ourseleves by scaling back.

If our current situation really is the result of a physics related problem, then our ability to voluntarily scale back is very limited. Physics determines that economies with the greatest energy use are the most successful. Also, even if we scale back, there is the issue of finite resources still depleting, even if more slowly. 

March 23, 2014    View Comment    

On Reaching Debt Limits: With or Without China's Problems, We Have a Problem

Demand is affordability, in my book. Demand goes way down, if you get laid off your job. We need cheap oil (and cheap other fuels) to have today's jobs. It is lack of jobs that leads to lack of demand.

March 13, 2014    View Comment