Oil Prices and the Media

[TimeTraveler]

Yes you would' date=' and the SUV and small truck popularity statistics suggest exactly the opposite. Which is proof positive that gas is undervalued in this economy.

 

Here's one way to look at our options: We basically have a choice. We can offer incentives, or we can tax gas at a higher level.

 

The former option boosts the economy by pumping taxpayer money directly back into it.

 

The latter option takes more out of your pocket and causes massive inflation, harming the economy.

 

Which would you all prefer?[/quote']

 

What do I win if I get the answer right! hehe.

 

Vehicles are a start, but they only account for a portion of out oil/gas usage.

[reverse]

I think of oil as:

sunlight that has been put away in bank account for us ages ago.

 

if you follow my logic.

 

I really like sunlight as a form of energy.

 

who can bioengineer a pine tree with an electric outlet on it .

 

but seriously, that sort of bio-machine would be a fantastic solution.

we should start to change our view on the way we incorporate trees into our energy requirements.

they are our natural link to the energy of the sun.

[Pangloss]

Vehicles are a start, but they only account for a portion of out oil/gas usage.

 

Quite right. I've been looking for a statistic on that, by the way (what percentage of total oil consumption is from vehicles), if you happen to know one. (I make it sound like I'm writing a paper or something, but I'm just curious.)

 

Incidentally, only about 40% of total energy usage comes from oil. Not a very politically correct statistic, is it? Not that coal and gas are very rational alternatives, I suppose, but it's a fun stat to throw out at parties, especially if you don't want to be invited back. (chuckle)

[syntax252]

I remember in 1973 when the oil embargo was imposed, that all of the so-called scientific community made us a solemn promise.

 

That promise was that by the year 2000, all the oil in the world would have been pumped and burned up. There would be no more.

 

At the time I thought that was horseshit. I was right. Now I think that all this "we are in real trouble here" stuff is horseshit.

 

I ageree that there is a finite amount of oil in the world. I do not agree that switching to some other energy source is going to be any great hurdle to jump. We will look back upon it as one of the best things to ever happen to us.

[Ophiolite]

I remember in 1973 when the oil embargo was imposed' date=' that all of the so-called scientific community made us a solemn promise.

[/quote']You sure as heck were listening to a different part of the scientific community to anyone inside the oil industry. I suggest it was also well known, except perhaps in the popular press and TV, that the 1973 situation was entirely political.

That does not alter the fact that we are running out. Here is the critical point, taken from this article http://www.peopleandplanet.net/doc.php?id=1462 :

"The halfway point to production of all the Ultimate Recoverable Reserves is a crucial milestone. Strong historical evidence for many oil basins shows that oil production peaks and starts to decline when about half the recoverable resource has been consumed. This is a matter of oil reservoir physics rather than production technology or economics.

 

The idea was first proposed by the United States oil geologist M King Hubbert who predicted, in 1956, using two estimates of that country's Oil Ultimate, that United States oil production would peak in the early 1970s. Hubbert was widely ridiculed by the oil industry, but was proved right when United States oil production peaked and began to fall in 1971."

 

Fluctuations in demand and in reserve estimates make it difficult to accurately predict this for the planet, but assessments range from 2005 to 2025. We have time, but only if we act responsibly. Gasoline at $1 or $2 a gallon is not responsible. In the UK we pay around $1.50 a litre. The rest of Europe is similar. Arguably this is too low. To put it crudely you can get your wrist slapped now or have your hand chopped off in thirty years.

[syntax252]

You sure as heck were listening to a different part of the scientific community to anyone inside the oil industry. I suggest it was also well known' date=' except perhaps in the popular press and TV, that the 1973 situation was entirely political.

[/quote']

 

Actually, no. I agree that the supply is finite. I also agree that the reliance on crude oil for our primary source of energy will necessarily come to an end. Perhaps soon. But the definition of "soon" seems to vary from 5 years to 45 years.

 

As one who has witnessed some fairly significent changes in lifestyle in the US over the past 68 years, I have unshakable faith in the ability of the American people to meet the challenge.

 

Here is what is going to happen: As the supply of crude goes down and the price goes up, alternate sources of energy, that are not feasible today will become feasible. Wind power, solar power, hydro-electric, geothermal, tidal power stations, coal gasification, alcohol and many others will all come into play, their use depending on the location as much as anything else, but the focus will be on producing electricity by the use of these other methods and fuel sources. In addition, better fuel effeciency will continue to reduce the consumption, at least on a pr. capita basis.

 

The air will be cleaner, energy bills will be lower, or no higher than now and we will have added centuries to the length of time that humankind can live on this planet.

 

As I said earlier, we will look back on this depletion of crude oil as the best thing that ever happened to us.

[coquina]

When the oil embargo hitin '73' date=' I was driving a 1973 Pontiac Ventura with a 350 engin in it. It was good for 14 MPG on the hiway.

 

Now, I am driving a 2003 Monte Carlo with a 3800 CC engin in it that is good for 30 MPG on the hiway.

 

[/quote']

 

I was driving a 1966 Plymouth Satellite convertable with a 361 engine (that my dad gave me as a high school graduation gift.) It was lucky to get 7 mpg - 'course, I was young, and left a portion of my tires at every stoplight

[TimeTraveler]

I think alot of what happened in the 70's was misinterpretation. M King Hubbert who is accreditted for bring peak oil to light predicted that sometime in the 70's the USA would peak in oil. Many of his critics often said in the 70's, "see this guy is a loony toon, we have never produced as much oil as we did in 1970".

 

That is what peaking is, it is when you reach the maximum production. The year(s) you peak are when you will produce the most oil. After that you landslide downhill.

 

The USA did in fact peak in 1970, and what came in the years after that was recession. Eventually we became very dependant on foreign oil. And when that foreign oil peaks there is no easy fix, such as getting it from somewhere else.

 

The problem is here and is now or very soon. There is no propaganda behind it, Both sides of the fence, and all areas of the world are in agreeance, there is no dispute or debate as to if it is going to happen. The only dispute is when it is going to happen, and that dispute ranges from already started to 2012ish.

 

We will not run out for many many years, heck we may never run completly out. But we are at the point where we cannot produce as much as fast as we use, and we use alot, that will be devastating for many industries as prices skyrocket.

 

Excellent post btw Ophiolite! But I have not heard about the 2025 timeframe, what I have heard has put it much closer than that. Maybe those predicting 2025 were saying that before it was discovered many oil companies were inflating their reserves by up to 60% to raise their stock prices.

[TimeTraveler]

Quite right. I've been looking for a statistic on that' date=' by the way (what percentage of total oil consumption is from vehicles), if you happen to know one. (I make it sound like I'm writing a paper or something, but I'm just curious.)

 

Incidentally, only about 40% of total energy usage comes from oil. Not a very politically correct statistic, is it? Not that coal and gas are very rational alternatives, I suppose, but it's a fun stat to throw out at parties, especially if you don't want to be invited back. (chuckle)[/quote']

 

I don't know the percentage but I would like to. I am very curious myself. I will see if I can dig something up.

 

I did find this though and it is very informative, also it has links to many places to get information.

 

http://planetforlife.com/oilcrisis/oilsituation.html

[Pangloss]

I was driving a 1966 Plymouth Satellite convertable with a 361 engine

 

She came from Planet Coquina....?

 

(hehe)

[syntax252]

 

The USA did in fact peak in 1970' date=' and what came in the years after that was recession. Eventually we became very dependant on foreign oil. And when that foreign oil peaks there is no easy fix, such as getting it from somewhere else.

 

The problem is here and is now or very soon. There is no propaganda behind it, Both sides of the fence, and all areas of the world are in agreeance, there is no dispute or debate as to if it is going to happen. The only dispute is when it is going to happen, and that dispute ranges from already started to 2012ish.

 

We will not run out for many many years, heck we may never run completly out. But we are at the point where we cannot produce as much as fast as we use, and we use alot, that will be devastating for many industries as prices skyrocket.

 

Excellent post btw Ophiolite! But I have not heard about the 2025 timeframe, what I have heard has put it much closer than that. Maybe those predicting 2025 were saying that before it was discovered many oil companies were inflating their reserves by up to 60% to raise their stock prices.[/quote']

 

The recession in the 70s was no worse that many other recessions and was followed by economic prosperity that lasted about 8 years, followed by another recession followed by about 8 years of prosperity followed by another recession followed by our current recovery.

 

No one is making the claim that the supply of oil is infinite. But the prospect of global depression is a little silly when there are so many alternative sources of energy.

 

And incidently, changing over to those alternate sources will not hurt the economy, it will be a boon to the economy, creating jobs that were not in existance before. So the old future is really not so scary as we thought--right?

[coquina]

She came from Planet Coquina....?

 

(hehe)

 

"The Little Old Lady From Pasadena" could have been written about my mom - when I got my car' date=' she went to the local dealer and ordered herself a 1967 Dodge Coronet convertable - midnight blue, baby blue interior. It says 440 on the chrome, but there's a 318 under the hood. I still have it, it's been garage kept from the git-go - original top, original upholstery, original engine. The odometer crapped out at 100k, probably about half of what it's got on it now.

 

Back to the topic of the media and oil prices - I paid $1.79 a gallon last week when I filled up. I drive a chevy van, (because of the business) - it cost me $40 to fill it. (It was on fumes) I get 22 to 25 mpg on it. The fuel prices have been fluctuating wildly. This winter has been the coldest in many years, for this area anyway - dunno if that holds true for the whole nation. In any event - in addition to the demand for home heating oil, there's a higher demand for electricity too - thanks to all those heat pumps and baseboard heaters.

 

Oh - yeah, and it's spring break for the college kids. Has anyone else noted that immediately before any holiday that's associated with road trips the cost of gas skyrockets?

 

Ophiolite wrote:

 

"The idea was first proposed by the United States oil geologist M King Hubbert who predicted, in 1956, using two estimates of that country's Oil Ultimate, that United States oil production would peak in the early 1970s. Hubbert was widely ridiculed by the oil industry, but was proved right when United States oil production peaked and began to fall in 1971."

"

 

I thought that a significant part of the reason for the decline was the oil fields that were discovered in the southern Gulf of Mexico and the North Sea. I remember reading that improvements to offshore drilling techniques plentiful supply in the previously untapped fields made the US oil less economic to extract.

 

...Not that I take all I read for Gospel, you understand, and I don't even remember the source.... Ophie - how much impact did the oil discoveries in these areas impact world market price?

[syntax252]

 

I thought that a significant part of the reason for the decline was the oil fields that were discovered in the southern Gulf of Mexico and the North Sea. I remember reading that improvements to offshore drilling techniques plentiful supply in the previously untapped fields made the US oil less economic to extract.

 

...Not that I take all I read for Gospel' date=' you understand, and I don't even remember the source.... Ophie - how much impact did the oil discoveries in these areas impact world market price?[/quote']

 

I have always had the thought that it was just as profitable for the oil companies to buy oil and then sell it as it was to pump it and sell it and when one adds in the consequences of arguing with the greenies and the environmental fanatics in America, it was a lot less hassle.

 

Meanwhile, we still have what we have, so if the world runs out, we will have all that is left. Maybe we can trade it for a couple of dutch windmills.

[Tetrahedrite]

Coming from a geological background, I don't think that the estimates are quite as they seem. What I believe will happen is that the supply of crude oil will start to run low, forcing prices up. The higher prices will however make it economical to produce petroleum/gasoline from sources other than crude oil. For example there are huge shale oil resources in Australia and elsewhere in the world. These resources haven't been exploited in over a century in many places, and the recent high prices have caused energy companies in Australia to re-examine the viability of such resources.

 

We also have much more coal resources in the world than oil (I believe it is around 200 years of proven reserves). If the price goes up enough, it may become viable to produce petroleum/dieseline by the catalytic "cracking" of coal.

 

On top of this, a rise in the price will also make oil/coal resources which are not economical now viable in the future.

[TimeTraveler]

But the prospect of global depression is a little silly when there are so many alternative sources of energy.

 

I hope you're right, but when one considers how much we rely on oil, especially for agriculture, food distrubution, our trucking industry, our import/export systems, our public transport systems, our plastics, and all of our private uses, it is difficult to think we can adjust fast enough with the drop.

 

If you think about it demand goes up and supply goes down those two things are going to continue to get further away from each other and fast. As they do the problem will get more serious and mmore serious as time passes by, hopefully you are right and we can make the adjustments fast enough. As of right now it doesn't seem like we are making the proper moves to do this, if peak oil is here its time to get moving.

 

The dems and repubs are argueing about the energy plan, Bush wants to start getting supply from Alaska, the dems want to start breaking into our reserves to meet demand... both need to concede and do both and stop bickering, imo.

[reverse]

Say the oil did run out.

 

What would be the biggest effect?

 

Well, no air travel except balloons.

 

Distribution problems and famine in the US?

Maybe not, trains could be converted to steam.

I spose we could make hydrogen if we had to.

 

I dunno, what do you suppose the actual problem would be?

Things would just slow down perhaps.

[TimeTraveler]

Say the oil did run out.

 

What would be the biggest effect?

 

Well' date=' no air travel except balloons.

 

Distribution problems and famine in the US?

Maybe not, trains could be converted to steam.

I spose we could make hydrogen if we had to.

 

I dunno, what do you suppose the actual problem would be?

Things would just slow down perhaps.[/quote']

 

Well, oil won't "run out". It will just deplete as demand rises. What will happen depends on what we allow to happen. We are perfectly capable of steping back, re-evaluating our situation, and making fundamental changes. At this point it's not really happening, awareness still needs to be raised.

 

We need to begin "weening" ourselves from our oil addiction. We need to slow down mass consumption without hurting the economy, we need to start growing our foods closer to where they will be sold, we need to rid ourselves of super-super stores such as walmarts and go back to smaller privatized businesses. We need to align our priorities. We need to think about the future and mold the future instead of pretending someone else will do it, or it will all fix itself. The only way I see us beating this addiction is a collective effort, and we need to face the problem on all fronts.

 

Whats the best that can happen: We can seriously face the problem collectively on all fronts, and it will be a short little bumpy ride for a few years, then we are in the clear.

 

Whats the worse that can happen: We do not put forth the proper effort, cars become too expensive to drive, our agricultural system gets too expensive to maintain, the importing and shipping of foods is drastically impacted, food prices rise, jobs decrease, people begin to starve, crime rates skyrocket, our importing exporting systems fail, our country goes into depression with the rest of the civilized consuming countries, we begin fighting for the tablescraps that are left, many wars, not to mention terror attacks will primarily focus on oil reserves and pipelines to rattle us even more, basically chaos.

[syntax252]

I hope you're right' date=' but when one considers how much we rely on oil, especially for agriculture, food distrubution, our trucking industry, our import/export systems, our public transport systems, our plastics, and all of our private uses, it is difficult to think we can adjust fast enough with the drop.

 

[/quote']

 

Well, we have been through these things before.

 

At one time Whale oil was what lit all the lamps in America. The farm work was performed with the Horse. When the automobile was introduced, it was heralded as a boon in NY because it cut down on the amount of Horse manure in the streets, something that was a major pollution probelm in the early 1900s.

 

Times change, people adapt.

 

If you are looking for a reason to believe in adptation, it is simple--GREED. With every problem comes the potential to get rich by solving the problem. Wanna see hydrogen used to power cars? $5 a gallon gas will do that, and after the developement work has been done, it'll be cheaper than gas ever was--why? because by selling it cheaper, you can sell more of it and by selling more of it, you get richer.

 

Greed is what took mankind away from the mouth of a cold dark cave and put him into the 4 bedroom rancher. Greed has never let us down yet and it won't let us down this time either.

[Pangloss]

Here's the thing I don't understand about the notion that expensive gas will drive us to alternate fuels:

 

If that's true, then why hasn't Europe invented *warp* drive by now? I mean the price of gas is so high there, you'd think we'd have colonized half the galaxy by now.

 

Europeans aren't stupid -- they continue to forefront many areas of scientific discovery. So is it possible there's a flaw in the logic there?

[syntax252]

Here's the thing I don't understand about the notion that expensive gas will drive us to alternate fuels:

 

If that's true' date=' then why hasn't Europe invented *warp* drive by now? I mean the price of gas is so high there, you'd think we'd have colonized half the galaxy by now.

 

Europeans aren't stupid -- they continue to forefront many areas of scientific discovery. So is it possible there's a flaw in the logic there?[/quote']

 

I think you will find that the aveage European drives a lot less than the average American.

 

Also, even at the prices that Europeans are now paying, gas is not that high in price.

 

In America, the highest that gas ever got was in 1978 when we were paying right at $1.50 a gallon. If you adjust that for inflation, it comes to 4.39 in 2005 American dollars.

 

http://data.bls.gov/cgi-bin/cpicalc.pl

 

I wouldn't look for any real big breakthorough in alternate fuel before oil hits 100$ pr. bbl. and that with the understanding that it is not a temporary thing.

 

At the current price of fuel in America, it is nothing more than an irritation.

[Aardvark]

I think you will find that the aveage European drives a lot less than the average American.

 

Also' date=' even at the prices that Europeans are now paying, gas is not that high in price.

[/quote']

 

I'm afraid you are mistaken about that, the price is pretty high. The average price for unleaded petrol in the USA is about 27pence (UK) a litre. In the UK the price is more than 75pence. One of the cheapest places for petrol in Europe is Spain, at only 56pence a litre.

 

When i hear Americans complain about the price of 'gas' i silently pray for a real oil crisis.

 

On another note, you are right about what the 'experts' predicted about oil supplies in the 1970's. I still have a special edition of the National Geographic printed in special red covers, warning how there would not be any petrol stations left on roads in 2000 as oil would be far too scarce for it to be used by cars.

[reverse]

so by logic then, if you increase the price of something, then is it automatically consumed less.

 

Not all goods conform to that curve.

 

I have a question for you.

 

Would you all agree to not travel on one of the weekend days , I mean right now, in order to save fuel.

and do that for the rest of your lives.

 

What would it take for you to do that?

 

A big media blitz that made you feel guilty?

 

a Law that enforced six day travel?

 

I'm just considering how these things have influenced the consumption of Diamonds , tobacco, alcohol and drugs.

[TimeTraveler]

Times change, people adapt.

 

If you are looking for a reason to believe in adptation, it is simple--GREED.

 

I agree. And no matter what we will be forced to adapt, and I know we will. I am just concerned on how bad the problem gets before we do make those daptations. Its not just oil and gas prices that will be forced to increase but also product prices, food, basically everything. Shipping and trucking will become alot more expensive to maintain, agriculture and packaging, basically everything will boom in price and those adaptations will take alot of time.

 

I don't know exactly what will happen, no one can predict the future. And like I said I think we should be pessamistic, when you challenge something and say "we are going to be screwed" its a challenge to everyone. People respond to challenges and make the effort to prove pessamists wrong and show how much human innovation, adaptation and inginuity we still hold.

 

The best thing we can do is start raising awareness. How many people really understand what peak oil is? Not alot. We need to educate them. We need to convince them that this is serious, and alot of major corporations, shipping industries, car manufacturers, agriculture industry, and on and on need to take steps to begin weening themselves of oil addiction.

[reverse]

timetreveler.

 

I have been considering how to make your direction occur.

As If the president phoned me up and gave me the job right now.

 

I would feel obliged to point out to him that the American dream and consumer lifestyle would need to be realigned, and to remember that he was from Texas.

And to be sure he knew the knock on effects of this realignment.

 

I would suggest that we hit at the "demand" end of the supply and demand line.

 

I would also ask him for one tonne of money to put into advertising campaigns in order to redirect the public psyche.

 

I would have to admit that it was a pity that the media could not be controlled as in the communist and Nazi campaigns, and that youth could not be indoctrinated.

 

I would ask him if he could give me access to any sort of media control, particularly in the early school reading material. That would be the slowest fruit to ripen but the most productive.

 

This sort of social engineering is always difficult with a free media.

[syntax252]

I'm afraid you are mistaken about that' date=' the price is pretty high. The average price for unleaded petrol in the USA is about 27pence (UK) a litre. In the UK the price is more than 75pence. One of the cheapest places for petrol in Europe is Spain, at only 56pence a litre.

 

When i hear Americans complain about the price of 'gas' i silently pray for a real oil crisis.

 

On another note, you are right about what the 'experts' predicted about oil supplies in the 1970's. I still have a special edition of the National Geographic printed in special red covers, warning how there would not be any petrol stations left on roads in 2000 as oil would be far too scarce for it to be used by cars.[/quote']

 

As I pointed out in another post, gas in America was $1.50 in 1978 and if it was adjusted for inflation that would be 4.39 pr. gal in 2005 dollars, so we have had gas prices higher than they are now by quite a margin.

 

In Europe, I think the average distance drivin is a year would be less than the American average of about 15.000 miles. So I think that that is why those high prices are tolerable there. Also, how much of that is in the form of one tax or another?