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Did WikiLeaks Confirm "Peak Oil"? Saudi Said To Have Overstated Crude Oil Reserves By 300 Billion Barrels (40%)
In what can be the "Holy Grail" moment for the peak oil movement, Wikileaks has just released 4 cables that may confirm that as broadly speculated by the peak oil "fringe", the theories about an imminent crude crunch may be in fact true. As the Guardian reports on 4 just declassified cables, "The US fears that Saudi Arabia, the world's largest crude oil exporter, may not have enough reserves to prevent oil prices escalating, confidential cables from its embassy in Riyadh show. The cables, released by WikiLeaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300bn barrels – nearly 40%." Could the OPEC cartel's capacity for virtually unlimited supply expansion to keep up with demand have been nothing but a bluff? That is the case according to Sadad al-Husseini, a geologist and former head of exploration at the Saudi oil monopoly Aramco, who met with the US consul general in Riyadh in November 2007 and "told the US diplomat that Aramco's 12.5m barrel-a-day capacity needed to keep a lid on prices could not be reached." And yes, that conspiracy concept of peak oil is specifically referenced: "According to the cables, which date between 2007-09, Husseini said Saudi Arabia might reach an output of 12m barrels a day in 10 years but before then – possibly as early as 2012 – global oil production would have hit its highest point. This crunch point is known as "peak oil"." And it gets worse: "Husseini said that at that point Aramco would not be able to stop the rise of global oil prices because the Saudi energy industry had overstated its recoverable reserves to spur foreign investment. He argued that Aramco had badly underestimated the time needed to bring new oil on tap." Look for Saudi Arabia to go into full damage control mode, alleging that these cables reference nothing but lies. In the meantime, look for China to continue quietly stockpiling the one asset which as was just pointed out is the key one to hold, for both bulls and bears, according to Marc Faber.
More from the Guardian:
One cable said: "According to al-Husseini, the crux of the issue is twofold. First, it is possible that Saudi reserves are not as bountiful as sometimes described, and the timeline for their production not as unrestrained as Aramco and energy optimists would like to portray."
It went on: "In a presentation, Abdallah al-Saif, current Aramco senior vice-president for exploration, reported that Aramco has 716bn barrels of total reserves, of which 51% are recoverable, and that in 20 years Aramco will have 900bn barrels of reserves.
"Al-Husseini disagrees with this analysis, believing Aramco's reserves are overstated by as much as 300bn barrels. In his view once 50% of original proven reserves has been reached … a steady output in decline will ensue and no amount of effort will be able to stop it. He believes that what will result is a plateau in total output that will last approximately 15 years followed by decreasing output."
The US consul then told Washington: "While al-Husseini fundamentally contradicts the Aramco company line, he is no doomsday theorist. His pedigree, experience and outlook demand that his predictions be thoughtfully considered."
Seven months later, the US embassy in Riyadh went further in two more cables. "Our mission now questions how much the Saudis can now substantively influence the crude markets over the long term. Clearly they can drive prices up, but we question whether they any longer have the power to drive prices down for a prolonged period."
A fourth cable, in October 2009, claimed that escalating electricity demand by Saudi Arabia may further constrain Saudi oil exports. "Demand [for electricity] is expected to grow 10% a year over the next decade as a result of population and economic growth. As a result it will need to double its generation capacity to 68,000MW in 2018," it said.
It also reported major project delays and accidents as "evidence that the Saudi Aramco is having to run harder to stay in place – to replace the decline in existing production." While fears of premature "peak oil" and Saudi production problems had been expressed before, no US official has come close to saying this in public.
The conclusion:
Jeremy Leggett, convenor of the UK Industry Taskforce on Peak Oil and Energy Security, said: "We are asleep at the wheel here: choosing to ignore a threat to the global economy that is quite as bad as the credit crunch, quite possibly worse."
Obviously, if true, the implications of this discovery are massive, and will have a huge impact on the price of oil imminently.
The four key cables can be found at the links below.
- Saudi oil company oversold ability to increase production, embassy told
- Saudi Arabia tackles western shift towards energy independence
- US queries Saudi Arabia's influence over oil prices
- US concern over Saudi Arabia oil production
»
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cretin
A Person that is: brainless, stupid, child-like, and full of pointless information that makes no sense and appeals only to other cretins. They can be found in abundance in every single populated internet forum, where they race to post as many mind-numbing messages as possible in a single session. In addition, they seemingly interbreed with other cretins, ensuring that their cretinous genes continue long after they end up dead meaning the Internet will never be rid of their kind. More's the pity.
The term cretin is a medical term which describes a person so affected with the condition, but, as with words such as spastic and lunatic, it can also have a vulgar connotation and can be used disparagingly. Cretin became a medical term in the 18th century, from an Alpine French dialect; it saw wide medical use in the 19th and early 20th centuries, and then spread more widely in popular English as a markedly derogatory term for a person who behaves stupidly. Because of its pejorative connotations in popular speech, health-care workers have mostly abandoned cretin.
Meh, "Synaptically-Challenged" works for me! :>D
I think most people come here to talk economics and markets. We do not start by pointing out that Obama is the worst POS to hold any office in this country along with his corrupt Chicago scum. We pretty much lay off but these lefty idiots start it up every time. Every time they start in.
What is with this insane hatred of Palin? She is not in office. She is not bankrupting the country and engaging in levels of corruption worse than we have ever seen in our lifetimes out of Obama, Geithner, Bernank and the banksters.
And who on the left wants to audit and hopefully destroy the Fed? No one. The only ones are Rand and Ron Paul. I do not see a D after their name. God help both of them for at least trying. And who has talked about really trying to stop the spending madness - Paul Ryan, Christie and a few other Repubs.
Hi Troll!Care to comment on the fun Ronnie oversaw RE liquidating companies and out sourcing?Thanks!
These liquidated companies and out-sourcers, how many of them did "Ronnie" own? Check your premises.
Are you a Republicrat or a Demublican? If you belong to one party, you belong to the other.
haha, you got junked... somebody still doesn't get it.
sad isn't it
So... what,
are you saying she is the present day equivalent to a Ronald Reagan?
Thank you for pointing out what you so greatly fear. The amalgam of those ideas and others skillfully crafted will be the lefts undoing in this country and into the political wilderness for three of four generations you go. Take Frances Fox-Pivens advice and get more energetic and then your dead end philosophy will be gone for five to seven generations.
yes
That was just a teaser.
Wikileaks is the Ponzi blowing gas.
Things are said that could not otherwise be said and it provides needed dramatic distraction. It's very useful. Obedient even. Will not discuss 9/11.
I'm begining to think Wiki is in bed with the illuminati. All starting to make sence with Internet off switch, and now this. I would not be shocked 5 years from now if Wiki was govt run.
www.silvergoldsilver.blogspot.com
BINGO!!!!! We have a winner.
Now theres an interesting thought. Why 5 years? Why couldn't they be a false flag operation now. Seems the easiest way to clamp down on the internet is to have somebody raise a big enough ruckus and spill a bunch of information, mostly bogus information, but for the sheeple good enough. And why is this stuff being released in such a timely manner to keep pace with whats going on? hmmm... makes me wonder. Seems like a lot of bees nest whacking with little result.
The information was declassified before release...
really, someone who "stole" "secret" information waited until it was declassifide to release it. Ya, I have ocean front property to sell you in Montana too.
Peak oil again, seems a rather desperate attempt this time around to refocus the US on the middle east and why we need to keep boots on the ground. Forget about freedom and Egypt, its the new domino effect where Muslims will overthrow all US sponsored dictatorships! Next thing you know, they will be free and sell all the oil to China denominated in Rubles!
The Internet is useful. Spew massive amounts of information from every perspective and create a white noise that is impossible to navigate. Toss in a few GRU stories that nudge and influence in the direction you want to go in....
I'm begining to think Wiki is in bed with the illuminati.
Admitting such a problem is the first step on the road to recovery.
black swan????
No Way! Peak oil problems have been known for a long time. If you're surprised, you haven't been paying attention. Listen to Puplava Saturday mornings for continuing discussion of this issue.
sunny
Exactly. This should not come as a surprise.
+20M bbl/day
Yup. Still nice to see admissions
For a better understanding of peak oil, I've been using The Oil Drum website for the last 5 or so years.
http://www.theoildrum.com/
warning the discussions can get technical, and spam and trolls aren't tolerated. Think before you post. Its really one of the best sites for accurate information and discussion of peak oil, and if you think peak oil isn't a real problem, please explain how an infinite resource can exist on a finite planet.
Have no fears, according to the memo oil production doesn't peak until 2012, then its a plateau for a decade, plenty of time to cram a lifetime of living into. Another round of drinks for my friends, whats the sense of getting sober, when you just have to start all over again?
dick cheneys ghost
Abiotic Oil Bitchez!
Put it in the bunker next to the abiotic gold.
this must be a critical topic because the troll is in overtime
Is wiki leak a government psy ops, false flags, where is BofA data - charade, created to manipulate, distract and side track from more important global events?
As far as this Saudi oil revelation story, cant remember from where, but I read this several years ago already. Does not look like a revelation at all.
Don't worry. The 22.5% unemployed won't be using much of it in the foreseeable future.
The US military will.They have an insatiable thirst for it...which explains much of our current policy.
WikiLeaks: Gov psy ops or Elite psy ops or beacon of truth. Who knows. Navigate cautiously and trust nothing but your own well reasoned conclusions. A normalcy bias will be your enemy and you will need to remain untarnished by an avalanche of disinformation. Tyler may indeed be the only human that can be trusted...;)
Look at a graph of the stated reserves vs. time right around when the quotas were set based on reserves. That's when the big lying started. Later, as stocks became 99% about speculation for ownership and not dividends, all the oil companies have to suppress very simple concept that is peak oil. The only graph that matters is the one that shows discovered crude peaking 40 years ago. All the talk in the world won't change that graph.
The only graph that matters is the one that shows discovered crude peaking 40 years ago. All the talk in the world won't change that graph.
++
or the wars
Sorry double post
This stinks to high heaven.
Not saying it isn't true. Just smells ...
Agreed. Faced with limited supply, why on Earth are the Saudis holding prices down? They should be shouting this from the rooftops. To hell with the global economy--$250 oil would concentrate much of the world's wealth in their hands before their production began to decline.
In addition, if their reserves are so low, how are they able to maintain their current output? Why haven't prices increased?
If this is true, it puts peak oil a lot closer, at the point where it is likely to create a major negative impact prior to being made moot by new technology. If this is true, we need to know NOW so we don't run out prior to development of those technologies.
If you need to know, dig into the data. The data has told us for 5 years somthing was amiss....
I'll repost it from another thread:
1) Recent storage data on tankers show that off-shore storage is about 60-80 m bbls. To put this number into context, it is about 1 day of demand or 2 days or net oil exports from producers.
2) Net Oil exports from producers peaked in 2005. There is simply less oil on the market. This chart is the tell:
http://www.theoildrum.com/node/7327#comment-756659
3) Sometime in 2008, the forward oil curve went into contango for the first time. They was a lot of debate about what this implied. My take is that the smart money figured out that demand would be outstripping supply into the foreseeable future. In essence, it now trades like a currency.
4) Breakdown what is called oil into its real components
C+C, NGL, Other liquids
Now, generously give an EROEI of 6 on “other liquids”, in other words from an energy perspective multiply by 0.85, otherwise you double count the oil to produce the liquids.
NGL is 65% of the energy density of crude
Ignore Refinery Gains, that is simply increasing the volume for the same energy content…
And fold in existing fields are declining at 4.5% (CERA, IHS etc..) per annum and that new fields are barely keeping up.
http://www.theoildrum.com/node/7385
The energy of Liquids production has been flat for 5 years.
This is why oil is the alpha asset.
And I am plenty long precious metals as well.
All of that can easily be ascribed to slowing global demand due to capital destruction, especially in the US (post 2008).
1. Storing oil offshore is a relatively new phenomenon. It is very expensive compared to onshore storage. Use of this method of storage implies that there is little onshore storage available.
2. Less oil on the market could just as easily be from reduced demand. Just because your faucet isn't spewing water doesn't mean your well has run dry.
3. Contango implies a large available physical supply. You are confusing contango with backwardation, which is the situation you would expect if people were worried about future prodution.
4. Not really sure why the energy contained in a given volume of crude should be changing...
This does not mean that Peak Oil is not real. My points are just evidence against it. If the article is true, then that is a major blow, as noted above.
Because there's a growing difference between genuine crude oil and the total production of liquid hydrocarbons that is increasingly being reported as daily or annual "oil production." That's where the issues of NGLs and refinery gain become important in seeing that things are not as rosy as sometimes portrayed.
NGLs are useful, but are reported by volume and, as flakmeister points out, do not have the same energy content as crude oil. Refinery gain is another volume measure that disguises reality. It mostly represents the sophistication of US and some other western refineries in their ability to convert a huge range of oils, some basically sulfurous goop, into gasoline, kerosene and diesel. It's great to get valuable product from the heavier parts of crude (some of which trade at a discount to unrefined crude) but the volume reporting makes things look rosy, when in reality the extra volume is coming from cracking big molecules into smaller ones, a process which uses energy and slightly decreases the total amount of useful energy coming out of the refinery as product.
Great explanation...
Dead on.Chemistry is your friend.This also explains why the valuable aromatics like xylene and toluene are so crazy high, and why pump gas is so craptacular.(even taking into account the ethanol added)
Good point, thanks.
Google refinery gains....
Oil was historically in backwardation until '08, what changed?
Net oil exports peaked in 05, long before any economic storm was even on the horizon.
Yes. Oil price was the cause, not the effect.
Oil, like any commodity that is used up, should be in backwardation at least some of the time. The emergence of contango was likely due to a large number of speculators entering the arena. They drove the price up, but didn't want the actual oil, and rolled their contracts. This disrupted the standard supply/demand dynamic. Since these guys weren't taking delivery, oil suppliers were forced to find any means possible to store that oil, including the desperation measure of renting oil tankers to use as floating storage tanks. Once even that capacity was gone, they were forced to flood the spot market with the supply coming in at the new high prices. This crashed the price.
When oil was plentiful, it was always in backwardation, especially at the far end. The curve has changed, it has the same significance as Silver going into backwardation.
It signifies that the game is nearing the end....
point 4 - all reserves' EROI are not the same.
For example, tarsands require very substantial energy invested in order to yield the barrel of oil equivalent. The classic C&C surface deposits were EROI 100:1, returning 100 boe vs 1 invested in extraction. Tarsands are far lower, anywhere from 6-15:1.
As far as peak being "confirmed" by Wikileaks, jeez, the data showing the C&C peak in 05/06 is 5 years old now.
In addition,we will run out of NG (processing tar sands) in North America before we can process all the tar sands...
Hey it takes good money (gold) to make bad money (paper). It takes good energy (oil) to make bad energy tar sands. This energy ponzi could just work out. This time it's different.
Research already ongoing to just burn the oil for the required heat for SAGD and upgrading. Just keeps kicking that can on the EROEI, not to mention environmental footprint. I think we will never run out of oil, just like we didn't run out of whale oil. It will be replaced. The unfortunate part is that it will be replaced with coal and expensive renewables which our fake economy can't handle.
And don't forget all that water
Except it WASN'T A PEAK.
Peaks look like this: /\
What we have looks like this: /''
This revelation is a strong piece of evidence supporting "peak oil is here" fearmongering, but it certainly isn't proof. It could just as easily have been a bit of cloak and dagger attempting to force the US to allow the Saudis to raise the oil price. Until we see an actual decline, or the Saudis come out with real, verified numbers, this is all speculation.
What you call "fearmongering" some of us call "awareness raising". ;-)
TPOG
That's what they said about global warming. You will forgive me for being skeptical. This "crisis" begs for government intervention, carbon taxes, rationing, etc.
Disagree with the proposed solutions all you want, but AGW denial at this point is some serious flat-earth syndrome.
You can say that all you want, but that doesn't make it so.
Lots of people say the same about Global Warming. Others say that about Keynesian economics. Why should we all just accept that peak oil is here when the evidence just plain isn't there (though these leaks are evidence that it is coming much sooner than otherwise expected).
The difference being a mountain of scientific evidence for the former, while the latter is relegated to the echo chambers of endless debate (like all economics, it's difficult to pin down).
Increased radiation at the frequencies reflected by CO2 isn't a lie.
Decrease in output at the same frequencies when measured from space: not a lie.
Melting ice: not a lie.
Higher highs and less lows...least squares fit to a monotically rising air temp.
Even worse if you consider the ever-growing heat content of the ocean.
These are physically-verifiable facts, not opinions.
www.skepticalscience.com
If you've ever taken calculus, you'll remember that little bit about the derivative going to 0 at the local maximum of a function...not necessarily an inflection point, but the point at which the derivative will never be positive again. Granted, we're talking about the change of rate of a change of rate, but the math works out the same.
And even if some process were spewing oil from within the rocks, those bacteria would have to be chewing oil fast enough to keep up with an exponential growth in demand (people: still fucking...and more of them want to drive than ever) for this related rates problem to end without disaster . At some point in the (possibly very) near future, it will simply not be possible for us to find / drill / refine enough fast enough. Period.
You can't defeat the mathematics of this PDE any more than we can borrow our way out of debt or dig a hole to the moon.
Tell you what give us the set of facts or observatiosn that disprove your religion and I will take it seriously. Until you adherents let us know how it is falsifiable it is not science it is your religion, capiche?
the thing with global warming is that there are so many variables that affect contested theories, and not enough measurement, for there to be a consensus. Part of it may be that one group of people does not want to do the hard work to learn the facts, whatever they may be. It is hard work to convince yourself, for some people.
but with peak oil -- how complicated are numbers that describe reserves and rates of production and consumption? With peak oil, though, there are possibly people who prefer to keep a lid on the data, while with global warming, people just don't want to believe (- if it is so the case; people focusing on cold winters as proof against Global Warming is one example of pointing to a small bit of data to support their theory without bothering to learn if there is other data)
How about the fact that the amount of heat forcing from CO2 (the TOTAL, not the delta since the industrial revolution) is less than the NOISE from water vapor in the atmosphere?
How about the fact that the heat capacity of CO2 is less than that of the average atmospheric mix, meaning that assuming a constant atmospheric volume, increased CO2 concentration should DECREASE the temperature? Everyone has accepted the "fact" that CO2 causes warming, but I have never seen an actual analysis of why this is so. These types of errors creep into science. Someone fudges their methods, or includes an error in a paper, and it get cited, and those papers get cited, along with the original, and so on, without anyone repeating the experiment until you build a whole branch of science off of a single mistake.
I discovered something similar recently in my own group's research. It was reletively minor, but predicted results did not materialize. Looking back through the literature, I found out that the basis for this false data was an uncited assertion in a book published in 1977. Here it was 34 years later, screwing up our research. These things happen. Especially when fixing the error would destroy the branch of science they got their degree in, and the study section they get their grants from.
Still waiting for the set of observations or facts that disprove GW. If you cannot supply this you have by definition not science but a faith based religion. Grok that..
jfc...now you are going to qualitatively define what a peak is?
A peak is the maximum amount. Everest has a couple of summits, and one highest point. As viewed from the north face, it looks really rather like a plateau up there.
Most mountains are like that; their summits are not a fucking point like on your dunce cap
Alright, I admit it. I'm woefully ignorant on the topic of Peak Oil. I know about The Oil Drum, but are there any books you can recommend for a beginner?
Here's a couple:
Matt Simmons Twilight in the Desert
James Howard Kunstler The Long Emergency
The Limits to Growth: The 30-year Update by D.H. Meadows, Jorgen Randers, and Dennis L. Meadows
A few websites for you to consider:
IMHO theoildrum.com has fantastic articles on energy and the quality of the posts is generally very high (with little noise)
http://www.howtoboilafrog.com/peakoil.html
http://hubbertpeak.com/
http://www.oilcrash.com/index.htm
http://peakoil.com/
here's a story that is topical right now: http://www.newcolonist.com/dim_ages.html
“My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel.” Saudi saying.
"Jesus fucking christ" I've beaten you over the head with this point a dozen times. Don't pretend like it is something new.
And take a 4th grade geology class, since you don't seem to know the difference. You can't legitimately claim a top until there is a significant decline (might throw in a stats class to learn what "significant" means--I am not being snarky here, this is a difficult subject, even for scientists with dozens or hundreds of publications). Until there is, you're just a top-calling troll.
look, man, I dunno how to get through to you...I've tried everything.
I would have thought that IEA's admission that C&C peak is FIVE YEARS in the rearview mirror would have been enough, but your dunce cap simply renders you impervious to anything
4th grade geology tells us the difference between a peak and a plateau. Show me a statistically significant decline, and I will admit that you were right, peak oil is upon us, and we are all going to die next Thursday. Until then, there is INSUFFICIENT EVIDENCE TO SUPPORT YOUR CLAIM.
We have not increased liquid based energy in 5 years, Net Exports peaked in '05. We are at best on a plateau, and at worst, starting to tip over.
Where have I ever said big government of whatever was needed to fix things? I am just making people aware, simple as that. I have my ass covered, I took care of that a few years back....
Not "at best". We are. If you want to be taken seriously, then reporting the facts as they exist alongside your interpretation of them is advised.
We, at least I cannot post graphs, I can provide links. If you don't look at the graphs, then what can I do? Did you even look at the links?
Someone posted a table of Saudi net exports vs avg. price below...
http://www.theoildrum.com/node/5576
http://www.crudeoilpeak.com/?page_id=51
Here is a proper analysis of the situation from today, I suggest you dig in:
http://www.theoildrum.com/node/7465
good stuff. This is my favorite comment from that thread:
"would be less concerned about the WikiLeaks item and more concerned about the actual data–-Saudi net oil exports versus annual oil prices. The Saudi’s ongoing post-2005 decline in net oil exports, in response to generally rising oil prices (annual oil prices showed year over year increases in four years out of five), is in marked contrast to their rapid increase in net oil exports, in response to rising oil prices, from 2002 to 2005.
This decline in Saudi production and net oil exports (relative to 2005), versus rising oil prices, is quite similar to what we saw in post-peak regions like Texas and the North Sea.
But the prevailing message from the MSM can be summarized as follows, “Party On Dudes
Great post, but 99% of the people who understand it are fully knowledgeable about peak oil and could have written almost the same. Sigh.
For anyone interested in learning about reality, please visit:
http://www.theoildrum.com/
it is worse than that.
In previous PO threads, I've referenced the world oil outlook, which shows time-to-peak and YoY decline curves for various reserves classes, the surface fields, offshore, and deepwater.
As the fields move into the higher-hanging-fruit class, the time-to-peak is shorter for any given well/field and the decline rate is far steeper.
The real kicker is that ALL of the hailmary oil finds have been in deeper and deeper water, but these fields HAVE (empirically) peaked much sooner and declined far steeper than the old surface fields that most of the projections used as templates.
In addition, as a warning to the technocornucopians, the production curves of fields brought online post-late 60's have more resembled trapezoids than bells. The technology that was supposed to save us by permitting more oil to be extracted has instead served to shorten field life by increasing the rate at which oil was extracted. Jevon's Paradox writ large.
For example, Saudi fields like Ghawar are still producing, whereas giant and supergiant fields like Cantarell, N. Slope, North Sea, Forties, etc., are already effectively dead. The savior technology merely pulled forward the bell curve into a trapezoid where production was ramped up much faster to a peak plateau maintained usually for 8-10 years, and then declines plunged at 15% YoY for Prudhoe, and as much as 33% for Cantarell. The technology didn't extend the field life, it merely made extraction faster.
This is the conundrum of exponential growth.
Average YoY declines of surface fields are in the 3-4% neighborhood, the old producing fields. For deepwater finds, you're looking at 9.5%+ YoY on average. This means that our more recent fields will see veritable production collapses once they fall off the plateau.
That KSA's reserves were overstated is hardly a secret. Peak Oil was only adequately explained to a highly intelligent friend of mine by referring to it as a NET energy peak, not a liquids peak.
I don't know how much more evidence needs to be marshaled before idiots can get that it don't get no realer than this. Surely, I will scroll down the thread and again be amazed, no doubt.
Again, go back and put the "new finds" on the histogram of oil discovered vs. year and they don't even make a dent. Ghewar, Burgan, Cantrell were all the big daddies. They still produce at a water cut of 100 but there's no pot of gold hiding in Alaska or the Gulf that the commies and tree huggers are stopping us from getting.
Well done, but those new to Peak Oil may not realize the problem is worse than lack of reserves and falling production. Oil demand is growing fast in oil exporting countries - "Saudi Arabia may further constrain Saudi oil exports". In other words, there be less and less oil available for export; this effect is known as the 'exportland model' for those that visit The Oil Drum for further explnations.
People have to stop thinking that there is some big game afoot to raise the price of oil. Granted this will happen - but this is not some conspiracy - there just won't be enough oil to go around the world in the very near future.
yeah, I've commented on XLM in previous posts on this...it's hard to cover all the points each post without writing a treatise.
Average time from peak to importer is around 6 years, Indonesia, UK both around there. Mexico peaked in '04; they're right at the limit here
Came home from work - needed to unwind after being up to my elbows in blood.
Checked out the thread and got wound up by the total shit by muscle boy (peanut balls shrunk by steroids - didn't of that one did you when u picked the avatar) and red neck.
Scrolled down that crap and found some proper educated debate on this.
Well done boys and girls. This is important shit.
Much obliged...
"The technology didn't extend the field life, it merely made extraction faster." - in a nutshell
Two possibilities, and this has already been worked out.
1) They are like Lee Raymond (CEO Exxon in the 1970s). They believe they can go to 12 mbpd anytime they want, regardless of reserves. Arab cultures LOVE exaggeration. It's an admirable thing there. Raymond told Carter to ignore oil embargoes, that he could ramp up Texas to replace OPEC. He tried. He failed. Texas was post Peak, and even more so now. The Saudis could be as wrong.
2) They know. If you were they, and YOU knew, you would be insane to announce it. There is NO QUESTION that there would be a global beating of fists on desks to demand "fair sharing". No way in hell anyone is going to accept an arbiter's decision of fair sharing if it undercuts them. They will have to go take it. There would be war. Saudi citizens would die. And all you have to do to prevent that is simply keep your mouth shut until the day you tell your customers you're retiring and going out of business. No point in having a war in Saudi Arabia then. Nothing to fight over.
Maybe you'll remember that politician Carter making a speech back in the 70s with his cardigan on talking about cutting back - he didn't get reelected. Politicians never get elected when they tell you bad times are coming, so they don't. Remember the most important thing is how to get elected, the second most how to get re-elected. Rumour has it that Clinton spoke about this on his first day in the White House.
$250 oil would concentrate much of the worlds wealth in Schwinn and Huffy.
Sorry, Giant Manufacturing of Taiwan is the worlds largest bicycle manufacturer and would hold the largest concentration of bicycle related wealth,growth and installed base. 3 billion Chinese can'tbe wrong - pedal your ass off.
There is no need to build new bicycle trails in urban areas, because in 10 years all the roads will become bicycle trails.
...and in 20 years all the roads will become horse and oxen trails. You can't make a bike chain or spokes out of leather, but you sure can make reins and a saddle from it.
Why would they hold prices down? Look at what's happening in Egypt. Then imagine that happening everywhere because expensive oil = expensive food and expensive transportation, and thus everything becoming less affordable. Then imagine an angry and hungry lynch mob beheading the Saudi royal family, and possibly eating their remains. Then imagine countries seriously considering alternatives to oil. Then imagine Saudi Arabia's economy declining further, their only other abundant commodity being sand.
The current paradigm requires oil to be priced as high as possible but no higher. It is a tightrope walk, the Saudis and OPEC saw what happened when oil prices rose rapidly after and during the 70's oil embargo. They know that too high of an oil price destroys economic growth and destroys demand as well as encouraging research and development of alternative energy technologies. Since all of these factors are undesirable for maximum revenue and because of sunk cost for existing refineries and other oil drilling and pumping technologies, their is great inertia in exploring alternative energies as long as the price and availability remain "reasonable' - thus the oil producers do the dance, inflating the price until demand collapses and then failling back.
The price oscillation will continue right up to the point of societal collapse caused by insufficient petroleum supplies to feed, heat and clothe as well as provide medication and military defense, at which point they use the "stick anyone who can afford it for everything they got, pricing model'. Flexible pricing is an oil oligarchies best tool for beating a captive consumer over the head using his own artificial limb.
So oil prices remain in play until they become stratospheric and we fall backwards into actual serfdom, rather than economic serfdom.
Happy days - go long beans and rice.
A home garden is a project that teaches and feeds you.
Assange also claimed credit for the Climategate leaks which he had zero to do with in any capacity
Cables released by Wikileaks have documented US efforts to bribe an bully nations into adopting global carbon management.
So does their supposed leaks on BOFA... They have nothing the PTB don't want them to have.. How about Brad Manning he disappeared off the radar quickly.. Too quickly, imho..
How about Brad Manning he disappeared off the radar quickly.. Too quickly, imho..
Did you expect his torture to be conducted on live TV?
I never intimated that he be tortured or abused in any way. My point had you bothered was that the investigation of how Julian got the information seemed to dead end once the fall guy (manning) was in custody. When the supposed source is shut so completely off it tells me a conspiracy of larger proportions is possible or probable.
Check and Mate!
I think it has been apparent to industry insiders for some time that Aramco could not keep up the production levels they claimed. The world doesn't have infinite Anything. So not much of a Black Swan.
In human terms we have infinite solar energy.. When that runs out there are a few more out there..
Nice to see you around, Tom.
Ditto CD. Just got back from Brazil, interesting trip. Petrobras is a fascinating organization.
If what al-Husseini said comes to pass, the decision to leave Iraq will look incredibly foolish. It is the only place where known reserves could damper the effect of a Saudi supply crunch.
Of course, the real long term solution would be to become serious about energy conservation, but with all the rear echelon motherfuckers, teabaggers, reichpubliscums, Blue Dog Democrass and their unlimited, craven personal ambition and ideological blindness, this will happen only when it'll be almost too late.
Iraq's oil ministry is populated by insane fucks.
They presently pump 2 million bpd. They have said they will get to 13 million bpd by 2013.
There is no way in fucking hell they will get to 13 million bpd in 2013. Or in 2015. Or in 2017. Or in 2020. As best I recall, no country has ever gotten to 13 mbpd.
My prediction is they get to 4.5 or 5 mbpd by 2015, and stay there until they roll over their peak.
Of course, the real long term solution would be to become serious about energy conservation, but with all the rear echelon motherfuckers, teabaggers, reichpubliscums, Blue Dog Democrass and their unlimited, craven personal ambition and ideological blindness, this will happen only when it'll be almost too late.
Why do you hate the poor? Only increased production can ensure that there is enough of everything to go around. By encouraging others to sit on their hands and wail you lead them to certain death. But at least you've got that self righteous thing going for you...
Alberta Tar Sands
presently ~2 mm bpd.... maxes out at ~6 in 12 yrs, provided you throw 1 trillion or so at the infrastructure
What about the Orinoco belt in Venezuela?
It's similar, and has a poor EROEI. It may be of some use, but it's no savior. And it will be hard to use under the current political situation in Venezuela. Tossing aside any pretense of respect for democracy and national sovereignty, I wonder why we haven't already taken over Venezuela. We have the technology to get some useful oil out of that field.
Thanks for the info. Sort of what I thought. Chavez was bragging a lot about the reserves a few years back - he knows what's there, too.
In Venezuela, there's that little problem of Revolution.
Uncle Sam had his best shot in 2001, and he failed. Since then, he has failed again and again and again. Not only that, but in doing so, he's managed to trigger Revolutions of one type or another throughout the whole continent that have weakened his position.
When Chavez chose to nationalize the oil industry in Venezuela, he asserted his nation's Sovereign Right to do so. He recognized the danger to his dictatorial regime from multinational oil conglomerates and corporate whores such as Washington DC. He has taken steps to secure Venezuela's future, and his own, through such methods as trade agreements with Russia (oil for arms), and solidarity pacts with Iran (if one country is attacked, both are attacked).
Hugo Chavez is quite popular in South America. He also controls approximately 20 percent of the USA's crude oil needs, which Chavez has repeatedly warned he would impose an export embargo with. This is why Venezuela will not be attacked militarily in the near term. This is why Chavez can get away with talking so much trash about the USA.
Your comment seems to be a moral defense of Chavez. My comment regarded likely actions of a self-interested amoral actor. Whether Chavez is a good or bad person is an entirely different discussion than whether a hungry, amoral (or immoral) power will decide to take resources it wants.
You clearly defined that same "self-interested amoral actor" as the USA.
Did you have a point other than your obvious support for naked military aggression against a resource-rich nation who has committed no hostile act against you?
Politics and morality aside, I'd enjoy seeing the USA try to take South American oil by force. Those 100,000 AK-47's that Chavez swapped the Russians for a few years ago might come in handy.
I think you're having trouble with reasoning. I'm not proposing or supporting a course of action, I'm commenting on its likelihood. For comparison, if I say "South Florida will get hit by a hurricane next year," do you think I'm going to invent some hurricane-creating machine to steer a hurricane there? Or might I simply be commenting on rational probabilities.
As for this:
Laughable. There are private individuals in this country who own a large fraction of 100k AKMs (oh btw, they are AK-100 series rifles, not the obsolete AK-47; and when people say AK-47, unless they are collectors they really mean AKM, as the real deal AK-47 has been obsolete since the 1960's). If the US should decide to invade Venezuela, the biggest problem will be all the bills from companies like Halliburton, and divying up the loot between US oil companies with legitimate pre-Chavez claims (grounded in Venezuelan law), and the most politically connected oil companies at the time of the invasion.
Your knowledge of fire arms outweighs you understanding of the real limits of military power when fighting on foreign soil, I'd suggest you review the Vietnam debacle and realize how america would fight tooth and nail if someone invaded her to occupy and loot her assets - unless of course the occupying forces were compose of international bankers and the natives were incapacitated by obesity and cable television.
BTW pardon my ignorance but isn't ak47 and ak100 ammo the same?
Vietnam was a barely developed country that mostly wanted freedom from French colonialists. Ho Chi Minh initially thought the US would help him, not take over where the French left off. Big mistake on our part, compounded by propping up some brutally corrupt dictators. Little middle class to speak of, little real ideology, more just a desire for self-rule.
Venezuela is much more developed and more diverse, and Chavez barely got 50% support in any election. We might not be welcomed broadly, but we would probably get a large base of collaborators. A very different picture.
Anyway, I believe Chavez bought rifles using 5.45x39mm, which is the modern standard for the Soviet sphere of influence (Chinese use a different 5.8mm cartridge). The AK-47 and AKM used 7.62x39mm. The AK-74 introduced 5.45x39mm. The AK-100 series is available in both of those cartridges and also 5.56x45mm, the most similar NATO cartridge.
6?? Where'd u get 6? No credible forecast I've seen has it past 4-5mbpd. 6 would be nice but I'm not a believer in that.
Also, it's useful for contrast that the reserves of the tarsands are oft-cited as "large as Saudi," yet they can produce at most half the rate of production, and far less if we factor in the staggering amounts of NG burnt in order to steam mobilize the bitumen
I seen studies that suggest 6, if you assume turning Northern Alberta and Saskatchewan into Mordor. I have no doubt that this will occur..
Incredibly descriptive visual for the effect of tar sands mining...
my studies have shown 4-5 tops and that assumes pollution of every freshwater resource west of the Rockies...long COSWF anyway but the crown royalty trend is not looking good longterm
who needs water. Hummers first
- also Saudi crude is low in sulphur - referred to as sweet and therefore easily refined into gasoline and other fuels, whereas tar sands are essentially crap that needs alot more processing. So comparing reserves of Saudi Oil (as ephemeral as they may be) to tar sands is like comparing a steak to hamburger helper.
The energy needed to extract and process tar sands gives it around a 4 to 1 return on EROI, whereas Saudi crude is around 12 to 1.
The only meaningful way to use tar sands would be to build an electric generating plant on site and burn the tar sands to make electricity - of course you'll still get a crap load of pollutants and environmental damage, but you probably won't waste as much water. Its really robbing Peter to pay Paul either way you go.
and the $1 trillion does not include damage to the environment.........fully developed estimates put the clearcut in Northern Alberta at an area approximating the size of Florida, not to mention the the Athabasca watershed which runs all the way to the Artic Ocean.
the math looks relatively simple; the price of Oil is subsidized at the expense of the environment.
the logic looks more simple; if other readily and less expensive reserves were accessable then why develop the much more costlyTar Sands?
why develop the much more costly Tar Sands?...
Mr. Market reacts to (favorable) Sovereign power in deference to economic strength any day of the week. At least initially.
Or, to save easier pickens for price drops, when margins need to be maintained and/ or improved.
Less actually. Still sub 2 I think. As long as the price keeps going up they'll expand but they can't touch the loss from the peaking world supply through the physical bottleneck.
There's a mini-boom there that won't stop until costs of synthetic are higher than things like wind, then it will be over, but we're not going to give everybody in China and India a Ford Fairlane, that's for sure, and that's the kind of bullshit forecasting "economists" have been spouting for decades.
EROEI of 4 or less.
Absolutely mind-blowing water consumption and pollution.
Total destruction of the landscape.
Producing pretty much flat out as it is now.
It's true. It's just not new. It was not "years" ago, but TheOilDrum.com had articles on this Saudi Aramco guy a while ago. The content was pretty much what is in this article.
Which means, the story is consistent.
Come on, guys. This is not rocket science. Ghawar has been pumping for 60 years! It doesn't reach down to the center of the earth. It is the biggest discovered oil field on the planet and it's been pumping out of thin crust for 60 yrs.
It's not going to last forever. Nothing is. We just happen to be unlucky enough to be alive when its time came to have the straw scrape the bottom of the slurpee cup.
A lot of people are going to die in the upcoming wars. There is nothing that can be done about this other than . . . Win The Wars.
. . . Win The Wars.
Joshua: SHALL WE PLAY A GAME?
What's your problem? You can't read?
"There is nothing that can be done about this, other than . . . "
How is it you missed that part?
Sorry Crash, I only copied that which was applicable to my comment.
You state that nothing, other than winning the wars, can be done about this. I was pointing out that there will be no winners in nuclear war.
You are familiar with the cheesy 80's movie "War Games", aren't you?
FWIW, I totally agree with your post. It's just common sense that we have finite resources on earth.
. . . do you not realize that nukes are an outdated technology?
How fucking long ago were they invented?
WWIII will be about slaughtering people while keeping infrastructure intact. You need to stop living in the past, as does every idiot who brings up "omg M.A.D." during WWIII discussions.
Guess you never heard of a Neutron Bomb.
Have you read The Hot Zone?
http://en.wikipedia.org/wiki/The_Hot_Zone
FAW I thought Hu Jintao threw your ass in jail... Nice reasoning nuke s invented long ago are outdated tech.. I feel the same way about the wheel.. ha
Go away again..
Holy fuck you're retarded.
Do you really think that NO new weapons were invented since the development of nuclear weapons, which were invented before computer processing?
In addition to this, do you REALLY think the elites of the world would opt for M.A.D. with nukes, instead of deploying newer, slightly less destructive techniques? Seriously, you lack critical thinking capabilities. Shut the fuck up and stop posting here. This site has enough idiocy without yours adding to the pile.
My bad for being needlessly sensitive.
Ya, I know the film. Your comment suggested "avoid war at any cost", which would in this case mean "give everyone else your oil and trust that they will share with you so you have time to magically invent the solution".
That's what set me off. There is no solution.
My bad. You did nothing wrong.
Pop the bubble, bitchez!
grain of salt and all that but very interesting...
Patriot Act FAILED TO HAVE KEY PROVISIONS PASSED
RUN RON RUN
TD KEEP IT UP
hard to be sure, but the title sure suggests this is an oil thread.
yeah yeah i know sorry none of this is connected... fine self junked
Reject Apathy ZH!
NO TO REPUBLICANS (and (Mu)Barak)
NO TO AUSTRIAN SCHOOL-GHOULS
NO TO MASS GENOCIDE
Vote the Egyptian Revolution
You're junked. Again.
where is the ominous looking graph that appears in the preview? I need to see it! :P
It's a bit old... look here.
http://spacecollaborative.com.au/2030%20Sydney/Research/Sustainability/peakOil.html
thank you!
Infinite growth in a finite world. Compounding growth curves. The laws of thermodynamics and complex systems. Economics is voodoo.
Bought their own Nobel Prize just to pass themselves off as a science.
R.I.P. Mr. Simmons.
Newsflash: Assange tragically smashed to pieces errr cut to shreds err "drowned" in boating accident 50 miles from navigable water.
Wiki should be called BS leaks, a non-stop pile of Govt friendly propaganda.
Regards 'Peak Oil' we enter the realm of another hysterical leftie fantasy very possibly egged on by Big Corp righties.
America itself has hundreds of years of both its own coal and oil reserves which have been systematically banned from exploitation by the US Govt. If you want to know who is responsible for "energy insecurity" it's because Congress itself has prevented US production strangling its own supply from 40% of US use to 30% today. The entire reason the US is "dependent" on imports is because the US Govt has suffocated its own local industry.
Like all acts of Govt this is usually corruption by corporate monopolists who do not want small fresh companies exploiting American resources in competition with them. The 'ecological left' have been willing participants in this anti-competitive corporate stitch-up job of the previous free market in energy.
You're worried about Saudi Oil, ask the US Govt why it has throttled onshore oil, shallow offshore drilling and even temporarily under Obama the last vestiges of the US oil industry in deep water
YOU do not understand the politics of oil.
Peak Oil is a right wing concept. Not a left wing concept.
If Peak Oil is a threat, then we must drill. And Drill. AND DRILL. Why in hell would you not drill if it was getting scarce. If you sneer at Peak Oil, you're a left winger who does not want to drill.
The correct answer to Peak Oil is NOT CONSERVATION. THERE IS NO POINT.
The correct answer is Win The Wars That Are Inevitable. With fewer enemies, there is less oil consumption and more for us, whoever us is.
get your utterly corrupt US Govt out of the way of exploiting American resources and you can drill all you like; onshore, shallow offshore and deep offshore. The only thing standing in the way of US energy independence is your own bent to fuk Banana Republic of a Govt
You don't seem to understand that the "right" and the "left" are the same thing. Both want bigger government. Peak oil is an excellent excuse to use to justify bigger government. Much better than "global warming".
Tmosley
Yes we're absolutely on the same page on the left/right all the same Ponzi scheme