ODAC News
Wednesday 07 Nov
The Oil Depletion Analysis Centre
Oil / Petrol Prices, US EIA Forecasts
1a/ $100 oil within touching distance
(Arabian Business, Wed 07 Nov)
1b/ Average petrol cost at £1 a litre
(BBC News, Wed 07 Nov)
1c/ Short-Term
Energy Outlook – November (US
Energy Information Administration, Tue 06 Nov)
1d/ As
Oil Nears $100, Look Out Below (Business Week, Wed 07 Nov)
1e/ What's
behind the jump in oil prices?
(Energy Bulletin, Wed 07 Nov)
Peak Oil films - A
Crude Awakening and Crude Impact
2a/ A
Crude Awakening and Crude Impact - Two Peak Oil Films (ODAC,
Mon 05 Nov)
2b/ UK
- A CRUDE AWAKENING: THE OIL CRASH TO BE RELEASED ON FRIDAY 9 NOVEMBER
Economy
3a/ Credit card users hurt by squeeze
(The Times, Tue 06 Nov)
3b/ Markets
fear banks have $1 trillion in toxic debt
(The Independent, Tue 06 Nov)
3c/ Anatomy
of a credit crisis (The Independent, Tue 06 Nov)
3d/ Plunging
markets fear a meltdown (The Telegraph, Tue 06 Nov)
3e/ Why
market turmoil will hit us all (The
Telegraph, Tue 06 Nov)
Natural Gas - GTL and Nord
Stream
4a/ GTL
Progress Falters As Developers Weigh Success Of First Wave Projects
(
4b/ Sweden
raises a new hurdle for German-Russian pipeline
(International Herald Tribune, Tue 06 Nov)
Peak Oil in the
5/ Monty Don on Peak Oil
and Gardening
(Transition Culture, Wed 31 Oct)
6/ Peak Oil in the
Mainstream Business Press (The Oil Drum:
Peak Oil in the Saudi Media
7/ Telling the Whole
Truth About Oil
(Arab News [The
Oil Shales
8/ Oil shale prospects
(Energy Resources Yahoo Group, Tue 06 Nov)
Biofuels
9/ COMMENT: Biofuels can
match oil production
(Financial Times, Wed 07 Nov)
IEA’s
World Energy Outlook 2007
10a/ Chinese,
Indian Growth to Spur Oil `Crunch,' IEA Says
(Bloomberg, Wed 07 Nov)
10b/ Oil
Prices: It Gets Worse (Time, Wed 07 Nov)
10c/ World
Energy Outlook 2007 - China and India Insights
(IEA, Wed 07 Nov)
11/ Arctic
storm disrupts some North sea fields (Reuters, Wed 07 Nov)
**********************************************************************************************************
1a/ $100 oil within touching distance
(Arabian Business, Wed 07 Nov)
Comment: Nymex
Crude Future and WTI Cushing Spot have since fallen back to just above
$96/barrel. Still, that is one piece of bad news away from $100/barrel (a
severe storm over the
ITN news at10:30 pm covered Peak Oil, promoted the new
Peak Oil film “A Crude Awakening”, see item 2. In the interview with David
Strahan, David was careful not to mention the words “Peak Oil”. Fatih Birol,
chief economist at the IEA, was also interviewed, saying oil prices can go much
higher,
Article: Oil prices surged deeper into
record territory on Wednesday, touching $98 as the dollar plumbed new lows and
traders fretted about a winter fuel crunch due to thinning oil stocks and a
Investors bracing for more fallout from the US
subprime crisis and seeking shelter from the US dollar - which hit a new low -
have driven oil nearly $30 higher since mid-August and lifted other commodities
including gold, now at a 28-year high.
... Signs of thinning global oil stocks ahead of peak
winter oil demand have added fuel to the rally, aiding a nearly 8% rise over
the past two weeks alone, and prompting many analysts to say it's only a short
matter of time before the oil hits $100.
"We had the [
Although any bearish surprise there may trigger some
profit-taking, Kowalczyk said $100 appeared
inevitable.
... The US Energy Information Administration (EIA)
flagged the risk to winter supply on Tuesday, saying stocks in industrialized
nations would drop some 20 million barrels below the five-year average by the
end of this year amid robust demand and continued caps on output from
producer-group Opec.
The EIA, the statistical wing of the Department of
Energy, also sharply raised its forecast for
1b/ Average petrol cost at £1 a litre (BBC
News, Wed 07 Nov)
http://news.bbc.co.uk/1/hi/business/7082847.stm#petrol
Comment: The BBC is no longer able or
willing to discuss global oil demand outstripping supply / Peak Oil. The best
it can do, here, is mention speculators/investors,
Article: The average
A litre of unleaded petrol now costs 100.08p,
according to the latest data from industry researchers Catalist.
Petrol prices have risen sharply on the back of record
global oil prices, which have increased as a result of supply concerns and the
weak dollar.
Duty on petrol and diesel was also increased by 2p a
litre from the start of last month, further lifting prices.
The average price of a litre of diesel is now 103.32p.
Diesel broke through the £1 level two and a half weeks ago.
Petrol retailers have warned for some time of
escalating prices as wholesale crude prices soar and the impact of rising fuel
duty makes itself felt.
The weak dollar has driven up oil prices because some
investors have been using the commodity as an alternative to holding dollars.
On the other hand, it makes oil relatively cheaper for
anybody outside the
Recent oil supply concerns have centred on a number of
factors, including
1c/ Short-Term Energy Outlook – November
(US Energy Information Administration, Tue 06 Nov)
http://www.eia.doe.gov/emeu/steo/pub/contents.html
Comment: The EIA Short-Term Energy
Outlook is published monthly. November’s data was
released today. The two graphs on oil stocks (
Days of Supply of OECD Commercial Oil Stocks: http://www.eia.doe.gov/emeu/steo/pub/gifs/Fig11.gif.
See also “STEO Supplement: Why
Are Oil Prices So High?”: http://www.eia.doe.gov/emeu/steo/pub/2007-oil-prices.html
And the supplement
report: http://www.eia.doe.gov/emeu/steo/pub/special/2007-oil-prices.pdf
Figures 2 (OPEC Surplus Production Capacity Remains
Low) And 3 (OECD Commercial Stocks: Record Highs to Near Normal Levels) sum up
perfectly why oil prices are high just now, and could still have a long way to
go.
Article: Highlights
Global oil markets will likely remain stretched, as
world oil demand has continued to grow much faster than oil supply outside of
the Organization of the Petroleum Exporting Countries (OPEC), putting pressure
on OPEC and inventories to bridge the gap. Additional fundamental factors
contributing to price volatility include ongoing geopolitical risks, OECD
inventory tightness, and worldwide refining bottlenecks. As a
consequence, crude oil prices are expected to remain high and volatile.
... Total
1d/ As Oil Nears $100, Look Out Below
(Business Week, Wed 07 Nov)
Comment: Business Week following in
the footsteps of a substantial number of commentators, particularly economists,
who have for some time been saying that oil prices are high principally due to
speculators and are due for a big drop. No discussion of the possibility of oil
prices going up - why rising oil prices should stop at $100/barrel is not part
of the discussion. The fundamental problems of a falling US dollar and in
particular falling oil stocks, i.e. global oil demand outstripping supply,
barely get a passing mention in the first paragraph.
Article: Oil prices are soaring.
Having jumped 40% since August, crude prices hit another historic high on Nov.
6, rising to $96.70 a barrel. The factors sparking the $2.72 rally this time:
bad weather in the North Sea that could force production cuts, the dollar's
continued fall, more violence in the Middle East, and fears that
But is there a sharp fall just ahead? Analysts say
that the oil market looks overheated, and a number of factors could puncture
the price bubble. Most important, speculators have played a key role in driving
up crude prices this year, and if the trend reverses they'll get out fast.
Certainly, global demand remains strong for now. But a number of factors—technical indicators, an economic slowdown, lower demand—could prompt investors to exit en masse.
"Oil prices are in uncharted territory,"
says Peter Fusaro, co-founder of the
A Correction Is Inevitable
Beutel
says that regardless of the exit signal for investors, the oil market is due
for a correction. "Historically speaking we see that every time there is a
sustained vertical [price] rise, we see a 20% correction," says Beutel, adding that the serious threat of a recession could
take 40% off oil prices. "It's a beautiful thing that people forget: The
market moves more quickly on the downside than it does on the upside."
It's also possible that ballooning oil prices will
begin to fall when demand responds to price signals, as happened in the 1980s.
"The uptick in crude hasn't caused the same drag
on the economy as it did 28 years ago," says Ray Carbone,
owner of the trading firm Paramount Options. "But once we're past all-time
highs in oil prices, things could change."
1e/ What's behind the jump in oil prices?
(Energy Bulletin, Wed 07 Nov)
http://www.energybulletin.net/36863.html
Comment: Selection of articles
discussing the high oil prices.
**********************************************************************************************************
2a/ A Crude Awakening and Crude Impact -
http://www.odac-info.org/bulletin/bulletin.htm
Comment: From the ODAC Bulletin Board,
overviews of A Crude Awakening and Crude Impact. A Crude
Awakening is released at some cinemas in the
Article: A Crude Awakening (83mins) and Crude Impact (91mins) are both excellent Peak Oil films, and similar in style and content. They run thro a series of themes, listed below, interviewing various Peak Oil experts, some well known, a handful the same in both films, most not, breaking up the interviews with lots of excellent footage, and haunting music. Apart from these films, I have never heard of or seen Terry Lynn Karl (Professor of Political Science, Stanford University) before, but she is a very interesting speaker in both films, making the links between oil and wars, oil and poverty e.g. in A Crude Awakening: Darfur is an oil war; large, young population in Saudi Arabia with lack of jobs. Average income has dropped from $28,000 15 years ago to $6,000 per annum now. There has been a huge drop in the standard of living of the average Saudi. Prof Karl gives the impression that Saudi Arabia as a 'stable' state will not last much longer; two options for securing sufficient energy - militarise the taking of oil, or begin to prepare for the end of era of cheap oil, invest in alternative technologies. Both films discuss the history of oil and how we use it, geopolitics, and move on to Peak Oil and potential solutions. For the moment, if you want to buy a DVD to introduce your friends/ community to Peak Oil, you will have to settle for Crude Impact since A Crude Awakening is not yet available on DVD, but it is just about to start showing at cinemas in the UK (see details for buying/watching below).
…
A Crude Awakening was recently reviewed on the Lloyd's List website - Waking up to the truths of oil’s past, present and future.
Trailers
A Crude Awakening: The Oil Crash - trailer (YouTube, 2m 13s)
Crude Impact - trailer (YouTube, 2m 32s)
A Crude Awakening - The Oil Crash, Viewings throughout the
The award-winning Peak Oil film A Crude Awakening will be shown at public
cinemas throughout the
Crude Impact is available to buy as a DVD from the Crude Impact website.
2b/
“Slick, striking and sobering” **** Empire
“One of the most important films in years. An
absolute must see” Attitude
“Powerful and compelling”
Little White Lies
Produced and directed by award-winning European
journalists and filmmakers Basil
Gelpke and Ray McCormack, A CRUDE
AWAKENING: THE OIL CRASH tells the story of how our civilization’s
addiction to oil is putting it on a collision course with geology - everyday
this worrying phenomenon is made apparent as oil prices continue to increase at
an ever-increasing pace. The most important point is to make society aware of
this issue, which has previously been shielded from us, and to realise there
are very good reasons for investing and developing in new energy resources in
addition to the environmental concerns.
The conclusion is stark yet logical – our industrial
society, built on cheap and readily available oil, must be completely
re-imagined and overhauled.
The film opens THIS FRIDAY at the Curzon Soho (
Further information about the film can be found at www.dogwoof.com/crudeawakening
- please check the ‘Screenings’ page regularly at http://www.dogwoof.com/crudeawakening/screenings.html
to see when the film is playing near you.
We’re running
out.
And we don’t have a plan.
**********************************************************************************************************
3a/ Credit card users hurt by squeeze
(The Times, Tue 06 Nov)
http://business.timesonline.co.uk/tol/business/money/borrowing/article2814097.ece?EMC-Bltn=BEOBE4
Article: Nearly half of all shoppers
seeking new credit cards are being refused, as a money squeeze begins to hit
ordinary borrowers.
The number of applications refused by card providers
has risen by 17 per cent to an estimated 3.27 million in the past six months,
figures released yesterday showed, while those who are granted a card are being
forced to pay higher interest rates and charges. There have been 125 separate
fee and rate increases over the past two months.
Young people aged between 25 and 34 are most likely to
be refused a card, according to Moneyexpert.com, the price comparison website.
But financial experts said that people already struggling with debt would be
hardest hit by the clampdown...
3b/ Markets fear banks have $1 trillion in toxic debt
(The Independent, Tue 06 Nov)
http://news.independent.co.uk/business/news/article3132507.ece
Article: A new phase in the credit
crunch, one of “$1 trillion losses” seems to be dawning. The crisis at
Citigroup and renewed doubts about some of the world’s
leading banks disquieted stock markets on both sides of the
The FTSE 100 fell 69.2 to 6,461.4, with
Bill Gross, the chief investment officer of Pacific
Investment Management, said
... Meanwhile, on the continent, newspaper reports
named two German banks – WestLB and a small
specialised bank for professional people – as possible next victims of the
crisis.
3c/ Anatomy of a credit crisis
(The Independent, Tue 06 Nov)
http://news.independent.co.uk/business/analysis_and_features/article3132516.ece
Comment: Good overview of the Northern
Rock fiasco, starting off with the financial crisis in the
Article: ... But the
Securitisation allowed the Rock to generate cash and
unload risk by parcelling its home loans as bonds and selling them to willing
investors. When Adam Applegarth took over as chief
executive in 2001, the bank increased its growth rate in a grab for volume and
market share.
By this year, the Rock was tapping the markets for
nearly three-quarters of its funding – more than any other UK bank.
Since the bank’s near
implosion there have been plenty of voices saying they saw it coming. Yet
reliance on the booming credit markets meant Northern Rock’s
problem was not risky lending but reckless borrowing.
... After the freeze on 9 August, it became clear
Northern Rock was barely a bank at all. A senior source says: “Northern Rock
was a gigantic SIV.” Like a structured investment vehicle, Northern Rock issued
cheap short-term debt to fund longer lending for higher yields. While SIVs invested in US sub-prime securities, Northern Rock
sold mortgages.
And, as with SIVs, when
investors fled the markets the Rock struggled to refinance its debt as loans
matured.
The run on the Rock began more than a month before
queues formed outside branches, when its wholesale depositors stopped lending.
The Rock turned to the inter-bank market, but other banks were aware of its
problems and had reined in lending. The Rock was doomed.
... The ECB’s eye-catching
liquidity injections in early August appeared at odds with Mr King’s lack of intervention. But the ECB’s
net injection in August and September was zero. Instead it just changed the
timing of reserves because it believed banks would need more money at the start
of the month and less at the end.
... On 13 August, Northern Rock told the FSA it was in
trouble and the regulator set about trying to find a buyer. Talks with Lloyds
TSB gathered pace, but Lloyds was worried about funding strain as the credit
crunch bit. It told the Bank of England it would need up to £30bn of loans for
two years to do the deal. The tripartite authority refused the request on 10
September because EU rules meant the Bank could not give preferential treatment
to a single bidder.
... With no rescue deal and £27bn of Northern Rock’s debt to be refinanced by the end of 2007, the
authorities had to find a way to stop the wholesale run before the company went
bust...
3d/ Plunging markets fear a meltdown
(The Telegraph, Tue 06 Nov)
Comment: The latest from Ambrose
Evans-Pritchard. Grim.
Article: The peak pain for
A cascade of defaults will inevitably follow through
next summer and beyond, hobbling any recovery in the global credit markets for
months to come.
The losses are already bad enough. A study by Barclays
Capital found that 16pc of sub-prime mortgages taken out in January 2006 are in
default, and 28pc are in arrears beyond 30 days. Struggling to catch up, the
rating agencies downgraded a further $100bn of mortgage debt in October alone.
This mortgage debt – mostly packaged into
collateralised debt obligations (CDOs) and sold to
banks, hedge funds, insurers, and pension funds across the world – is tracked
by the ABX index. This shows that some of the AA tranches
have lost 20pc of their value, while the "toxic" BBB tranches have lost almost four fifths.
While it is hard to calculate the damage, it is clear
that roughly $2,000bn (£1,000bn) of sub-prime debt and related 'Alt-A' debt is
worth far less than book value.
... Deutsche Bank chairman Josef Ackermann warns that
total sub-prime losses are likely to be $150bn to $250bn, triple the bank's
estimate in July.
... The suspicion is that banks in
Suki Mann, a
strategist at Société Générale,
said the credit markets feared an "Armageddon scenario" once again.
"We're back to pre-September risk-aversion mode," he said.
Hans-Redeker, currency chief
at BNP Paribas, said the banks could not easily reveal their true losses.
"Our view is that these losses are so substantial that it puts current
business models at risk," he said.
... Eric Chaney, Morgan Stanley's euro-zone economist,
said there was now a risk of a manufacturing recession in
3e/ Why market turmoil will hit us all
(The Telegraph, Tue 06 Nov)
http://www.mediaplayer.telegraph.co.uk/?item=113213A5-15DC-493C-8E7B-4BDFA6BD1D27
Comment: Podcast. Ambrose
Evans-Pritchard, the pessimist, and Tom Stevenson, the optimist. Ambrose thinks
the big problems which will lead to higher inflation and higher interest rates are
here already, Tom a year or two away. ‘Peak pain’ in the USA housing market,
when teaser loans with low interest rates become high interest rates, will
occur March/April 2008, and monthly interest payments could double/triple.
Article: Despite the huge losses
announced by investment banks, and the departures of bosses at Merrill Lynch,
Citigroup and UBS, many analysts fear there is still more bad news to come.
Ambrose Evans-Pritchard and Tom Stevenson tell Robert Miller how they believe
that the volatility created by the credit crunch has further to run.
**********************************************************************************************************
4a/ GTL Progress Falters As Developers Weigh Success Of First Wave Projects
(
No link, newsletter.
Comment: It is difficult to see how
GTL projects can take off when global natural gas supplies are so tight, and as
long as we avoid economic meltdown, likely to get tighter. In its Natural Gas
Market Review 2007, the IEA lists 14 GTL projects (Table 4, p43):
Status 2007
No. of
projects
Existing
2
First Product
1 (Oryx)
Under
Construction 2
Advanced
Planning 1 (Oryx expansion)
FID Postponed
1 (FID = Final
Investment Decision)
Cancelled
1
Postponed
3 (all in
Speculative
3 (
Total no. of GTL projects operational or under
construction = 5
Article: A year ago the gas-to-liquids
(GTL) industry was in bullish mood, with the first two major full-scale
commercial GTL plants under development in
4b/
http://www.iht.com/articles/2007/11/06/business/pipeline.php?WT.mc_id=newsalert
Comment: Hurdles in the way of the
proposed Nord Stream gas pipeline, transporting gas from
Article: Fresh opposition emerged to
the German-Russian project to build a natural gas pipeline under the
The request, made last week in Oslo during a meeting
of representatives of the other five countries affected by the pipeline -
Denmark, Estonia, Finland, Germany and Russia - represented yet another blow to
the Nord Stream consortium, which is already facing
delays in obtaining construction permits for the project.
It follows a resolution last week by the European
Parliament, which urged EU governments and the European Commission not to
approve any new, large investments in infrastructure until a complete
assessment of the environmental impact had been carried out.
... But in Moscow, President Vladimir Putin, who along
with the former German chancellor, Gerhard Schröder,
has been at the helm of the project from the start, clinched a deal Tuesday
with Gasunie, the Dutch energy infrastructure
company. Gasunie becomes the fourth partner in Nord Stream, joining the German companies Wintershall and E.ON Ruhrgas, and
Gazprom, the state-owned Russian energy monopoly.
... Despite the celebrations in
... So far, none of the other countries affected by
the pipeline have issued permits either; they are awaiting the final opinion
from the UN Espoo Convention, which assesses the
environmental impact of projects involving several countries.
... Nord Stream had hoped to
obtain permits by the end of this year or next spring at the latest. But given
the necessity for public hearings over the environment and objections by
countries bordering the
He insisted the company would still be able to
complete the first phase of construction by 2010, when about 27.5 billion cubic
meters of natural gas, or 971 million cubic feet, are expected to be sent. The
second phase could be completed a year later, Müller
said.
According to Sergei Serdyukov, Nord Stream's
technical director, construction of the offshore link would be delayed by six
months, to July 2009.
**********************************************************************************************************
5/ Monty Don on Peak Oil and Gardening
(Transition Culture, Wed 31 Oct)
http://transitionculture.org/2007/10/31/monty-don-on-peak-oil-and-gardening/#more-791
Comment: Rob Hopkins at Transition
Culture / Transition Town Totnes continues to get the Peak Oil message across
in a most admirable way. Monty Don, the presenter of BBC’s
‘Gardeners World’, is one of many people who have been impressed by Rob’s talks, and become a Peak Oil convert himself. Monty
covers Peak Oil in the latest issue of Gardeners’ World Magazine.
Article: [After a detailed
introduction discussing how gardeners use oil products]
… There is a new book about to be published by Rob
Hopkins, called “The Transition Handbook: from oil dependency to local
resilience”. It’s a brilliant exposure of how
struggling to find alternative ways to keep on doing exactly what we’ve been doing for the past 50 years is absurd. He
believes that this crisis is an opportunity to make the world a better place,
with a higher quality of life for everyone.
The first point he makes is that we are reaching the
peak of world oil production right now. Oil won’t dry
up, but the cost of producing it will rise inexorably as it becomes harder and
harder to get at. Biomass, hydro, solar and wind power are useful but can’t possibly replace our current consumption of oil. It
would take 67 new nuclear power stations to do that. No, replacing oil is the
wrong way to go about it. It’s like trying to lose
weight by eating low-cal versions of your existing diet without altering your
lifestyle. We must all consume less of everything now. Instead of using up
diminishing resources, we must become resourceful.
This is easily said, but means some radical changes.
**********************************************************************************************************
6/ Peak Oil in the Mainstream Business Press
(The Oil Drum:
http://europe.theoildrum.com/node/3202#more
Comment: The Press and Journal (the
main daily newspaper in
CHAVEZ - BANE OF WASHINGTON, BLESSING FOR
where Brian Wilson, former UK Energy Minister, gives a
very sympathetic review of Chavez, and discusses the ties between
Energy website: http://www.energy.gb.com/index.asp?pkpage=1
Article:
The impression I have had for a number of years
(rightly or wrongly) is that “Energy” has favoured a fairly upbeat and
optimistic editorial line on our energy future – though the editor assures me
they have tried to carry a balanced perspective. In the November issue
published yesterday, three prominent stories caught my eye:
All peaked out and no place else to go but do-o-o-wn
Will the wheels drop off the biofuels wagon?
Simmons spells it out – but when will the ostriches
get their heads out of the sand?
Regular readers of The Oil Drum will be familiar with
these stories. The point here is that these are published in the mainstream
business press. There are excerpts below the fold plus links to the original
articles on line. This is good Oil Drum fare, and the article on biofuels, in
particular is worth reading…
**********************************************************************************************************
7/ Telling the Whole Truth About Oil
(Arab News [The
http://www.arabnews.com/?page=7§ion=0&article=103243&d=6&m=11&y=2007
Comment: This article does not contain
anything new, but unusual too see a Saudi media outlet discussing Peak Oil.
Article: If a diplomat is “an honest
man sent abroad to lie for the good of his country” (Sir Henry Wotton, 1612), then oil industry executives used to be the
business world’s equivalent of diplomats. The big
international companies were chronically optimistic about the extent of their
reserves, and state-controlled oil companies were even more prone to
exaggeration. But now we have the spectacle of oil companies telling the truth
about oil supplies — or at least more of the truth than usual. The occasion was
last week’s Oil and Money conference in
... It is still deeply unpopular in the oil industry
to talk about peak oil, but essentially what de Margerie was saying, albeit in
a cautious and coded way, is that it is here or nearly here.
... The recent surge in the oil price, which may see
it reach $100 a barrel in the near future, is largely a mirage caused by the
collapse in the value of the US dollar. (The price of oil is generally quoted
in US dollars, but cost of a barrel of oil in euros or yen has risen far less
dramatically this year.) But the longer-term trend, which saw the price rise
fivefold between 1999 and 2005, was driven by the tightening supply situation
as demand raced ahead while production did not.
It will get a lot worse if de Margerie is right, and
he almost certainly is.
**********************************************************************************************************
8/ Oil shale prospects
(Energy Resources Yahoo Group, Tue 06 Nov)
http://tech.groups.yahoo.com/group/energyresources/message/105930
Comment: Interesting post on the
Energy Resources Yahoo Group from Roger Arnold, on the viability of the western
Article: … One of the posts I tried to
reply to was Sheila's query regarding the size and viability of the western
That result can be looked at in several ways. The
viability of the operation becomes extremely sensitive to the method used for
power eneration. On the one hand, conventional power
plants using coal or oil to fire steam boilers are only about 33% efficient. So
if recovered oil is used to generate power for the operation in that type of
plant, it's totally and absolutely non-viable. All of the recovered shale oil
would have to be burned to generate the power consumed in continuing operation.
It becomes just a very expensive system for producing
waste heat.
... If the power input is limited to what can be
produced by local wind and solar resources, then the oil production will never
achieve very high volume. Not in terms of present levels of global demand. OTOH
[on the other hand], it does give western
**********************************************************************************************************
9/ COMMENT: Biofuels can match oil production
(Financial Times, Wed 07 Nov)
http://search.ft.com/nonFtArticle?id=071107000012&ct=0
Comment: The FTs
contribution to the Peak Oil debate – biofuels will solve the problems? No
mention of any of the current problems with producing biofuels.
“including the demise of the price-setting power of
the Organisation of the Petroleum Exporting Countries” Does
anyone believe OPEC still has price-setting powers?
Article: Peering into the future
seldom produces a clear picture. But this is not the case with bioenergy. Its long-term impacts on the global economy
appear to be pretty clear, making many long-term predictions quite compelling,
including the demise of the price-setting power of the Organisation of the
Petroleum Exporting Countries and the end of agricultural protectionism.
First, technology is bound to deliver a biofuel that
will be competitive with fossil energy at something like current prices.
... Second, the world is full of underutilised land
that can grow the biomass that the new technology will require.
... Third, even if only partially used, this large
potential biofuels supply will cap the price of oil because its supply is much
more elastic than the supply of oil.
... Fourth, the price of agricultural land will be
influenced by its potential use for bio-energy.
... Fifth, the increase in the price of agricultural
land and of food will relieve governments from the current political pressure
to protect the agricultural sector.
... Sixth, the countries that have the largest
endowment of under-utilised lands are in the developing world, especially
Africa and
... Bio-energy will make those infrastructure
investments socially profitable, creating a possible stepping stone into other
industries.
Some policy action in industrialised countries will be
required to make this world possible. Biofuels policy needs to stop being seen
through the prism of agricultural support policy - which justifies a 54 cents a
gallon US tariff on Brazilian ethanol - and instead become the purview of
energy and environmental policies. Standards will have to be developed to allow
the energy and automotive industries to co-ordinate technologies. To make this
scenario appealing, the impact of the expansion of the agricultural frontier on
the environment and biodiversity, and the distributive effects of the rise in
food prices will have to be addressed.
But these problems seem solvable given the expected
political benefits in terms of lower net carbon emissions, more energy
security, more efficient agricultural policies and greater opportunities for
sustainable development.
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10a/ Chinese, Indian Growth to Spur Oil `Crunch,' IEA Says
(Bloomberg, Wed 07 Nov)
http://www.bloomberg.com/apps/news?pid=20601087&sid=aP3OXSofGuFY&refer=home
Article: Chinese and Indian crude oil
imports will almost quadruple by 2030, creating a supply ``crunch'' as soon as
2015, the International Energy Agency said.
Oil investments of $5.3 trillion will be needed as new
sources pace slowing output from old wells, the IEA said. If investments aren't
made, this year's 61 percent surge in crude prices to more than $98 a barrel
may be the start.
``From 2012, oil supply will be tight, this is not
good news for anybody who wants to see an ease in prices,'' IEA Chief Economist
Fatih Birol told reporters in
10b/ Oil Prices: It Gets Worse (Time, Wed 07 Nov)
http://www.time.com/time/business/article/0,8599,1681362,00.html
Article: Oil prices hit a record high
of $97 a barrel on Tuesday, but the next generation of consumers could look
back on that price with envy. The dire predictions of a key report on
international oil supplies released Wednesday suggest that oil prices could
move irreversibly over the $100-a-barrel threshold in the not too distant
future, as the global economy faces a serious energy shortage.
