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Energy Crisis As Early As 2016
Submitted by Dan Steffes via OilPrice.com,
Low oil prices today may be setting the world up for an oil shortage as early as 2016. Today we have just 2% more crude oil supply than demand and the price of gasoline is under $2.00/gallon in Texas. If oil supply falls too far, we could see gasoline prices doubling within 18 months. For a commodity as critical to our standard of living as oil is, it only takes a small shortage to drive up the price.
On Thanksgiving Day, 2014 Saudi Arabia decided to maintain their crude oil output of approximately 9.5 million barrels per day. They’ve taken this action despite the fact that they know the world’s oil markets are currently over-supplied by an estimated 1.5 million barrels per day and the severe financial pain it is causing many of the other OPEC nations. By now you are all aware this has caused a sharp drop in global crude oil prices and has a dark cloud hanging over the energy sector. I believe this will be a short-lived dip in the long history of crude oil price cycles. Oil prices have always bounced back and this is not going to be an exception.
To put this in prospective, the world currently consumes about 93.5 million barrels per day of liquid fuels, not all of which are made from crude oil. About 17% of the world’s total fuel supply comes from natural gas liquids (“NGLs”) and biofuels.
One thing that drives the Bears opinion that oil prices will go lower during the first half of 2015 is that demand does decline during the first half of each year. Since most humans live in the northern hemisphere, weather does have an impact on demand. I agree that this fact will play a part in keeping oil prices depressed for the next few months. However, low gasoline prices in the U.S. are certain to play a part in the fuel demand outlook for this year’s vacation driving season.

Brent oil prices are now hovering around $60 a barrel. In my opinion, this is quite a bit lower than Saudi Arabia thought the price would go and may lead to an “Emergency” OPEC meeting during the first quarter. But for now, I am assuming that Saudi Arabia is willing to let the other OPEC members suffer until the next scheduled OPEC meeting in June.
The commonly held belief is that Saudi Arabia is doing this to put a stop to the rapid growth of production from the U.S. shale oil plays. Others believe it is their goal to crush the Russian and Iranian economies. If the oil price remains at the current level for a few months longer it will do all of the above.
My forecast models for 2015 assume that crude oil prices will remain depressed during the first quarter, then slowly ramp up and accelerate as next winter approaches. I believe that by December we will see a much tighter oil market and significantly higher prices. In a December 24, 2014 article in The National, Steven Kopits managing director of Princeton Energy Advisors states that, “In permitting low oil prices, the Saudis seek to bring the market back into equilibrium. At present, our calculation of break-even system-wide is in the $85–$100 a barrel range on a Brent basis.”
Mark Mobius, an economist and regular guest on Bloomberg TV recently said he sees Brent rebounding to $90/bbl by the end of 2015.
Since 2005, only North America has been able to add meaningful crude oil supply. Outside of Canada and the United States (including the Gulf of Mexico), the rest of the world’s crude oil production netted to a decline of a million barrels per day from December, 2010 to December, 2013. More than half of the OPEC nations are now in decline. We’ve been able to supplement our fuel supply during the last ten years with biofuels, but that is limited since we need the farmland for food supply.

I believe the current low crude oil price could be overkill and result in the next “Energy Crisis” by early 2016. Enjoy these low gasoline prices while they last.
The upstream U.S. oil companies we follow closely are all announcing 20% to 50% cuts in capital spending for 2015. We will start seeing the impact on supply at the same time the annual increase in demand kicks in. Our model portfolio companies are all expected to report year-over-year increases in production, but at a much slower pace than the last few years.
A study released by Credit Suisse two weeks ago shows that U.S. independents expect capital-expenditure (Capex) cuts of one-third against production gains of 10 per cent next year. This would imply production growth of 600,000 bpd of shale liquids, and perhaps another 200,000 bpd from Gulf of Mexico deepwater projects. At the same time, U.S. conventional onshore production continues to fall. I have seen estimates of 500,000 to 700,000 bpd declines within twelve months. If these forecasts are accurate, U.S. oil production growth would be barely positive next year and headed for a material downturn in 2016.
North American unconventionals (oil sands, shale and other tight formations) have been almost all of net global supply growth since 2005. If unconventional growth grinds to zero and conventional growth is falling outright, the supply side heading into 2016 looks highly compromised. At today’s oil price, only the “Sweet Spots” in the North American Shale Plays and the Canadian Oil Sands generate decent financial returns to justify the massive capital requirements needed to continue development. Global deepwater exploration is rapidly coming to a halt.
Were demand growth muted, this might not matter. Demand for liquid fuels goes up year-after-year. It even increased in 2008 during the “Great Recession” and ramped up sharply during 2009 and 2010 despite a sluggish global economy. Low fuel prices are increasing demand today and my guess is that, with U.S. GDP growth now forecast at 5% in 2015, we could see demand for fuels increase by close to 1.5 million barrels per day this year. The current IEA forecast is for oil demand to increase by 900,000 bpd in 2015.
If this plays out, the oil markets will be heading into a significant squeeze in the first half of 2016.
The last extended period of low oil prices was 1985 to 1990. In 1985, when oil prices collapsed similar to what’s happening now, the world had 13 million bpd of spare capacity, with 7 million bpd in Saudi Arabia alone. OPEC was well-positioned to comfortably meet any increase in demand.
Today, just about all of the world’s discretionary spare capacity resides in Saudi Arabia and amounts to an estimate 2 million bpd. Lou Powers, an EPG member and author of “The World Energy Dilemma," has said that Saudi Arabia will have difficulty maintaining production at over 10 million bpd for an extended period. If we do swing to a supply shortage, Saudi Arabia may find itself in the position of needing to run the taps full out for much of 2016. In such an event, the world will be headed right back into an oil shock and we will see much higher oil prices than $100/bbl.
Low oil prices will hurt the unhedged upstream companies, but they will hurt the oilfield services sector the most. I’m expecting the onshore active rig count to drop by 30% by mid-2015. Oil price will need to firm up for several months before the upstream companies commit to higher spending levels. That said, the high quality drillers like Helmerich & Payne (HP), Patterson-UTI Energy (PTEN) and Precision Drilling Corp. (PDS) will be fine since a lot of their high end rigs will keep working on long-term contracts. By 2016, they will have gained market share.
Remember, North America and deepwater are the only places with meaningful production upside. If crude oil prices move below $60/bbl and stay there for even six months it could prove catastrophic to non-OPEC supply. At some point, OPEC action may become necessary.
“But perhaps not by the Saudis. Russia’s position is comparable to Saudi Arabia’s. Either could cut production by meaningful quantity, but the Russians need the incremental revenue more. Saudi Arabia would be right to argue that any calls for production cuts should be directed to Moscow. OPEC could cut production to prop up prices and increase revenues. But for now, a better strategy (for Saudi Arabia) would be to hang back, deflect criticism, and let events play out. If the Russians are thinking clearly, Moscow will cut first.” - Steven Kopits the managing director of Princeton Energy Advisors.
The best news for all of us is that Iran may be quite willing to put an end to their nuclear enrichment program a few months from now. I believe this is the real reason for what Saudi Arabia is doing.
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I remember swapping license plates to be able to get gas on odd and even days. Those were the days my friend.....
Ha! Never thougth of that but I was not there.... Brilliant!
Whistle a happy tune, oil bitches.
The Rothschilds mouthpiece, 'The Economist', says low oil prices for 5 years.
Then there is the dawning of the age of electric cars. Permanent pressure on the price of "liquid fuels".
It's the new normal.
an economy in a depression doesnt consume as much energy. Some shale and deepwater drilling operations will get wiped out in bankrupcy, supply will drop, so then eventually prices will rise. All that oil will still be there, just sitting, and eventually it will be profitable to drill in those places again, and someone will go pump it out of the ground. Hell, if the rest of these countries are so cheap to pump oil, we should get the easy stuff from the middle east first anyway, then just leave those people to their own devices.
Resources exist to be consumed. And consumed they will be, if not by this generation then by some future. By what right does this forgotten future seek to deny us our birthright? None I say! Let us take what is ours, chew and eat our fill.
CEO Nwabudike Morgan
"The Ethics of Greed"
Does this mean the eco-fascists are givin Musk another 26 billion to play with?
https://www.youtube.com/watch?v=VI6tBwVjyOY
We can thank this future energy squeeze on the CBs and banksters. Rot in hell.
Why isn't anyone suggesting that crude should be bought now (at low prices) to refilled the strategic reserves and balance the supply and demand. Too sensible I guess.
Why stop at the reserves? Why not just buy the companies that hold the drilling rights and then sell them off to the highest bidder when the price explodes again
Ya, what we got is another "expert" that "knows" what oil is going to do and has a paid newsletter.
Go to his Oil prices . com site and look at the comments on his own site! They are tearing him a new one.
These experts need to be horsewhipped for lying, misrepresenting or just running their mouths when they do not have a clue.
"The Economist" is merely trying to justify to the uninformed the results of American recommended saltwater EOR (Enhansed Oil Recovery) on Saudi wells in the Ghawar, which will likely take around 5 years to subside (at which time they will be in signifiant trouble unless the technology significantly improves) and has left the Saudi's with no choice but to pump (anybody know who much freeboard they have left in Okinawa, Rotterdam and/or Sidi Kerir??).
The reality is going to be different, as BRIC consumption patterns, especially in IC, will absorb the 2% in less than 18 months, as they have significant demand elasticity as compared to 1st world countries. China is already filling to the brim its SPR (like any good capitalist) India is banking on low gas prices to boost the level of mobility in the country (general movement, not necessarily migration) to provide larger scale for some industries it wishes to own (including a few they would like to wrest from China) by creating larger regional markets.
It has been said that players in American intelligence would like to see the US economy nose dive about a quarter before the elections (August anyone) so that the Republicans can have a better shot at the Presidency, and that was another reason for initiating the oil price crash. This onion gets messier the deeper it is pealed. The clear winner in all this will be China; the fight is now over who will have which place in the loser's pecking order.
Been wondering about the validity of the EOR story since it broke a couple of weeks ago (Wayne Madsen report). The EIA are under the impression that EOR is not required in the Saudi fields:
http://www.eia.gov/countries/cab.cfm?fips=sa
More digging to be required on this lead...
Charlie Schumer and Co certainly caused the run on Indy Bank and talked down the economy prior to the 2008 election.
"Then there is the dawning of the age of electric cars. Permanent pressure on the price of "liquid fuels"."
Brilliant, 1500 lbs of batteries may hold the energy potential of one gallon of diesel. Righton, we can haul water on our heads as well to avoid using those nasty pipes.
Dan:
This is all political bud. All political, just like '77.
Same shit different year. Your demand theory is bullshit, because if you would look, you would see the mells dont drive...
The demand you require to meet your goal seeked "energy crisis", simply does not exist.
There will never be the demand for oil that once was because of one simple little reason.
There is a legion of young people that will never drive further than the game store, because they do not have the upbringing to be upwardly mobile, therefore, without upward mobility, there can be no demand.
Not now, not ever like it was.
There are two generations raised in fear, and cannot leave the house. Don't you read????? Forty and down lives at home...
They do love to travel like crazy though....sideways mobility....and that takes a lot of oil.
I assume when these space pioneers figure out how to fly then they will be doing a lot of space tourism too
One of the reasons I bought a trailered boat with a 300 gallon gas tank. You need to think outside the box.
The sky is perpetually falling.
Chairman Volcker...{W}e don’t have a lot of room for maneuver and I
don’t think we want to use up all our ammunition right now in a really
dramatic action; I don’t see that the exchange market or anything else
really requires that at the moment. Certainly dramatic action would not be
understood without more of a crisis atmosphere than there is at the
moment. Ordinarily I tend to think we ought to keep our ammunition
reserved as much as possible for more of a crisis situation where we have
a rather clear public backing for whatever drastic action we take. (FOMC
Transcript, 9/14/1979, pp. 22-23)
The Sky is not falling anymore...it is at one foot above sea level.
So many either have no memory of the 70's, didn't experience it or have no concept that this whole thing has played before. End of the world and economy? Maybe, but we'll see gas lines all over again before then. I still remember running the push mower - the one WITHOUT an engine, just spinning blades - over the lawn cuz nobody was pissing fuel away to mow.
GO TO HELL SHELL!
The gas lines in the 70's were due to the Arab oil embargo. There was no real global shortage of oil supply. The Arabs simply refused to sell their oil to the west. The US started pumping oil and that was the end of the embargo.
Well, actually the US Gov't made a Faustian bargain w/ the Family Saud...the birth of the PetroDollar I think it's called.
yup
there's nothing the war on terror, putin, people or error
can change about oil and our population
except waste more
That is exactly right Falcon. After Nixon decouple the US from gold and pissed of A LOT of central banking countries, Saudia Arabia acted. We merely went over and told them (politely) that we would be friends or we would make the king's palace the largest parking lot the world had ever seen.
The gas lines were caused by socialists who didnt want to see prices reach fair market value.
ha ha
I remember running out of go-kart gas as a kid and finding 35cents in the couch cushions and we were back in business.
and that was the hourly wage back then wasn't it?
That was before the license plate scanners and the days of total Orwellian surveillance. Back then you still had some liberty.
I'm so confused. Which way do I wind my doomsday clock?
Well BACKWARDS obviously!
Very pithy comment.
If you make it to 2016, your energy worries will center around calories.
Gut check!
such optimists here tonight!
New Year Resolution 2016
Lose weight.
Hitlery/Bush 2016. More chains we can believe in.
Yes we have no price discovery.
Like every other 'market' - oil is being driven down by unseen forces.
What is absolutely mind-blowing to me is that the average person does not think twice about it. Oil has basically fallen by half for no obvious reason (to the average guy), yet the average guy if asked about it will say "I don't know why, but I'm lovin' it!". They won't even consider the fact that they have been ass raped for the last few years paying more. Or they will chalk it up to the fact that ass raping is just a fact of life. The fact that "they" can get away with this kind of blatant manipulation of the price of something everyone uses every single day, explains exactly why we're fucked.
The fact that "they" can get away with this kind of blatant manipulation of the price of something everyone uses every single day, explains exactly why we're fucked.
The trick here is to smash yourself over the head with a concrete block. This will allow for the correct thought patterns to be released.
"or they will chalk it up to the fact that ass raping is just a fact of life"
After the past few years, wouldn't you say that ass raping IS a fact of life?
you wish
ass rapes
by the crass apes
fed with human blood
and grapes
Agreed. But they WILL wake up when a loaf of bread is $20 and a gallon of milk is "whatcha got?". We bash the sheep here on ZH, but when they can't feed themselves and/or family, is where and when the rubber meets the road.
The sheep deserve bashing because they won't pay attention until your $20 bread. And when that happens, it will be too late. Meanwhile, we as a country debate which of the sons, daughters, wives and brothers of past Presidents will win next time. Because we are a free society that is not ruled by Royalty.
Let it be so.
Yeah, this doesn't fit the liberal meme of blaming the US oil corps for high prices. It also doesn't help the peak oil/climate change meme.
Thanks for pointing out another reason we're fucked (the "liberal" this and that bullshit).
Well, we did'nt get to this point in our cultural breakdown and financial condition because of following a conservative ideology. Just a reminder.
I have no interest in an endless back and forth with you tonight, but I will "remind" you of two things and then leave you to post away:
Conservative ideology favors deregulation of banks and financial markets.
"Conservative ideology favors deregulation of banks and financial markets."
That is NOT conservative ideology and you know it. Sometimes I wonder if you actually believe the leftist BS. I used to think you were just a player benefitting from perpetuating the liberal meme, I'm starting to think you're a true believer. Conservative ideology would bring us to a pre-Progressive, pre-Keynesian, pre-Fed Reserve, pre-Fiat currency, pre-Welfare state honest condition.
Banking institutions are more dangerous to our liberties than standing armies.
-Thomas Jefferson
Harb is correct, Rand. Perhaps you are thinking of neo-cons?
"Conservative ideology favors deregulation of banks and financial markets."
That is NOT conservative ideology
-----------------------------------
Yep, Harbanger, you are 100% correct. LTER is really a closet Lib.
Says the fuckhole with the Obama icon, which clearly suggests he is the problem and not a puppet.
What is "liberal" and "conservative?" Obama is liberal, then?
This debate is pointless. To 95% of America, "conservative" means Rick Santorum or some such bullshit. "Liberal" means Nancy Pelosi or Obama. Your friend Harbanger still defends Reagan, and likes Ayn Rand whose friend Greenspan is more to blame for this mess than any politician I can think of. But keep on dreaming of Galt's Gultch or whatever crazy ass shit keeps you warm at night.
No, he is not zee problem you Nazi gay bastard, he just has a difference of opinion. You know what is "liberal" and what is "conservative, don't be a douche rand. If you want to talk about your friend Harbanger, then speak to him directly. He still loves you Lola. BTW- I never said I like Ayn or Reagan, but like you, I kinda like Paul craig Roberts, the guy who claims to have co-founded "Reaganomics".
Hey, LTER just called me a "fuckhole!"
I'm truly honored...
It's always great to be able to draw out LTER's most eloquent looney-Liberal rhetoric and thinking.
Supply side was probably more a theory proposed by Jack Kemp, and ultimately sold to Reagan.
Why do you closet liberals like you, LTER, get so worked up when you're outed? I never see conservatives or libertarians pretending to be they're not something other than conservatives or libertarians -- in fact, it is a sign of pride for us to be identified as such. Liberals ... they run and hide.
Tells you all you need to know about liberalism, really.
Deregulation is a very wide moat when you dig into the thousands of pages of federal statutes and regulations governing the banking industry. Free enterprise ideology would have cleared out the major financial offenders from 2008/2009. The only gov't interference that I would support, and unfortunately the only interference seemingly off the table by the DemPublican Party is breaking up the TBTF cartel.
Consider: Nixon, a republican, signed the legislation to pull gold out from behind US currency. That was a big mistake. Basically, we defaulted on the entire planet. Second big mistake: Clinton signed legislation to repeal the Glass-Steagal act, on the books since 1933. This was the legislation that prevented banks and investment houses from gambling with depositor's money. Up until then, they invested and bet with their own money from profits on commissions and trades. Clinton was handed this legislation by both democrats and republicans. These two things are mainly responsible for setting us up for the paper circus we see now. Doesn't matter which side you blame, does it?
Yeah but LBJ, a progressive, defacto defaulted US Gov't debt when he refused to repatriate gold requested back by Charles De-Gaulle's (sp) gov't and was able to get the Legislative Branch to redirect social security tax receipts into the general treasury. So we probably agree that the DemPervs are socialist-fascists and the Goiter Ole Party are fascist-socialists.
+10 Silverer. She is right. Pay attention. This talk of conservatives vs. libs vs whogivesashitanymore is getting stale. They have played us. They have almost won. We have to know how to think outside their box.
I didn't say she wasn't correct, only that Nixon gets all the credit, when in fact he merely codified what had already occurred in a previous Administration.
That's more of a Laissez Faire ideology. There should be controls on Capitalism such as Glass-Steagall and other measures. We should have a level economic game field. Remember that Clinton repealed Glass-Steagall and we got the Greatest Depression of 2008 (ongoing).
I like your arguments LTER and your reasoning even when I don't agree. But Conservatives do not favor deregulation of banks and financial markets. The rules worked.
What we didn't recognize in 1999 was the existence of "RINO's", "DINO's" and two teams owned by the same franchise.
hey liberal JO! Left = right. Point guns and take peoples money and bribe the voters. tax us, build tanks and planes then stuff our kids into them and let them burn for fun. Fuck your name too. 'whatever her flaws, the loopy cranky bitch was was all about people, not systems. You should try to read some of her work. Do what is best for you. Raise your IQ.
you all over thinking this: it is the zirp and is that simple, read the stockman article. 50 trillion worldwide of loaning(zirping), money creation, brought about to recover from the depths of wall st's greed driven mortgage folly. unintended and it's a bitch, bitchezz.
Please reconsider the use of the term "liberal." The Dems are progressive socialists. The Goiter Ole Party are progressive fascists.
I'm going to help you with this. You'll be able to relax a bit, and maybe feel better, if just for awhile. I think most Americans are below average. Now that would explain it, right?
It doesn't really make me feel better, in fact, it makes me feel terrified, that the mainstream of American body politic is possibly no more sophisticated than a 17th Century French peasant.
Then there are many on the lower economic scale & foodstamps that are no more sophisticated than a 17th century rock.
Oh really?
Bet that 17th century pheasant couldn't operate a smart phone!
Talk about sophisticated ....
I'm reasonably a well-read, semi-educated, fifty entity corporate controller who has no clue how to operate a smart phone. My cell phone is a $10 by-the-minute toss-away. $40 lasts me six months.
most just don't give a damn
you are right...
I remember changing the plastic placards of the prices from 68 cents to 69 cents a gallon, in the 1970's when I worked my first yob pumping gasssssssssssssssssssss.
35 cents here plus 1.65 an hour and could afford car gas insurance and an occassional date...summer job...
yes sir. 1.65 bagging groceries, 35 cent gas, and 12 pack 1.99, box of 12 ga schells 1.99 and a weekend of crazy fun...66 chev for 200 to get about. and still living in the parents basement, hehe, 18...
Damn you guys are OLD!
(that felt sooo good to say)
I remember changing them from $0.23 to $0.52.
I've wondered why the russians don't announce a cut in production to prop up the price if possible. Pump less and get more money. Seems like the big producers are on the hamster wheel now
I speculate that the Russians, Iran and now Brazil have all stated that they are increasing production because they now WANT the price to fall further. The US and Saudis may have started the price drop to hurt Russia, but if it keeps going down it will hurt the US more!
Federal coffers aren't reliant upon petroleum revenues, unlike the Russian and Iranian gov'ts. I suspect you know this, but are wishful thinking aloud.
I would expect most of Russian oil to flow to China and worldwide demand for OPEC reduced by China's. And China is willing to "overpay" Russia to help offset US sanctions.
That 'Double Helix' is pretty damned convincing.
maybe it will stop the east coast from becoming completely submerged :snark:
No shit.
Are PowerShares the double long play when the time comes?
Anyone have a triple long play?
JHF (John Holmes Fund). Triple long.
For the Children...
I like the way he tries to pin the blame on Saudi Arabia for global overprodution, when they only produce roughly 10% of the worlds crude oil. All oil producers should share the blame, as none of them seem to be backing off production in a climate of over supply, a race to the bottom where the expensive producers will run out of money to keep up their production. A good example of selective pressure at work. Survival of the fittest.
You mean it will take THAT long to re-program the algos to be bullish on oil!
The evil oil cartel mafia cannot aggressively raise rates any faster than they lowered them, and the peak price of a barrel has been tested over time and will not top out at more than we have already endured. I don't agree with the crisis prospects given that CANADAs wonks have been stating that this lowered oil pricing will help Canadian consumers over time. If the rates were going to immediately return to high prices our politicians would not be running positive spin knowing it would reflect badly down the road.
I believe that oil prices are being driven the Chinese economy imploding as much as a supply shock. Demand will take a while to recover, as Chinese stockpiling as a big part of it. Needless to say, it has burned them badly.
Hilarious. It's called supply, demand and malinvestment. The barman just figured out the customer buying all the booze couldn't really pay the tab. Now he has to cut his losses and sell as much as possible to the paying customers he still has left.
Going back to basics its production that pays for production. The mistake was the great Keynesian fallacy that it is demand that is important. The banks have debased the currency to simulate demand and therefore the price increased. It stimulated additional demand and shale came on line.
This is just another bubble popping, just like the sub prime and the Nasdaq, it's just that popping bubbles aren't obvious. Malinvestment is unwinding. Up to now the banks have just goosed the market each time, but eventually capital is destroyed and no one is left in the Ponzi scheme.
This is the point at which all those that have been making a mint out of buying the dip will realise how worthless all that paper really was. It was after all just paper and not actual production. All the assets in the world are useless when there isn't a market for them. The bible has a passage dedicated to those that hord and watch their precious metal and jewels rotting to dust.
All those honest entrepreneurs, savers and workers who served each other and were thrown out of the game bankrupted, pushed onto the dole, left with crappy service jobs or had their savings stolen are no longer in a position to re-organise and start up businesses, save or reskill without a long period of time.
They killed the golden goose with their greed and corruption of money. They just haven't realised what it is they have done.
Math Quiz
94 mm bbl a day x 365 = 34,310 mm bbl
34,310,000,000 x $40 a bbl (savings off of government preferred price) = $1,372,400,000,000.
Individuals save 1.4 trilion dollars if this goes on for a year.
Governments and oil companies lose 1.4 trillion dollars of revenue a year.
Governments and oil companies expect to make it all back later when the price goes back up.
If individuals blow their 1.4 trillion dollars in savings on stupid stuff, they will get what they deserve when prices go back up.
If individuals take these bonus savings and use them to buy increased energy efficiency, solar panels, wind generators, efficient cars, et al., governments and oil companies will not make it all back later due to the flat-lined demand.
People need to disassociate their interests from those of any government and look at what this opportunity means to them personally rather than to their nation collectively.
Reject the hive mind and live free.
"If individuals take these bonus savings and use them to buy increased energy efficiency, solar panels, wind generators, efficient cars, et al., governments and oil companies will not make it all back later due to the flat-lined demand."
If they did, but they won't. "They [>95%]" will just piss any savings at the pump up against the wall on cheap chinese trinkets & shit. You can bank on it. Unfortunately, people really are that stupid.
>>If they did, but they won't. "They [>95%]" will just piss any savings at the pump up against the wall on food and clothing and maybe a home that doesn't have a windshield full of parking tickets.<<
FIFY........ you are Welcome.....
solar panels and wind generators are very inefficient. A waste of money without gov. Subsidy they will not pay for themselves. Wind turbines are not legal where I live anyway. Paying off debt would have the most benefit.
I've always been interested in solar energy...all the way back to the first gov't engineered geewiz promotion by Jimmy Carter. The technology a generation later is no more a good investment by the average person now than back in the late 70's. It's too bad, but it is true.
I hear that sentiment a lot but I cannot really susbscribe to it or necessarily understand the basis for it..... let me say this about that: Obama has been absolutely one of the best things that could ever have happened to the solar energy crowd in this country ...... now before you spit the dummy .......
You see in the aftermath of the whole debacle with Solyndra yielded drops in Solar electric panel prices to sub 1 USD/Watt for very good quality panels and if you knew where to shop panels could be had for less than half that. 5000 watts for 5000 dollars, ain't no way in hell you ever saw prices that low in all of history- a couple of decades ago the price was easily north of 10 dollars/watt at fire sales. Just a bit of a tangential rant here ... I always find the anti solar it ain't worth it crowd somewhat full of shit on this point without qualifying the statement.... worth is proportional to need or desire - if you want energy independence solar panels and wind turbines have value, if you want to compare to a 15 cent/KWhr utility bill maybe not so much..... and adjusted for inflation since the Carter years what is the price of Solar today.... exactly.... Yeah thought so ....ok rant over.
So yeah 10000 watts for 10 K-USD not so bad, particularly if you are willing to work with the local grid - assuming it has some semblence of reliability - and go grid tie net metering though in that case installing more than your average daily usage is not that great a benefit. Other niceties like solar trackers can boost output depending on your latitude.
Then there is solar heating, the vast majority of our energy usage goes toward heating something or cooling something - again there are options from solar ponds to evaporative cooling and again your choice depends on your need and willingness to alter your lifestyle. If you are of the mind to get away from the epicentre of cesspooldom you have options from Stabilized Insulated Rammed Earth to Straw-bale to Adobe etc, hell there are even people living in houses they've built by filling old tires - it's actually a lot neater than it sounds. But for sure living in urban or suburban environments solar energy is likely not going to work well but then it never was was it??
So yeah we can change our lifestyles and put a lot more independence in our lives........ or we can just keep doing what we are doing and just be happy we have a hole in our ass.....
Hopefully your math is better than mine and you're correct about the 1.4$T. Now this remark may grate on your nerves but I want to say this to illustrate how absurd bordering on insane this makes the Green Climate Fund bullshit that practically dominated the talks in Peru last month appear. In case you missed it, they went on and on about it and as the "donations" trickled in. The announcements were kabuki-like. Well they finally reached the $10B goal and everyone strutted around like it was some big accomplishment. Money they don't have for things they hardly understand and yet prance around with their chests puffed out. Sheesh.
So say this big drop in oil price wasn't happening. Well we've all been paying high oil prices for enough years that we've begrudgingly adjusted and although we're not real happy about it, life has gone on. Chances are if the high prices continued we'd survive another year. So suppose "the government and oil companies" suggested that the $1.4T go straight into the GCF? *hears heads exploding*
Not only would that be a colossal mountain of money that would keep the Least Developed Countries (LDCs), The Small Island States, etc etc etc real busy with clean development mechanism (CDMs) projects for years to come thereby getting the work done instead of sending reps to conferences hammering about "loss and damages" and climate justice, there would be whacks of money for some necessary projects in all countries, and Detroit.
10B$ compared to $1.4T$ ?
ONE year.
1,372,400,000,000/7,500,000,000= (roughly) $183 per person on the planet. That's less than a year's worth of Big Mac's let alone a measly down payment on solar.
Who needs oil when you are preparing for nuclear war.
is this like those global warming predictions that they have to change to global climate change...because they are 100% wrong all the time?
No they are not. They tell you have to pay the IRS and you do it.
In an age where progressive political hacks have discovered that they can rigg markets and use monetary policy to make the debt problem "go away", it's not irrational to believe that this drop in oil prices is all about "messin with Putin".
I will ride my OAS puts out till the end but I am thinking about going long either UCO or UWTI here. This is beyond ridiculousness. Gas is fucking 1.69 in Kansas Shitty. Just fucking halved that like because of supply/demand/glut issues. Bull fucking shit. It was driven down on purpose by the higher powers which means it will be driven higher by the same dirty filthy fucks.
The last oil crisis in 1973 coincided with a decoupling of the $ from Au
Why not vice versa. The oil crisis of _ _ _ _ to put the US at least partially back on the Gold standard
It would fit the recent move to put 1/2 the new $100 Bill in Gold
Allow for a global reset of their current reserve currency status
Contribute to the globalists goal to take America down a step or two down the
Would be the end result of the signal sent on 11/26/2014 for a rapid upcoming rise in gold
And the collars put on possible large rapid increases in PM's including Gold set shortly after this
And...... the above content should be enough to keep you busy
After all it is the upcoming year of the Sheep
If Volkswagen ressurects the diesel Rabbit, we'll be fine.
Seriously, though, oil related economic convulsions may be the big story for the next year, and could be the first of a domino series of black swan events.
As OPEC production has declined and other oil producers have expanded OPEC can no longer control the price of oil.
Well it could, but would damage its own revenues to benefit the new kids on the block like the US and Russia.
Now oil prices are at the mercy of markets and their inherent short term outlook.
One of the main believers in markets is the US and all its shale players are funded by those short term markets.
The shale players get hammered first as they can never take any long term view being funded by Wall Street.
Perhaps Saudi is demonstarting the importance of Cartels in commodities that are of vital importance and need long term projects to extract.
With oil, cartels are probably better than the short term outlook markets.
Everyone just needs to join a new OPEC and stability can be restored.
Let's do the maths:
Saudi produces 9.5 million barrels per day and there is an over supply of 1.5 million barrels per day (quite small).
For those 9.5 million barrels per day it now getting $50 per barrel.
= $475 million.
If it cut 1.5 million supply and demand would be on a knife edge and oil would go back up to $100.
Revenue = 8 X 100 = $800 million
Saudi in the short term is not making a rational decision, but doesn't want to be the one that always has to cut production to keep prices high.
All players would benefit from some long term planning and stability by forming a cartel.
And you based all that fucking shite you just wrote on information from criminal banks and poncing academics that don't know a fucking used condom from a sausage casing.
For fucks sake, GLOBAL demand is crashing and the crash is coming and it will keep on coming through ,15 ,16 and ,17 and if you lucky after the wars are dying down, global demand might start to pick ip again.
$20 is a good starting point for a rally