Matt Simmons on the Oil Market

Houston Chronicle: BP chief says another oil spike is possible

Oil executives and political leaders told a major petroleum conference Monday that the era of cheap energy is over and warned of another price spike if investment in oil production is curtailed.

“Prices are falling, but they’re falling for the wrong reasons: because of reduced demand and a consequence of reduced economic activity, not because we have increased supply or increased energy efficiency,” BP Chief Executive Tony Hayward said at the Abu Dhabi International Petroleum Exhibition and Conference.

( Click the subject line for the story )

Mandelbrot & Taleb Interview on PBS

Mandelbrot & Nassim Taleb on the credit crunch. Watch it here

Taleb is the author of "Black Swan: The Impact of the Highly Improbable"

Tractors for Stockbrokers, Maseratis for Farmers

Says Jim Rogers...

Answers From Schlumberger's Top Brass (SLB)

During the conference call held to discuss the quarter, Chairman and CEO Andrew Gould initial statements included:

• The deterioration in the credit markets will have an effect on its customers, but this will largely impact North America only.
• Management does not know the extent to which current events will hurt 2009 drilling activity.
• Management is still looking for a slowing in the rate of growth in customer spending - not a decline.
• Even if activity is curtailed, due to the "age of the production profile and the decrease in reserve replacement ratios", any significant slowdown in exploration and production investment will cause a sharp drop in production, which will lead to a recovery.

Gould and the other executives were then questioned, some may say "interrogated", by analysts as to the extent and duration of any downturn.

( Click subject line for the entire article )

Motley Fool: Why Oil Prices Will Rise Again

Back in July, around the time the oil price peaked, common consensus went
along the lines of ...
The world is running out of oil.
World demand for oil is high and only going to get higher still in the years and decades ahead.
Most of the world's cheap oil has already been discovered.
Oil exploration companies increasingly have to drill for oil in more and more
difficult places. This adds to the cost of exploration and in the event of a
discovery, the cost of extraction. Either the price of oil stays high and goes
even higher, so that it makes these new discoveries economical for the oil
companies, or the oil stays in the ground. Given the increasing demand and the
world's complete reliance on the naturally depleting natural resource called
oil, it has to come out of the ground.
Oil was seen as a natural hedge for the falling U.S. dollar.

Click the subject line for the link to the Motley Fool article

OPEC Calls Emergency Meeting

IHT: OPEC calls emergency meeting as oil prices fall

Oil prices dropped below $70 a barrel for the first time in 14 months Thursday, prompting the OPEC cartel to call for an emergency meeting next week to establish some stability in prices that have plummeted recently after rising for months.

Oil prices have tumbled by nearly $40 a barrel in just three weeks as indications grow that demand for energy will slow along with weakening economies around the world. As recently as July, oil was trading at a record of $145 a barrel.

The decline in oil prices could provide a form of stimulus to the global economy as consumers pay less to fill up their tanks. If oil prices stay at current levels, American consumers would have $250 billion more, over a year, to save or spend elsewhere, according to Lawrence Goldstein, an energy economist. Some analysts expect oil prices to keep declining, perhaps to as low as $50 a barrel in coming months.

All worries about oil going to $25 is misplaced. While it is true that the price of oil has collapsed more than 50%, it is still higher than where it was just 14 months ago. Just for comparison try the Dow or S&P at multiyear lows.

Oil price still don't reflect a global depression. While a serious global slowdown is on the cards, it will come nowhere close to a depression. Money printing is rampant, the deleveraging will pass and inflation will be sticky.

Many alternative energy startups will go bust, oil sands and deep sea drilling would become unprofitable. Which means there will be severe limitation on future supplies at lower prices, which is price supportive.

At some point all those Asian countries with dollar reserves are likely to use it to stimulate their economies and that is dollar negative. Once the warp speed deleveraging is close to over, the dollar rally will be over as well.

Poll: Whither Price Of Oil?

Collateral Damage

Chesapeak CEO Sold All Stock to Meet Margin Calls

Chesapeake Energy Corp. said its chief executive officer, Aubrey McClendon, involuntarily sold ``substantially all'' of his common shares of the company's stock over the past three days to meet margin loan calls.

``These involuntary and unexpected sales were precipitated by the extraordinary circumstances of the worldwide financial crisis,'' McClendon said in today's statement. ``In no way do these sales reflect my view of the company's financial position or my view of Chesapeake's future performance potential.''

McClendon, 49, owned 33.5 million shares, or 5.8 percent of the company's common stock, according to a Sept. 30 filing with the U.S. Securities and Exchange Commission. He was the company's third-largest shareholder.

Chesapeake, this year's worst-performing petroleum producer in the Standard & Poor's 500, fell 6.7 percent in New York trading today amid concern hedging contracts won't protect the company against a plunge in natural-gas prices. McClendon's divestiture was announced after the close of regular trading on U.S. stock markets.

``You have to imagine Aubrey's lost a large portion of his fortune,'' Benjamin Dell, an analyst at Sanford C. Bernstein & Co., said today in a telephone interview. He rates the stock at ``market perform'' and owns none.

The Oil Drum has a good thread on this

Admission of Guilt! A Reply to Mish

Mish over at the Global Economic Analysis asks the following in the comments section:

“Can I ask a question?

With oil at $84 ....
Where is Oil Shock?

Mish
Like this comment?
link to the post

Oil Shock was indeed wrong. Yes, I called the bottom at $90 for oil. It was indeed the bottom until Oil declined one more time. Yes, so far it about 7% below that price. I still have called a perfect bottom in gold. Dollar index is about 2% higher than my prediction top.

Australian Dollar cliff dived yesterday, partly due to the unwinding of the carry trade. Just two months ago, the Ozzie was at near parity with the USD, but today you could buy 1 Ozzie for 64 cents U.S. Do you think Australian economy is fundamentally a lot weaker than the U.S economy? Do you think what happened to Iceland and Australia are impossible to happen here?

Much of the strength in dollar index is due to the weakness of Euro, it is not an indication of Dollar strength. Euro is a doomed currency. I heard somebody put it as the Deutsche Mark + some parasites, and that is very true.

Was my bottom and top calls based on any specific formula? No. It was just rhetoric meant to say that inflation is still in play. Did I strongly believe in my prediction? Yes I did. Did I know that for 100% sure that Oil will bottom at $90.00, and Gold at $750? No I did not.

As for all those deflationary derivatives worth 500 trillion floating around, it is all hogwash. Derivatives can go to zero and 80-90% of them do, even in a bull market. Have you read stats on options? Most of them go to zero? If one were to really believe that those derivatives are part of the money supply, what do you think the price of a refrigerator full of groceries would be?

Is there an unwillingness to lend right now? Yes. But all the debt will be monetized away, and some more will be accumulated by the local, state, and federal governments and monetized.

Stop kidding yourself. Oil at $84 is a lot higher than were it was, when Mish started denying that inflation was non-existent, go back, he has a lot of charts and graphs starting from 2005 to prove his point.

Mish has been consistently wrong for many years with his predictions, and yet he needs a great deal of credit for predicting the crisis very accurately as it unfolded. There were a lot of guys predicting shallow recessions, muddle throughs etc. But Mish could see a lot further than those others; he predicted a deeper recession. He was just a little early. Mish is still wrong about deflation.

Real wealth is ability to produce real goods, and that is one area that American economy lacks clearly. Yes, America has a lot of productive capacity, but no where close the purported size of the economy. So, what really is backing our dollar? yes,a lot of productive capacity, and a lot more of hot air.

Middle East Oil Consumption and Exports

CIBC world markets chief economist Jeff Rubin discusses with Erin Burnett and Larry Kudlow of CNBC.

Cool It

If you have exposed yourself to jet set/carbon trader/gazillionaire Al Gore's global warming propaganda (I have), you owe it yourself to know the other side of the debate( debate is hardly over ). I found this book very interesting - "Cool It: The Skeptical Environmentalist's Guide to Global Warming ".

Or you could watch "The Great Global Warming Swindle". It is free on video.google.com

Or you could read this short article - "I was on the global warming gravy train".

After having observed the environmentists for a while, I have come to the conclusion that environmentalism is a religion, a very intolerant one. According to the environmentalists, if you refuse to dogmatically follow the Gaia any other intolerant enviro-doctrine, you will fry along with the rest of the planet. In that respect, environmentalists are very similar to evangelicals - they both peddle salvation.

Radical environmentalists believe that the earth's human carrying capacity is about 400 million. They hope and pray for a massive human die-off that will reduce the population by 90% ( Oil Shock is not making this up ). Their view of the human race is akin to that of a virus/disease that should be stopped.

In other news from the energy universe, protests in europe turn violent

(Images courtesy of Mish's global economic analysis )

Carbon control treaties were meant to raise the price of fuel and reduce consumption. Now that the treaty getting closer to achieving its stated goals, the carbonistas don't like the outcome.

It is even silly to believe that a bunch of Soviet style central planners could just press a few buttons, pull a few levers and there by command and control the global climate.

Am I suggesting that the environmentalists the only reason for the pain at the pump? Not at all. But the NIMBY/BANANA groupies are adding to the troubles.

Matt Simmons on Bloomberg

Simmons discusses Saudi Arabia, Gas prices, Oil prices, Peak Oil etc.

Oil Shock is here!

"Inflation is always and everywhere a monetary phenomenon" - Milton Friedman.

It is not the price of things that is going up, it is the value of money going down. See the chart. (Money supply in green and Gasoline price in Red). Price of gasoline futures are up a good 14 cents, just today.

I believe there is enough evidence to suggest that peak oil is here. But the mainstream public or the financial markets have not bought it completely. There has not been any serious declines in global oil production. Given that scenario, peak oil alone could not possibly explain the current prices.

Oil is bubbling according to the "experts", at the moment. It would seem as though it will climb until it breaks the back of the U.S economy. Prices are likely to be higher 2-3 years from now, regardless of whether it goes down in the near term. Peak Oil come to mind. An attack on Iran and all bets are off.

Bernanke's "strategy" of bailing out crooks through inflation, is clearly not working. Benny is not as fortunate as his predecessor - when greenspan expanded money supply, the price of stocks, bonds and housing (later on) went up. Now, real tangible things have a lot of catching up to do.

Peak Oil Debate Will Rage ( Telegraph UK )

The debate over the cartel's capacity rages as American legislators look to make it pump more black gold, writes Elizabeth Eldridge

It takes a staggering 20 million barrels a day to feed America's addiction to oil. Two thirds goes on keeping America on the move. And, with fuel costs at record levels, the nation's car drivers, airline travellers, haulage firms and train companies are feeling the squeeze.

Boone Pickens on Price oil, alternatives and Speculation

Here is the video link

Robert Hirch on CNBC

Hofmeister vs Simmons

Shell CEO Hofmeister on Peak Oil & Simmons


Matt Simmons Responds -

Peak Oil: What could it mean for Vancouver?

Warren Buffet on Peak Oil and resource depletion

Riding the oil age.

Bird & Fortune on Iraq & Oil

Hilarious - Enjoy.

Global oil production peaked last year - Boone Pickens

Oil continues to rise

Oil price - Outlook

Peak Oil Linkfest - 09/29/07

New York Times: Rising Food Prices Lead to Less US Food Aid

A U.S. newspaper says rising food prices have helped cut U.S. food aid to its lowest level in a decade, and have possibly resulted in more hungry people around the world.

The New York Times cites data from the U.S. Department of Agriculture showing the United States has bought less than half the food aid this year than it bought in 2000.


Lifestyle changes prepare locals for energy changes

Michael Brownlee wants to help you change your life.

The head of Boulder Valley Relocalization has a radically different view of the future, one in which the daily gridlock on U.S. 36 would be a thing of the oil-guzzling past, where farms would dot large swathes of Boulder County open space, Kentucky bluegrass would give way to food crops in suburban yards and businesses would plant rooftop gardens. Solar panels and other renewable energy would supply a large portion of the community's energy. Local businesses would meet many more of the citizenry's daily needs, and customers could even choose to use a local currency.


Peak Oil Passnotes: Neo-Peak Oil

If we think of peak oil as a subject in itself, rather than a subset of general discourse about oil and energy, then we can see it has been around for something approaching 100 years. After World War One there was sustained and popular debate about the prospect of the U.S.’s valuable resource running out. After all there was no more to be found and it was going to be too expensive anyway.

This debate has been repeated a few times since then, most notably in the 1970s, but it has never been stronger than it is now. Nor has it attracted such a wide range of people willing to discuss it.


Al Gore's climate change film 'is propaganda'

Al Gore's climate change documentary, , contains "serious scientific inaccuracies, political propaganda and sentimental mush", the High Court in London has heard.

The attack came as Stewart Dimmock, 45, a father of two, challenged the Government's decision to provide every secondary school in England with a copy of the former American vice-president's film as part of an environmental campaign.


Technological Advances to Quench Thirst for Oil

Oil markets are in turmoil, admits Saudi Minister of Petroleum and Mineral Resources Ali Al-Naimi in an interview in New York. With Saudi Arabia currently accounting for almost one-fifth of global crude exports and analysts expecting it to meet a quarter of the world's increasing crude thirst in the near future, the global dependence on Saudi Arabia is set to go up. As the only producer with significant excess capacity, the Kingdom has played a crucial role in alleviating temporary supply disruptions and crises. The Kingdom upped its 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. It was crucial in balancing the global markets then. With geopolitics occupying center stage, the Saudi role would stay crucial to the global well-being.


Global Warming: The Great Equaliser

As the latest summit to discuss a post-Kyoto treaty continues in New York this week, the single most revealing statement has already been spoken: “We need to climate-proof economic growth”. These few words, told to reporters by the UN’s top climate official, Yvo de Boer, during the recent Vienna round of talks, define the blinded establishment approach to tackling climate change.[1] Only if continued trade liberalisation and corporate profits are kept sacrosanct, remains the assumption, is it possible to consider even a broad agreement on future cuts in greenhouse-gas emissions.

Split in group delays vote on sanctions against Iran

The United States, Britain and France chose unity over speed and agreed on Friday to delay until November a United Nations Security Council vote on a third sanctions resolution against Iran.

The delay, a concession to Russia, China and Germany — the other three countries in the fragile coalition of six world powers that are seeking to rein in Tehran's nuclear ambitions — came after a week of haggling on the outskirts of the General Assembly. The six countries issued a statement advising Iran that a diplomatic offer of economic incentives remained on the table if Iran suspended its uranium enrichment program.


Ethanol, schmethanol

SOMETIMES you do things simply because you know how to. People have known how to make ethanol since the dawn of civilisation, if not before. Take some sugary liquid. Add yeast. Wait. They have also known for a thousand years how to get that ethanol out of the formerly sugary liquid and into a more or less pure form. You heat it up, catch the vapour that emanates, and cool that vapour down until it liquefies.


Modeling Oil Production to Estimate URR - Saudi Arabia, Kuwait and World

This is a guest post by Apparent Peak. He started his career as an aeronautical engineer and is currently retired. Now he has more time to study peak oil and write posts for TOD. He has selected "Apparent Peak" for his handle which will become obvious once you have read the post.

1) Background

I have followed the subject of peak oil since the seminal article by Campbell and Laherrère appeared in the March 1998 edition of Scientific American. Approximately one year ago, I began to casually follow some of the discussion threads at TOD. The posts, the ensuing discussions and in particular, discussions on HL, logistic functions and Khebab's The Loglet Analysis caught my interest. I decided to investigate these topics since I did not know what HL was, let alone logistic functions. A quick trip to Wikipedia explained the Logistic function. As it turns out, it is a fancy exponential function that has characteristics similar to the Gaussian distribution.


Alan Greenspan vs. Naomi Klein: who has rights to Iraq's oil?

US Federal Reserve chief Alan Greenspan famously spills the beans in his new memoir, The Age of Turbulence: "I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil." (London Times, Sept. 16) On her blog Sept. 25, Arianna Huffington lauds leftist icon Naomi Klein for calling out Greenspan on this point in a Sept. 24 interview with him on Democracy Now: "Are you aware that, according to the Hague Regulations and the Geneva Conventions, it is illegal for one country to invade another over its natural resources?" (Contrast Ann Coulter's "Why not go to war just for oil? We need oil! What do Hollywood celebrities imagine fuels their private jets? How do they think their cocaine is delivered to them?")

Oil Reaches Record High, Closes above $80

Peak Oil Linkfest - 07/28/07

Oil Rises on Signs U.S. Gasoline Supplies Dropped a Fourth Week

Crude oil in New York rose to the highest close since Aug. 15 on speculation that U.S. gasoline supplies declined for a fourth week.

Gasoline supplies fell 2.3 million barrels in the week ended Aug. 24, according to the median of responses by 10 analysts surveyed by Bloomberg News. The crude-oil market often follows gasoline during the summer. Prices were down earlier on speculation that subprime-mortgage losses in the U.S. will spread through the economy, reducing growth and demand for fuels.


The Gasoline Crisis in Iran

In late June 2007, the Iranian government launched a comprehensive gasoline rationing policy, necessitated, in part, by the growing demand for gasoline in Iran's domestic market that could not be met by its oil production infrastructure.

Although Iran is among the world's major exporters of crude oil, it has limited processing and refining facilities, and thus must import most of its refined oil for domestic use. There has been no significant investment in developing its oil refining facilities since the Shah's era, and Iran depends entirely on imported gasoline.


Tomgram: Dilip Hiro, America on the Downward Slope

Pick up the paper any day and you'll find tiny straws in the wind (or headlines inside the fold) reflecting the seeping away of American power. The President of the planet's "sole superpower" and his top diplomats and commanders have been denouncing Iran for months as the evil hand behind American disaster in Iraq as well as Afghanistan.


Energy Report is Handgrenade in Bubblewrap

The working draft of the National Petroleum Council’s forecast of global oil and gas trends runs to nearly 500 pages. Weighing as much as the chunk of foam that brought down the Space Shuttle Columbia, this curious document reads like a hand grenade encased in Bubble Wrap. Since its release, the report (and a more digestible 40-page executive summary) has received 750,000 hits. (www.npc.org.).

Facing the Hard Truths About Energy is perplexing, even schizophrenic. In maddening fashion, it blends numerous cautions about the “accumulating risks” to global oil and gas production with repeated, rosy reassurances that we “aren’t running out,” as if anyone said we were.


The last straw? Alongside debt, rising food prices threaten industrial growth

Just when the world economy seemed to have found immunity to rising world fuel prices, the rising world grain price may be the shock that finally ends its long upturn, as costlier food baskets eat into household budgets.

A surge in world oil prices - to over $70 per barrel this month, almost double the level of two years ago – has not caused a return to the production downturns and price rises (‘stagflation’) that followed previous petroleum shocks in 1973 and 1979. The global economy continues to grow strongly, with emerging markets expanding fast and a pick-up in the EU offsetting signs of slowdown in the US. Relocation of industrial production, and a widening range of services, to low-cost countries is suppressing northern hemisphere inflation rates. Among the biggest of the emerging markets, Russia’s boom is being fed by oil, China’s is still largely powered by coal, Brazil is rapidly substituting its fossil energy needs from biofuel, and India’s rising exports and capital inflows have stopped its growth being checked by rising oil demand.


Meat prices set to soar as production costs mount: analyst

The price of meat may soon increase as production costs mount and demand outstrips supply, a British analyst said Tuesday.

Richard Crane, a London-based analyst with the consulting firm Deloitte, said beef, pork and poultry producers are struggling with rising feed costs. Grain prices reached an unprecedented peak of $7.44 U.S. a bushel on the Chicago Board of Trade market last week after climbing steadily for months.


How Weak Dollar Affects OPEC

When oil price spikes have occurred in the past, the Organization of the Petroleum Exporting Countries has quickly increased supply, taking advantage of the high U.S. dollar selling price, but also thereby eventually driving down the oil price, making Americans and everyone else who uses oil happy.

But now, even with oil prices nearing a record high, opec is not stepping up production. Why?


OPEC has set unofficial target price of 70 usd per barrel for oil - IEA

OPEC has set an unofficial target oil price of around 70 usd per barrel, which could weigh on growth, said Claude Mandil, director general of the International Energy Agency, in an interview with the Arab Oil & Gas monthly.

'The market has become aware' that OPEC 'has set an implicit new objective of keeping prices at or around 70 usd per barrel and that the organisation is trying to defend this level,' said Mandil.


July oil output drops at Mexico's Cantarell field

Crude oil output dropped in July at Mexico's aging Cantarell offshore field, according to data published on the energy ministry's Web site on Monday. Cantarell, closely watched by the oil industry after sharp dips in output in recent months, produced an average of 1.526 million barrels per day versus 1.570 million bpd in June.

The figure meant Cantarell accounted for just 48.2 per cent of Mexico's overall crude oil output last month, continuing a steady decline over the past year at the field, which once produced around 60 per cent of the country's oil.


The end of oil is not a possibility but a certainty

Regardless of how long you've been alive, whether you're 16 or 60, it's never been a problem to get gasoline. The ability to fill our gas tanks has often felt as guaranteed to Americans as free speech and free press. However, the privilege of gas may become a thing of the past quicker than we may think.

There is one fact often overlooked when dealing with the issue of oil and that is this: We cannot make a finite resource infinite.


How Corn Ethanol Could Pollute the Bay

Despite rising food prices, it seems that nearly everyone is turning to corn-based ethanol as their choice for alternative fuel. Hidden behind these headlines, though, is an equally important but less visible cost: water pollution.

Corn is a "leaky" crop, losing more nitrogen per acre than most other crops. In the Washington region, much of this excess nitrogen ends up polluting the Chesapeake Bay and robbing fish, crabs and oysters of oxygen.

Energy Briefs : From Peak Oil Review

• The Yemeni government's share of the country’s oil output declined by 42% in the first half of this year. Total oil production fell to 20 million barrels in the six months to June 30 from 34.5 million barrels in the year-earlier period
• Lebanon is on the verge of a blackout within three to four days due to the lack of fuel in most of the power stations. Rationing of electricity consumption began in Beirut and areas in the north and south regions of the country, with suspension periods reaching over 14 hours a day,
• The median price of American homes is expected to fall this year for the first time since federal housing agencies began keeping statistics in 1950.
• Cultists killed 20 people in Rivers state, Nigeria leading to imposition of a curfew. Since January, 2006, armed gangs have abducted more than 200 local and foreign oil workers in the Niger Delta. Total SA fired a geologist earlier this month after he refused a job in Nigeria.
• Saudi Arabia's domestic oil consumption last year grew by 6.2 per cent to 2 million b/d up from 1.89 million b/d in 2005. Analysts attributed the growth to the surge in economic development, especially the decision to set up economic cities, industrial estates and IT parks in different parts of the Kingdom.
• Chevron's largest U.S. refinery continued production at reduced levels while teams assessed damage caused by a fire last week. There are already reports that crude shipments to the refinery have been diverted elsewhere.
• Refinery maintenance in Europe next month is expected to shut in about 630,000 barrels of oil a day, double the amount of production that was idle in August. Globally, the number of refineries undergoing scheduled maintenance is expected to increase in September, with around 1.85 million barrels a day off line.
• Kazakhstan's environment ministry has ordered a halt to all work at the giant Kashagan oil field in the Caspian Sea, which is being developed by an Eni-led consortium, over violations of the country's environmental laws. ENI’s CEO said "friendly negotiations" with the Kazakh government over the Kashagan oil field will begin today.
• OPEC's newest member Angola is likely to stay free of the group's output constraints so long as oil prices remain strong, giving the country scope to start up several new oilfields in coming months. Under the most optimistic estimates, Angola could reach 3 million bpd by the end of 2010.
• Japan is forming a program that will allow countries in East Asia to share oil reserves in the event of a disaster. The Ministry of Economy, Trade and Industry believes that an emergency-oil-sharing program in East Asia, where demand for oil continues to soar, will help stabilize oil prices and the region's economies when shortages hit.
• Venezuela exported to the US an average of 1.31 million b/d of crude oil and byproducts in June, a drop of 202,000 bpd, or 13.2 percent, compared with May.
• Venezuela’s parliament has given initial approval to reforms proposed by President Chavez, including an end to presidential term limits. The proposals still require a final endorsement by parliament, and must then be put to a referendum.
• GM may build as many as 60,000 of its Volt electric cars for their inaugural year on the market. Production at that level may allow GM to sell the plug-in Volt for less than $30,000.
• Myanmar authorities moved swiftly to crush the latest in a series of weeklong protests against fuel price hikes.
• Global warming will cut China's annual grain harvest by up to 10 percent by 2030, state press reported. China will likely need an extra 10 million hectares (247 million acres) of farmland by 2030, the year that China’s population is expected to peak at 1.5 billion people.
• U.S. natural gas storage grew last week and is about 13 percent above the five-year average for this time of year. Forecasts for warmer-than-normal early winter temperatures may chill the prospects for a rally in U.S. heating oil and natural gas futures prices.
• BP said it may be forced to cancel plans to increase the use of Canadian crude at its giant Whiting refinery if it can't appease environmentalists in a way that maintains the project's "viability." The company was recently granted a permit from Indiana to allow for higher wastewater discharge limits as it prepares for the $3.8 billion upgrade project.
• Alberta's revenues from selling exploration rights have slumped more than 60% so far this year. The drop was caused by low natural gas prices, rising oil sands development costs and weak equity markets.
• Landowners in north-central Alberta will be voting on a proposal to build Alberta’s first nuclear power plant. Energy Alberta was established in 2005 to bring nuclear technology to the province. The company says it has lined up financing and clients. Environmental groups have expressed concern about the proposed facility saying the nuclear reactors require huge amounts of fresh water and have a serious problem disposing of nuclear waste.
• A climate-change bill from the House Energy Committee will be a hybrid of ``cap-and-trade'' and new carbon taxes, said Rep. John Dingell, the measure's main sponsor. According to Dingell, the bill, expected next month, would cut greenhouse gas emissions by 60 percent to 80 percent by 2050. The Committee is also proposing a cutoff of mortgage-interest tax deductions for all houses with more than 3,000 square feet.
• Nicaragua’s U.S. ambassador insisted that the government immediately return a storage terminal seized from Esso, saying the takeover threatens foreign investment and is a ploy to promote Venezuelan petroleum products. A judge embargoed the assets owned by Exxon-Mobil, on Aug. 18, saying the company owed $3 million in taxes, which the company denies.
• Militant groups have formed a coalition in preparation for another round of kidnapping of foreign workers and bombing of oil installations in the Niger-Delta beginning the first week of September. Their complaint remains that the government and oil companies have failed to meet their demands for development of their areas.
• A nuclear cooperation pact Iran struck with the International Atomic Energy Agency has "real limitations" a senior U.S. official said on Wednesday. Washington was not impressed by the promise of Iranian transparency -- hailed as a "milestone" by the IAEA .

Peak Oil Linkfest - 08/24/07

Economist Sees Peak Oil Near

Peak oil, the point at which production of oil worldwide begins a progressive decline, is probably coming soon, economist George Littel told members of the Kansas Independent Oil and Gas Association at their annual convention this morning.

Further, Littel said, when peak oil arrives it will be an economic, not a geologic, event because demand for energy is a strong driver of new exploration and production.


Current global challenges and alternative energy futures for South Africa

The combined effect of depletion of global oil and natural gas reserves, climate change and global monetary imbalances and financial instability is likely to have significant impacts on the global and South African economies throughout the 21st Century.

These impacts are likely to include far reaching consequences for energy, food security, settlement patterns and social stability.


Corn, ethanol rush relies on dwindling water

The field came to life in the August wind, dense stalks swaying in tandem, silky tassels swirling like so many kite tails in the sun.

Duard Fix shouldered his way through the lush stand, stopping to break off and husk a prize he'd been waiting for since May: The perfect ear of corn — nearly 800 light yellow kernels in 16 neatly symmetrical rows.


Saudi domestic oil consumption up 6.2pc in ’06

Saudi Arabia's domestic oil consumption last year went up by 6.2 per cent to 2 million barrels per day (bpd) from 1.89 million bpd in 2005 in the wake of economic boom, while its oil production for the international market declined by 2.3 per cent during the same period, according to the ŒBP Statistical Review of World Energy June 2007' released recently.

Economic analysts attributed the growth to the surge in economic development, especially the decision to set up economic cities, industrial estates and IT parks in different parts of the Kingdom.


Iran's hangmen work overtime to silence opposition

Stonings, hangings, floggings, purges. President Mahmoud Ahmadinejad might claim that United Nations sanctions can't hurt his country, but that is not how it feels for Iran's long-suffering population which now finds itself on the receiving end of one of the most brutal purges witnessed since the 1979 Islamic revolution.

The most visible manifestation of the new oppression sweeping Iran has been the wave of public executions and floggings carried out in Teheran and provincial capitals over recent weeks in a blatant attempt by the regime to intimidate political opponents. The official government line is that the punishments are part of its "Plan to Enforce Moral Behaviour".


World oil prices climbing again

Crude oil prices rose on Thursday after earlier losses as a steady stock market performance alleviated worries about dampening consumer demand caused by the slowdown in economic growth.

On the New York Mercantile Exchange, light sweet crude for delivery in October closed 57 cents higher at 69.83 dollars per barrel. In London, the price of Brent North Sea crude for October delivery settled 1.16 dollars higher at 69.86 dollars per barrel.


Industrial Agrofuels Have No Future; Does Food?

The E.U. has set absurdly high targets for agrofuels in its transportation fuel mix. By 2020, the E.U. intends to sate 10 percent of its transportation demand with agrofuels, and it is counting on cellulosic ethanol for most of that new fuel.
It won’t work. Advocates claim that cellulosic ethanol has a positive energy return – that is, the magnitude of energy required for biomass production and conversion is smaller than the magnitude of energy displaced by the ethanol produced. And this claim has been carefully crafted to convey the idea that (a) cellulosic ethanol can replace fossil fuels, and that (b) we should be happy with this new technology, because cellulosic ethanol is an energy-positive fuel and therefore, the more we drive the more we save.


The Peak Oil Crisis: Hurricanes and Meltdowns

Earlier this week Hurricane Dean slammed into the Yucatan peninsula and crossed over into the Bay of Campeche where some 1.5 million of the 10 million barrels the U.S. imports every day are produced. While it is too early for a full damage assessment, at best a few days of production will be lost and possibly quite a bit more if any of the production platforms, pipeline systems and nitrogen injection facilities have been damaged.


"Peak oil" becomes burning issue

Swiss scientists say politicians and the public should have a greater awareness of "peak oil" – the moment when the world's maximum crude oil output is reached.
Researchers at Basel University warn that although climate change is grabbing more headlines than the possible exhaustion of fossil fuels, a conflict is brewing over crude oil.

This suggests that U.S. imports will be less than normal over the next few weeks. While some of these imports might be made up by increased shipments from other countries, the tight overall oil market suggests that this will be difficult.


Share slump and credit crunch: passing peak oil

Regular readers may be surprised to see me offer commentary on the financial markets, given my dim view of such factories of speculation and greed. This is no sideshow, however. The unfolding turmoil may eventually be seen as a historic event. Another turning point, the worldwide peak in oil production, is a key player in this unfolding drama, although its role goes unnoticed by most in the audience.

Peak Oil Update - 08/18/07

Making do without

The growing recognition that the world is at or nearly at the all-time peak of conventional oil production (meaning from that point on, oil flows will inexorably decline at some unknown rate) has prompted a furious search for replacements, all intended to keep the high-carbon, high-flying, automobile lifestyle going.

Like crack addicts warned of a future shortage, we are literally searching the corners of the Earth to figure out how we're going to get our fix when times is tight.


The latest from peak oil land: ponies and lollipops!

I don't do much writing about peak oil here. It's horrifically depressing, for one thing, and for another I doubt I could add to the comprehensive work being done at the Oil Drum and elsewhere. That's my excuse and I'm sticking to it.

If you're like me and you only tune in to the issue occasionally, check out the latest from Michael Klare over at TomDispatch: "Tough oil on tap." It's a nice, fairly concise roundup of the latest reports and news from the peak oil world. And yeah, it's depressing. Here's the conclusion:


U.S. Tough Talk on Iran: A Sign of Isolation

Washington's reported plan to name Iran's Revolutionary Guards as a "specially designated global terrorist" organization may be less about raising pressure on Tehran than about raising pressure on U.S. allies to support a tougher line with Iran. In fact, the move reflects Washington's relative isolation on the question of how to deal with Iran. The New York Times reported Wednesday that the move is primarily directed at appeasing Bush Administration hawks and U.S. legislators who have been agitating for a more aggressive posture on Iran, and at turning the screws on European allies who are reluctant at this stage to escalate U.N. sanctions on Tehran over its nuclear program.


Tomgram: Michael Klare, Tough Oil on Tap

News stories just out report that the Bush administration is planning to designate Iran's entire Revolutionary Guard Corps a "specially designated global terrorist" in order to tighten sanctions on that country. This follows a many-months-long drumbeat of U.S. claims against Iran -- for arming not just Shiite militias (and Sunni insurgents) with the most sophisticated roadside bombs to attack American troops, but the Taliban as well (an especially unlikely charge).


Oil Gains as Storm, Weather System Threaten Gulf Oil Production

Oil rose more than 1 percent in New York, the biggest gain in two weeks, on concern a tropical storm and a separate weather disturbance may damage oil platforms and pipelines in the Gulf of Mexico.

Royal Dutch Shell Plc evacuated staff from the Gulf as a precaution because of a tropical disturbance near the Yucatan Peninsula. Atlantic Tropical Storm Dean may become a hurricane by the end of the week, the U.S. National Hurricane Center said. In 2005, hurricanes Katrina and Rita decimated platforms and pipelines along the Louisiana and Mississippi coasts.


Global Warming Is A Hoax Still Read

GLOBAL WARMING IS A HOAX STILL REAL....Remember the big foofaraw a few days ago when a global warming skeptic finally found a bug in some U.S. temperature calculations? 1998 was no longer the hottest year on record! The United States is cooler than it was in 1934!

All this was over a small Y2K correction that lowered a few years of data for the U.S. by about a tenth of a degree. And what about the correction for global warming? Well, it's in the chart above.


Analysis: evidence still shows global warming

The wrongly calculated temperature statistics have left Nasa with egg on its face, but should have little long term effect beyond handing global warming-deniers a propaganda coup.

However embarrassing the oversight may have been, the adjustment to the temperature records from the United States is a matter of hundredths of a degree and does not alter the overall trend.


The Oil Patch Cheers On Hurricane Dean

The price of crude oil is down some 8 percent since August 1. What the oil patch and every oil trader knows, one of the quickest ways to turn around this tumble is the drama of a good old fashioned hurricane in the Gulf of Mexico wending its way toward the Texas and Louisiana coasts. And Shazam! Here comes Hurricane Dean!

Hurricane Dean's every little ripple will be reported by the oil industry flacks and their willing mouthpieces in the media. The crescendo of ominous events will be forecast and analyzed, all with a unanimity of purpose leading to higher and higher oil prices. Whether the storm actually hits or not, one thing is sure. The mere specter of the event will have the oil industry and the oil trading community cheering, "Go Big Dean, Go".


Why ‘Peak Oil’ May Soon Pique Your Interest

Do a Google search of the Web on “global warming” and it calls up more than 80 million references. Search for “peak oil” and the number exceeds 10 million.

In two years or so, world concern over crude oils supplies should be so great that a Google search on that subject probably will top that of global warming, predicts Matthew Simmons, chairman of Houston-based Simmons & Company International, an investment banking firm for the energy industry.


The India nuclear deal: The top rule-maker bends the rules

The White House reached a deal late last month to provide India with U.S. civil nuclear cooperation, reversing a ban on such cooperation that had been in place since 1978.

After India's first nuclear test in 1974, the United States decided to halt nuclear exports to countries that have not signed the Nuclear Nonproliferation Treaty, and persuaded the rest of the world's nuclear suppliers to make this a global rule in 1992.

Jim Jubak on Peak Oil

Peak Oil Linkfest - 08/07/07

Why 'peak oil' may soon pique your interest

Do a Google search of the Web on "global warming" and it calls up more than 80 million references. Search for "peak oil" and the number exceeds 10 million.

In two years or so, world concern over crude oils supplies should be so great that a Google search on that subject probably will top that of global warming, predicts Matthew Simmons, chairman of Houston-based Simmons & Company International, an investment banking firm for the energy industry.


Towns prepare for 'peak oil' point

Globally we are addicted to oil. Not only are we addicted, but we use it like there was no tomorrow.

We use it for heating and lighting, it powers 95% of our transportation, we use oil to take low value foodstuffs from one side of the world to the other, we use it for plastics, manufacturing, clothing, medicine. Oil is everywhere, but it's not infinite.


The World Energy Modeling Project

The following is a guest post about the need for global energy systems modeling, by ASPO-USA co-founder Dick Lawrence. Mr. Lawrence has a degree in Physics from Rensselaer Polytechnic Institute. After a career at Digital Equipment and Intel he is focusing on the world energy model and starting a solar hot-water business in Massachusetts. In 1986 he read "Beyond Oil" (the original) which was his introduction to resource depletion, Hubbert's peak, and the power of computers to model the behavior of complex systems. In May 2004 he proposed a project to model global energy flow at the ASPO meeting in Berlin.


Kelpie Wilson: Paying the Peak Oil Power Bill

Sometime this week, the House will vote on a new "energy independence" bill designed by the Democrats. Even though Congress just passed an omnibus energy bill in 2005, there is growing agreement on both sides of the aisle that the need for "energy security" is growing and more must be done to ensure it.


Qatar says Opec can do nothing about oil prices

The Organisation of Petroleum Exporting Countries (Opec) can do nothing about the high price of oil as there is no shortage of crude in the market, Qatar's oil minister said on Thursday.

"We can't do anything because this price is not related to a shortage of supply," Qatar's Oil Minister Abdullah Al Attiyah said. "Inventories in industrialised countries are at high levels. That proves there is no shortage of supply at all."


Peak Oil Passnotes: To Sir With love

The U.K. has a problem: Its local oil and gas have peaked. There is no argument, it is not heresy in the local industry and you can say it without being dragged out of your office and exposed as a communist. U.K. North Sea production peaked some years back at about 3 million barrels per day and continues to decline at around 1.8 million barrels per day at the moment. The decline rate is around 7% a year.

The same thing has happened in the United States. Oil production peaked at the start of the 1970s and, despite the huge concentration of capital and wells, continues to decline. These are both basic facts.


The End Of Cheap Food

It looks like the era of cheap food is over. The price of maize has doubled in a year, and wheat futures are at their highest in a decade. The food price index in India has risen 11%, and in Mexico in January there were riots after the price of corn flour went up fourfold. The floods in England and India have devastated crops. In nearly every country food prices are going up, and they are probably not going to come down again.

Peak Oil Linkfest - 07/30/07

Malthusian misery's comeback

The great demographer and economist Thomas Malthus was 23 years old the last time a British summer was this rain-soaked, which was in 1789. The consequences of excessive rainfall in the late 18th century were predictable. Crops would fail, the harvest would be dismal, food prices would rise and some people would starve. It was no coincidence that the French Revolution broke out the same year.


When life hands you vegetable oil, make biodiesel fuel

A teacher at Bloom High School has been awarded a $10,000 grant to fund a student project that will create a waste vegetable oil recycling program.

Barry Latham’s student project is titled "Free Energy for Me." A chemistry and physics teacher, he received an A+ for Energy grant from BP America.


Depleting water level a big problem

An international study group has warned that the water shortages in India and other parts of the world will be a serious problem in days to come. “Scores of countries are overpumping aquifers as they struggle to satisfy their growing water needs, including each of the big three grain producers —China, India, and the US. “More than half the world’s people live in countries where water tables are falling,” Lester Brown of the Earth Policy Institute has said.


Chomsky: There Will Be a Cold War Between Iran and the U.S.

In the energy-rich Middle East, only two countries have failed to subordinate themselves to Washington's basic demands: Iran and Syria. Accordingly both are enemies, Iran by far the more important.

As was the norm during the Cold War, resort to violence is regularly justified as a reaction to the malign influence of the main enemy, often on the flimsiest of pretexts. Unsurprisingly, as Bush send s more troops to Iraq, tales surface of Iranian interference in the internal affairs of Iraq -- a country otherwise free from any foreign interference, on the tacit assumption that Washington rules the world.


Peak oil - expensive food

At one time the need for more food resulted in the worldwide increase in arable land via the clearing of forests and irrigation of arid land. The land available has peaked and is decreasing because of salination of irrigated soils, diversion to bio-fuels and the growth of cities. Cheap fossil fuels allowed pumping of water for irrigation, and cheap food transport encouraged the growth of cities away from the centres of food production.


Forget Big Oil - politicians bowing to Big Ethanol

When the Senate passed an ethanol-friendly energy bill last month, there was no particular scientific or economic reason for setting 36 billion gallons - six times what is used today - as America's renewable fuels requirement within 15 years.

But there was a political reason for that number: Senators wanted to one-up President George W. Bush, who had called for 35 billion gallons in his State of the Union message.


The choice is ours: Big Oil or Chavez?

In the coming century, the world will transition from cars that run on liquid fuels to cars that run on something else, perhaps electricity or hydrogen. Until then, we have a choice. Either support the "Big Oil" companies that are SEC and IRS regulated, traded on the major stock exchanges, contribute to our economy and national security, and whose employees are our neighbors, or butt into energy myths and stand by idly (gleefully?) while Hugo Chavez ejects "Big Oil" from Venezuela.

Peak Oil Linkfest -07/24/07

Cold sore - Russia's relations with the West

In early 2000, the UK embassy in Moscow took a bit of a gamble. They persuaded Tony Blair to make one of his first major foreign policy initiatives a meeting with the new face in the Kremlin and heir apparent, Prime Minister Vladimir Putin. At the time it was a bit of a shocker – a popular, powerful, top-level, democratically elected leader meeting with an unelected, unknown, KGB spy who was failing to manage a bankrupt country over-run by dodgy oligarchs.


Migrating to New Energy Paradigms Part 2 - The Economic Importance of Crude Oil

Peak Oil is defined as the point at which 50% of the world's oil reserves have been consumed, and 50% remain. We all understand that oil is important to the world economy, but just how important is it?

In October 2004 I attempted to answer this question on behalf of a client as part of that client's long range strategic planning process. The amount of work involved was fairly significant so I have chosen to rely on my findings of that time for the purposes of this article. There are two other reasons:


$100-a-barrel oil may be only a few months away

The $100-a-barrel oil that Goldman Sachs Group said would prevail by 2009 may be only a few months away.

Jeffrey Currie, a London-based commodity analyst at the largest brokerage firm, said that $95 crude was quite likely this year unless OPEC unexpectedly increased production and that declining inventories were raising the chances for $100 oil.


The future is solar; politics is ethanol

This seems like a good place to tout Robert Rapier's excellent recent post: "The future is solar." In it, he makes the very simple point that photosynthesis -- the means by which corn, rapeseed, switchgrass, etc. make energy from sunlight -- is not particularly efficient: "when an acre of rapeseed/canola is planted, we get about 0.06% conversion of the sun's energy into oil."


Falling dollar puts pressure on Opec

The falling US dollar is lowering the Organisation of the Petroleum Exporting Countries’ purchasing power by up to a third, making the powerful oil cartel more reluctant to increase production and cut prices.

Although oil is trading near last August’s record $78.65 a barrel, Opec calculations show that, when adjusted for the weaker dollar and inflation, an average of the 12 Opec members’ crude oil prices has fallen in the past year.


British teach less Churchill, more global warming

Once upon a time, the British curriculum was straightforward. There was math, English, science. You learned about Winston Churchill, how to locate Greece, and how to say "My name is John" in French.

But starting next year British teenagers will face an exotic range of new disciplines designed to equip them with more practical skills. Healthy cooking, personal finances, and global warming are in. Charles Dickens, Jane Austen, and the Battle of the Nile may be nudged out.


Nigeria: Tackling the Niger Delta Crisis

From being prided as the region that lays the golden egg for the nation, the Niger Delta gradually slipped into the abyss of underdevelopment and environmental pollution. Today, it has metamorphosed into a zone characterised by militancy, pipeline vandalisation and hostage-taking for ransom. This region that accounts for only about 7.5% of Nigeria's landmass has become a top priority of the President Umaru Yar'Adua's administration, having been similarly prioritised by the regime of former President Olusegun Obasanjo.


The Future of Thought in the Oil and Gas Industry

When I joined Shell Development in January 1983, I was among a group of 11 Ph.D.s, engineers and physicists hired from the best U.S. universities. I entered a venerable research organization shaped by none other than M. King Hubbert, who led Shell Development for 20 years. Over its history, this organization gave the world Hubbert’s peaks and the notion of resource limitations, W. R. Purcell (capillarity), G. E. Archie (modern petrophysics), M. A. Biot (modern geophysics), J. Handin (rock physics), and many others.

Peak Oil Linkfest - 07/22/07

After peak oil: Will America survive?

As public awareness about peak oil continues to grow, and even the big oil companies like Exxon Mobil Corp. are now starting to admit that the future supply of oil looks troublesome (see this Boston Globe article), there's an increasing focus on renewable energy solutions. But most members of the public still don't understand energy very well, and they generally have no idea whether alternative energy sources like solar, wind or CSP (see below) can replace oil. Many people are concerned about a potential collapse of modern society due to the end of cheap oil. So to help answer some of these questions, I've put together a set of uncensored, science-based answers about oil, renewable energy and the future of modern civilization. This is offered in a Q&A format.


PM to discuss Iran crisis at Bush summit

GORDON BROWN is to discuss the looming crisis over Iran with President George W Bush on his first official visit to America as prime minister. The summit may take place next weekend at Camp David, the presidential retreat, although the dates and location are still being finalised.

It comes as one Washington source said the mood in the Bush administration had hardened in favour of military strikes to prevent Iran developing a bomb. “There are increasing signs that Bush will not want to leave a nuclear-armed Iran as his legacy,” the source said.


BNP plans to seek safety in Croatian idyll

When the fossil fuels run out, leaders of Britain's far right hope to survive on a farm in the Balkans.

A few miles from the historic southern Croatian town of Knin lie 1,100 hectares of farmland and a couple of abandoned buildings. A tributary from the river Krka runs through the lush countryside nestled close to the sun-drenched Adriatic coast.


Lots of energy, shortage of policy

The U.S. National Petroleum Council's new report on global energy markets, believed to be one of the most extensive studies of its kind, received mixed reviews this week from greens and others whose policy ideas depend on an ever-present looming catastrophe. Especially put out by the 470-page report, titled Facing the Hard Truths About Energy, were the peak-oil theorists, who believe disaster is imminent as the world supply of conventional oil is set to peak, triggering a catastrophic decline.


OPEC oil prices hit record high

The daily average oil price of the Organization of Petroleum Exporting Countries (OPEC) hit a new record of 72.83 U.S. dollars per barrel on Monday, up 0.34 dollars from the previous trading day and 0.16 dollars higher than the previous record set last August.

The OPEC's weekly average prices also reached a record high of 71.86 dollars per barrel, 0.14 dollars higher than the previous record set in the second week of August 2006, the cartel's secretariat said on Tuesday.

Peak Oil Linkfest - 07/16/07

IEA calls for Opec to increase production

World oil demand growth will accelerate in 2008 to 2.5 per cent from this year’s 1.8 per cent despite high oil prices, the industrialised countries’ energy watchdog said on Friday.

The International Energy Agency’s forecast comes as Brent oil rose to a fresh 11-month high of $77.60 a barrel , about $1 below the all-time high set last August.


World not running out of oil, says report

Proponents of “peak oil”, the theory that global crude oil production is nearing its zenith, are unimpressed with a US oil industry group’s findings that the world has plenty of oil.

This week the US National Petroleum Council, a board of high-level US oil industry executives, releases its study titled, Facing the Hard Truths about Energy, conducted at the behest of US Energy Secretary Sam Bodman.


On the precipice: Energy security and economic stability on the edge

I am a Major in the United States Army. When looking at this report for the first time, one may legitimately ask why an Army officer is writing about energy issues.

The genesis for this project began many months ago when I was conducting research for a project related to the development of the future force in the US Army. I believed it was important to include an effective assessment of what the world might look like in the year the force was projected to complete its initial fielding (2030).


New Oil Reports Add Confusion To 'Peak Oil' Theory

Proponents of "peak oil" -- the theory that global crude oil production has hit its zenith and is headed for a steep decline -- are upset with a U.S. oil industry group's findings that the world has plenty of oil. Next week the U.S. National Petroleum Council -- a board of high-level U.S. oil industry executives -- releases its study titled "Facing the Hard Truths about Energy," conducted at the behest of Energy Secretary Sam Bodman. According to the report's executive summary obtained by Reuters, the world is not running out of oil but there are "accumulating risks" to securing supply through 2030. In a draft letter to Bodman outlining its findings, the National Petroleum Council says, "The world is not running out of energy resources, but there are accumulating risks to continuing expansion of oil and natural gas production from the conventional sources relied upon historically."


In West China, saving the go-go juice

I heard about a village two hours from Chongqing City with old city walls surrounding smoke stained wooden beamed homes, cobble stone streets and stone carvings chiseled into cliff faces 400 years ago. Along the way to Lai Tan, I wanted to gaze out of bus windows and simply compare the differences between Chinese and western methods of fossil fuel use and human power, but first I had to get to the bus station.


Energy's Manpower Peak? - Why the biggest problem might not be oil.

For headhunters like Tom Zay, business couldn’t be better. “I have never seen demand like this,” says Zay, a managing director in the Houston office of Boyden, an executive worldwide search firm. “We’ve had cycles in the past. But this is different.”

Indeed it is. While Zay looks for executives and top-level managers, the entire energy industry – from welders, tank builders, and roughnecks to petroleum engineers, nuclear engineers, and technicians – is strapped for talent. And the problems are likely to get substantially worse before they get better. Nor is the labor shortage limited to the U.S. and the hydrocarbon sector. Rather, it is worldwide, and being felt in industries ranging from coal mining to nuclear power. The reasons for the labor crunch are many: an aging workforce, lagging student interest in engineering, a lack of interest in blue-collar jobs like welding, and perhaps most important, the strong commodity prices that have led to a boom in energy projects of all types.


Potential Energy Crunch May Bring Other Fuels to Fore

World oil and gas supplies from conventional sources are unlikely to keep up with rising global demand over the next 25 years, the U.S. petroleum industry says in a draft report of a study commissioned by the government.

In the draft report, oil-industry leaders acknowledge the world will need to develop all the supplemental sources of energy it can -- ranging from biofuels to nuclear power to oil extracted by unconventional means from the oil sands of Canada -- to meet soaring demand. The surge in demand is expected to arise from rapid economic growth in such fast-developing countries as China and India, as well as mounting consumption in the U.S., the world's biggest energy market.


Energy: the new cold war

Since the close of the cold war, we have been growing used to threats such as terrorism where the enemy has no state or territory. But soon we will have to get used to new strategic challenges, such as energy security, where fossil fuels will be used as weapons to achieve political ends. Energy security will be synonymous with national security and economic security.


Oil 'could hit $95 a barrel this year'

The key Middle Eastern members of oil cartel OPEC were tonight coming under pressure for an immediate increase in production after a warning from Goldman Sachs that prices could hit a peak of $95 a barrel by the end of the year.

With a new bout of speculative activity today driving Brent crude to within a few cents of the record $78.65 reached last summer, Goldman said shortages of supply were behind the steady rise in oil prices.


Disaster at the end of the cheap energy era

While warning signs are appearing of associated crises in the rapidly rising Third World populations and the rising prices for diminishing world resources of food and raw materials, the International Energy Authority has belatedly accepted the reality of peak oil and the fearful impact this will have on the future of the world.

The devastating nature of this issue is that humanity has used up half of the world's oil reserves, with the remaining half overwhelmingly lower in quality and in less accessible fields.


Are these the last days of the Oil Age?

Oil ruled the 20th century; the shortage of oil will rule the 21st. There is now no doubt about the rising trend in oil prices. In 2003 a barrel of Brent crude sold for $29; in 2004 it rose to $38; in 2005 it rose to $54.50; in 2006 it rose to $65. Last Friday the price closed at $77.50. Some dealers expect it to test the $80 level quite shortly.


Crude Oil Rises to 11-Month High as North Sea Production Drops

Crude oil rose to an 11-month high in New York and London after a pipeline shutdown and maintenance work reduced North Sea Brent oil production.

Chevron Corp. and ConocoPhillips said they lost output from North Sea fields that produce oil and gas after BP Plc closed the pipeline. BG Group Plc said its Armada oil field in the North Sea has been shut for maintenance since June. The International Energy Agency said in a report today that global oil demand will rise 2.5 percent next year.


A new dawn for nuclear power

Despite its environmentally unfriendly image, nuclear power is firmly back on the world's energy agenda thanks to the need to cut carbon-dioxide emissions. Paul Norman, Andrew Worrall and Kevin Hesketh describe how the next generation of nuclear power stations will be cleaner and more efficient than ever


Peak Oil Passnotes: Peak Oil Zombie Attack

As we have made clear many times in this column we hold little truck with many of the whackos who inhabit the wondrous world of ‘Peak Oil’. Yes, despite the title of the column. No sooner do people start talking about energy supply crunches, plateauing production or acreage inflection then a host of bedraggled crazies rise forth from their graves to tell us a number of scary items.

Firstly, we are often told humanity is going to “die off.” What a great idea. It could almost be a book, or a series of books and a website. Oh wait. It is. Like an energy-related version of the film 28 Days Later. Every lazy person around the planet can argue how many people will be alive in 2050 or 2100 and no one can prove them wrong. Ker-ching!


"Peak oil" advocates blast U.S. industry study

Proponents of "peak oil" -- the theory that global crude oil production has hit its zenith and is headed for a steep decline -- are steamed with a U.S. oil industry group's findings that the world has plenty of oil.

Next week the U.S. National Petroleum Council -- a board of high-level U.S. oil industry executives -- releases its study titled "Facing the Hard Truths about Energy," conducted at the behest of Energy Secretary Sam Bodman.


Net Oil Exports and the "Iron Triangle"

As Matt Simmons pointed out several years ago, the critical problem with post-peak exporting regions is that we would have two exponential functions (declining production and generally increasing consumption) working against net exports. From the point of view of importers, it is quite likely that we are facing a crash in oil supplies. In my opinion, what I have described as the “Iron Triangle” is doing everything possible to keep this message from reaching consumers.


Iran Asks Japan to Pay Yen for Oil, Start Immediately

Iran asked Japanese refiners to switch to the yen to pay for all crude oil purchases, after Iran's central bank said it is reducing holdings of the U.S. dollar.

Iran wants yen-based transactions ``for any/all of your forthcoming Iranian crude oil liftings,'' according to a letter sent to Japanese refiners that was signed by Ali A. Arshi, general manager of crude oil marketing and exports in Tehran at the National Iranian Oil Co. The request is for all shipments ``effective immediately,'' according to the letter, dated July 10 and obtained by Bloomberg News.

Peak oil Linkfest - 07/13/07

President: Iran not to halt uranium enrichment work

Iran's President Mahmoud Ahmadinejad says the West should not expect his country to suspend uranium enrichment. He made the comment as a delegation from the UN nuclear watchdog arrives in Tehran.


Reader Mail: Peak Oil, Global Economy Shifts Away From US Towards Asia

Some questions about Peak Oil from a reader. And by the way, while we don’t always have space to publish your questions and comments in the e-mail edition of the Daily Reckoning, there is plenty of room in the comments section under any post on the website. You can respond directly to other readers, too. Here’s a question:


Play peak oil before you live it

On April 30, 2007, an oil crisis shook the world. Supply chains were interrupted, and in the ensuing weeks the price of gas pushed higher and higher, peaking around $7 per gallon. The American economy sputtered to a halt as shortages spread -- Detroit's car factories cited lack of demand and shut down for the duration, trucking fleets scrambled for fuel to move their cargo, supermarkets jacked up their prices, and commuters bitched and moaned and grudgingly changed their lifestyles. Looting broke out, along with the occasional riot.


IEA boss denies and confirms peak oil in same breath

It seems that the International Energy Agency, the intergovernmental energy watchdog, has been going in overdrive lately. First, we had the interview of its chief economist warning us that we were going toward a wall without Iraqi oil, then the recent publication of their yearly outlook report predicting shortages within 5 years, and now we have another disquieting interview in Le Monde, the big French daily, with Claude Mandil, the head of the Agency, who pulls no punches, despite an apparent denial of "peak oil". Follow me below the fold for a translation.


OPEC says no plans for increased production; crude prices continue upward

Light, sweet crude for August delivery was up 99 cents a barrel to trade at $73.55 midday on the Nymex. London Brent crude made its way above $76 a barrel before settling at $75.44 a barrel – up $1.36.


Why does Kuwait keep its oil reserves secret?

Kuwait's Acting Oil Minister Mohammad Al-Olaim has reaffirmed the oil reserves at 100 billion barrels under the pressure from the members of parliament.

Some lawmakers had threatened not to pass this year's budget, which is with a projected deficit of around 10.3 billion U.S. dollars, if the oil sector didn't tell them the truth about the country's oil reserves.


Global Warming May Spawn Floods of Beaches and Cities

Global warming may spawn more flooding at northeastern U.S. beaches and cities and disrupt the ski industry unless heat-trapping emissions are curbed, scientists said in a report.


'Swindle' director hits back at critics

THE director of a controversial documentary about global warming airing on ABC television tonight says he's been vilified for challenging popular theory.

Briton Martin Durkin directed The Great Global Warming Swindle, which seeks to debunk the idea that climate change is being caused by human activity.


The Peak Oil Crisis: A Tale of Two Reports

In the last few days, two important reports on the prospects for world oil production were “released.” While these reports reach diametrically opposite conclusions, each of them, in its own way, is likely to make a contribution to the debate over just when the economic troubles occasioned by the peaking of world oil production will occur.


Platts Survey: OPEC Oil Output Up Slightly in June, Well Above Target

The 10 members of the Organization of Petroleum Exporting Countries (OPEC) bound by the group's crude oil output agreements boosted production by 40,000 barrels per day (b/d) to 26.6 million b/d in June, from a revised May level of 26.56 million b/d, a Platts survey showed July 11. This is well above the 25.8 million b/d production target set in February by the so-called OPEC-10.


Net Oil Exports and the "Iron Triangle"

As Matt Simmons pointed out several years ago, the critical problem with post-peak exporting regions is that we would have two exponential functions (declining production and generally increasing consumption) working against net exports. From the point of view of importers, it is quite likely that we are facing a crash in oil supplies. In my opinion, what I have described as the “Iron Triangle” is doing everything possible to keep this message from reaching consumers.


U.K. Parliament Members Form `Peak Oil' Study Group

The U.K. parliament formed a group to study peak oil, the theory that world oil production is approaching its zenith, as British lawmakers face up to the country's future as an energy importer.

The All-Party Parliamentary Group on Peak Oil and Gas, which held its first meeting June 26, comprises 32 members of the House of Commons, or lower chamber, and seven from the House of Lords, or upper chamber.


Ethanol Boondoggle: Your Taxes at Work

In recent years, the price of gasoline has soared as the supply of crude oil has risen in response to unprecedented global demand. But never fear, Uncle Sam is here! Citing the need to decrease our country’s dependence on foreign and potentially unreliable sources of energy, Congress, encouraged by President Bush, has passed laws mandating that ever-greater quantities of corn-based ethanol (CBE) be produced, and subsidizing this production with tens of billions of dollars. Could it be that our leaders are finally demonstrating bipartisan unity for the good of the country? Well, “unity,” yes, “good,” no.


The Coming Conflict in the Arctic

Russian President Vladimir Putin and U.S. President George W. Bush spent most of their time at the “lobster summit” at Kennebunkport, Maine, discussing how to prevent the growing tensions between their two countries from getting out of hand.

The media and international affairs experts have been portraying missile defense in Europe and the final status of Kosovo as the two most contentious issues between Russia and the United States, with mutual recriminations over “democracy standards” providing the background for the much anticipated onset of a new Cold War. But while this may well be true for today, the stage has been quietly set for a much more serious confrontation in the non-too-distant future between Russia and the United States – along with Canada, Norway and Denmark.


Climate Expert Questions Gore's Global Warming Campaign

This past weekend concerts took place around the world to focus attention on the problem of global warming, which former U.S. Vice President Al Gore says is the greatest single threat facing humankind today. Most of the world's scientists agree that it is a problem and that it is largely caused by human use of fossil fuels, which produce so-called greenhouse gases that trap the Earth's heat. Al Gore and scientists who wrote the United Nations report on climate change say the debate is over and the time has come to act. But some prominent climate scientists are objecting to that, claiming that the debate has yet to even begin. VOA's Greg Flakus recently spoke to one of them and filed this report from Fort Collins, Colorado.


The biofuel myths

The term "biofuels" suggests renewable abundance: clean, green, sustainable assurance about technology and progress. This pure image allows industry, politicians, the World Bank, the United Nations and even the International Panel on Climate Change to present fuels made from corn, sugarcane, soy and other crops as the next step in a smooth transition from peak oil to a yet-to-be-defined renewable fuel economy.


Kuwait and IEA Show Declining Oil Production Future

Crude oil prices could reach levels of US$100 per barrel or more if some of the latest production factors in the news become reality.

Not only has the Paris-based International Energy Agency (IEA), the energy watchdog of the Organisation for Economic Co-operation and Development (OECD) countries, warned in its latest medium-term oil market report that a market crunch is looming over around 2012, but some OPEC producers are breaking even more negative news. After a short analysis hype in the beginning of 2006, analysts have been forgetting to cover OPEC countries currently battling reserve issues.


Peak Oil Now?

Demand for oil is continuing to grow, and threatens to burn up excess oil capacity by 2012, according to a new report released today by the International Energy Agency.

Excess capacity in OPEC is forecast to drop by 2 million gallons per day by 2009, and to virtually zero out by 2012. It won’t take until 2012 — or 2009 for that matter — for the cost of that tight supply to ripple through the economy straight down to the American homeowner and car driver.

Peak Oil Linkfest - 07/08/07

Around the Markets: Biofuel demand gives lift to commodities

Sugar, corn, wheat and cotton may be among the best commodity investments in the next one to three years, driven by biofuel demand and rising incomes in China and India, according to UBS, the world's largest money manager.

"Investors can expect to see a 6 to 10 percent plus return per year on those investments," Stuart Fox, UBS's head of commodities in Asia Pacific, said by phone from Hong Kong. His energy and commodities traders and sales team in Asia has more than tripled to 16 people in the past 12 months.


Green facade: Why the state's eco-friendly cars aren't doing the job

During the past two years, Gov. Arnold Schwarzenegger's administration sunk more than $17 million into a state fleet of cars and trucks designed to be environmentally friendly.

So far, the 1,138 "flex-fuel" vehicles have traveled a collective 10 million miles and burned more than 413,202 gallons of gas.


Real Alternative Energy Sources

If Congress is going to subsidize energy to free us from dependence on foreign oil, it should — at the very least — spend our hard-earned taxpayer dollars on something that will work.

The unfortunate truth is that neither ethanol nor any other so-called renewable alternative energy now being discussed on Capitol Hill is likely to make any significant contribution to our energy needs.


Marchetti's Curves

This is a brief account of the Energy Susbstitution Model developed by Cesare Marchetti in the 1970s at IIASA. Using data from the latest BP Statistical Review the evolution of the energy market is compared with the model to understand why the Hubbert Peak of fossils fuels represents a problem today.


World 'building up risks over energy supplies'

The world is not running out of crude oil and natural gas but there are 'accumulating risks' to securing global supplies through 2030, a high-level board of US oil company executives found in a report.Those risks include "political hurdles, infrastructure requirements and availability of trained workforce," according to the study by the US National Petroleum Council, conducted at the behest of US Energy Secretary Sam Bodman.

The NPC, whose members include executives of big oil companies like ExxonMobil and Chevron, will present the study at its July 18 meeting.


Oil hits 10-month high near $75 on Nigeria, demand

Oil surged over 2 percent to nearly $75 a barrel on Thursday on strong demand and as fresh violence in Nigeria spurred supply concerns.

London crude rebounded after slipping from earlier highs on U.S. government data that showed crude supplies rising and refiners ramping up gasoline output to meet summer holiday driving demand.


Is Fear About Climate Change Causing a Nuclear Renaissance?

Some prominent environmentalists are urging that we reconsider nuclear power. But they have been met with resistance from many who believe nuclear power never will be a solution to global warming.

Sitting in the belly of the beast -- Dominion's 2,000-megawatt Millstone nuclear power plant in Waterford, Connecticut -- the company's chief nuclear officer, Dave Christian, seems an unlikely environmentalist. But he says concern about climate change is what got him involved in the peaceful pursuit of the atom in the first place.


IAEA: Iran Slowing Expansion of Nuclear Enrichment Capabilities

The head of the International Atomic Energy Agency says Iran has slowed the expansion of its nuclear enrichment capabilities.

In Vienna Monday, Mohamed ElBaradei said IAEA inspectors have seen a slowing in the installation of centrifuges that enrich uranium at Iran's Natanz nuclear facility.


Opec has little power to ease oil price – Algeria

Algeria’s Energy and Mines Minister Chakib Khelil said yesterday there was “not much” Opec could do to bring down high oil prices as global crude stocks were already sufficient.

“There is plenty of stocks. It’s a problem with capacity and refining,” Khelil said ahead of a gas pipeline conference in Brussels. “Even if it (Opec) increases production, it’s just going to increase stocks and not have any effect because prices are drawn by petroleum product prices.”


World facing oil ‘supply crunch’ as demand soars, agency warns

The world faces an energy squeeze as soaring demand for fuel exceeds the rate of growth in the supply of crude oil, the West’s leading energy forecaster has predicted.

In a gloomy appraisal of the global oil balance, the International Energy Agency yesterday predicted a world of increasing market tightness beyond 2010. The world faces a “supply crunch” by 2012, according to the agency’s Medium-Term Oil Market Report, with weak increases in oil output from nonOpec countries colliding with strong demand and diminished spare capacity within the cartel of oil producers.


Exploding a fair few wordy myths

AFTER recent comments from Defence Minister Brendan Nelson, debate is raging over whether America and Australia went to war in Iraq because of oil.

This is absurd. Nobody was more surprised to discover that Iraq had oil than the Allies. Goodness, with all that fuel around, it was just as well that those weapons of mass destruction were only prevented from exploding by the fact that they didn't exist. Otherwise, the whole country could have gone up in flames. Oh, wait a minute … Anyway, here are some ideas that should probably be blown up.


Iran's oil output to fall without investment - report

Iran's oil production capacity will fall by five percent a year without new investment, a senior oil official was quoted on Sunday as saying by the Iran's student news agency ISNA.

Iranian officials have previously put production capacity at a little more than 4 million barrels per day (bpd), with actual output -- limited to a quota set by the oil cartel OPEC -- running at a little below 4 million bpd.


Corn ethanol could be a dead end

As the nation fights to lower its dependence on foreign oil and Colorado works toward a new energy economy, the buzz word in energy circles is “ethanol,” and using it to power cars, trucks and electricity has become a hot topic.

But as the conversation continues, ethanol experts and politicians are beginning to agree that corn-based ethanol may not be the magic energy solution many have come to see it as.


Can I diet my way to a lighter eco footprint?

Lose weight and save the planet. It has all the hallmarks of a zeitgeist diet book and perhaps a TV series in which I will travel around putting punters on scales, measuring out their porridge for the day, and perhaps changing their light bulbs. But there is some validity to the idea that you can simultaneously shrink your waistline and your carbon footprint.

An extra 100lb of weight carried in your car, for example, reduces fuel economy by around 2 per cent. Even Richard Branson recently signed up to losing a stone before he takes an inaugural flight on one of the superlight carbon-fibre Boeing jets he has bought in order to save an extra 36lb of CO2. Given that his fleet allegedly produces 7.4m tonnes of CO2 a year, that's not a hugely rewarding diet


Will the coming oil crisis be the end of suburbia?

Three years ago, when I started to teach Introduction to Sociology for Lamar Community College, my brother sent me the DVD, “The End of Suburbia: Oil Depletion and the Collapse of the American Dream,” concerning the “coming oil crisis."

I showed it to my class to help the students better understand “social change” and what would happen to society during such a crisis. They hadn’t even heard that we were going to face such a crisis. It’s no surprise, most Americans hadn’t heard of it either; that was three years ago.


Peak Oil Passnotes: $80 Oil Beckons

The price of a barrel Brent crude is working its way back up to its records of $78.64 set last August 7. A steady and sure combination of factors has pushed it over $75 per barrel.

But when it pushes up against levels of $78 per barrel, which way is it going to go then?


Academic challenges global warming theory

An Australian academic has spoken out against the popular view that global warming is caused by greenhouse gas emissions. He believes that global warming and climate change are caused by cycles in the sun's electro-magnetic radiation. He says scientists are taking a narrow view and politicians are making policy with the wrong information.

Emeritus Professor Lance Endersbee AO is a former Dean of Engineering and Pro-Vice Chancellor of Monash University. He told Tom Harwood, ABC Western Queensland's Morning Program producer that the world has been warming naturally due to increased magnetic radiation from the sun.


Ethanol, Corn, Milk, Prices Increase

It appears that oil and gasoline aren't the only things that are going up in price these days. Milk, everyones favorite beverage, has gone up in price once again.From $3.80 to almost $5.00 a gallon. But milk however, isn't the only thing that will be on the rise. Other dairy products such as butter, cheese, yogurt, and ice cream will too.


Sugar, Grains, Cotton May Be Best Commodity Buys, UBS Forecasts

Sugar, corn, wheat and cotton may be among the best commodity investments in the next one to three years driven by biofuel demand and rising incomes in China and India, according to UBS AG, the world's largest money manager.

``Investors can expect to see a 6 to 10 percent plus return per year on those investments,'' Stuart Fox, UBS's head of commodities in Asia Pacific, said by phone from Hong Kong. His energy and commodities traders and sales team in Asia has more than tripled to 16 people in the past 12 months.


North Sea is running too dry to meet target

The energy industry warned yesterday that government targets of keeping Britain's oil and gas production at 3m barrels a day by 2010 look like being missed. North Sea competitiveness is falling and financial backers are losing confidence in the wake of tax increases introduced 18 months ago.

Civil servants have been working with oil companies to find ways to boost output offshore, but the 2007 Economic Report issued by the industry organisation Oil & Gas UK says the goal looks like being missed after five years of rising hopes.