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Jeffrey Brown: To Understand The Oil Story, You Need To Understand Exports
Submitted by Adam Taggart via PeakProsperity.com,
Despite the attention-grabbing economic volatility that is dominating headlines, it's important to keep our eye on the energy story firmly in focus. This is especially true as the headlines we regularly read about Peak Oil being dead " are "manifestly false" according to this week's podcast guest, petroleum geologist Jeffrey Brown.
As concerning as the fact that global oil production has plateaued over the past decade, despite trillions invested in trying to goose it higher, are Brown's forecasting model for oil exports. His Export Land Model shows how rising internal consumption can swing (and has swung) countries from major exporters to permanent importers within a dizzyingly short period of time:
The crucial issue to understand about what has happened after 2005 is that we’ve had a very large increase in global gas production and natural gas liquids, but a much slower increase in crude plus condensate.
So, what I think has happened is the actual crude oil production has basically flatlined while the liquids associated with natural gas production, condensate and natural gas liquids, have continued to increase. So, we ask for the price of oil, we get the price of Brent or WTI; but when you ask for the volume of oil, you get some combination of crude, condensate, natural gas liquids, biofuels. So, the fact is that substitution has worked and is working in that they’re bringing on alternative substitutes, but they're only partial substitutes. The actual, physical volume of crude oil production has probably been flat to down since 2005. Over the past ten years, it has taken us trillions of dollars, basically, to keep us on an undulating plateau in actual crude oil production. What happens going forward?
So, basically, the conventional wisdom is the fact that we’ve seen an increase in liquids production, seems there’s no evidence of the peak in sight. And, I think in regard to crude oil production, that argument is manifestly false. I think that we’ve probably seen a peak in actual crude oil production, 45 and lower API gravities, despite trillions of dollars of upstream capex expenditures.
I started wondering in late 2005 what happens to oil exports from an exporting country, given a production decline and rising consumption. And, so I just started, I just constructed a simple little model. I assumed a production of about two million barrels a day or so at peak, consumption of one, and assumed production falls about 5% per year, basically what the North Sea did, and assumed consumption increases to 2.5% per year. What the model showed was that exports, net exports would go to zero in only nine years, even though a roughly modest production decline. So, the easy way to state it is giving an ongoing, inevitable decline in production, unless an exporting country cuts their domestic oil consumption at the same rate as the rate of decline in production, or at a faster rate, it’s a mathematical certainty that the net export decline rate, what they actually ship out to consumers will exceed the rate of decline in production. And, furthermore, it accelerates.
Click the play button below to listen to Chris' interview with Jeffrey Brown (43m:48s)
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Peak oil price is dead.
Quit beating this dead horse. It's embarrassing.
I'll wager they'll be blabbering about peak oil 200yrs from now. They've been doing it for the better part of my 56yrs so I think it's a safe bet.
//////
Wut? It's all above board, you can pay it to my great-grandchildren ;-)
As long as natural gas prices remain low liquid fuel costs will remain subdued. There is a 500 year supply of heavy oil and bitumin that can be converted to lighter oils via donor hydrogen from natural gas. It's just a matter of refining. Something like 20 million tons of natural gas is used yearly in the refining of oils.
Even if this is peak oil, which I doubt, it is certainly peak concern about oil.
Peak oil was only due to credit-driven demand. Credit collapse = demand collapse = price collapse.
Give it up, peak oilers.
LOL, it's the last gasp, the last rush of energy as the system musters all it has to keep going just a little bit longer.
Nice to see Export Land Theory on ZH.
I agree.
I have always thought that the ELM was very clever.
I wish some ZH's would spend 10 mins on actually understanding what 'Peak Oil' is really all about instead of the lame comments they express with confidence that really only demonstrate their lack of understanding.
Confusing oil price with production is as simplistic as thinking that 'rising prices IS inflation'.
Credit has absolutely played an enormous role in the story - but it is does not change the math.
It is not a difficult concept to undertand and the implications are enormous.
Correction: Oil Price Peak = Credit collapse = demand collapse = price collapse.
There....fixed it for you!
Personally I have a conflicting opinion by all the peak oil-coal-gas energy hype.
It is either, oligarchs sending bots & trolls to beat down assets to be gotten on the cheap or people who really can't digest what is known to be there who think what we exhale will be the death of us all. Either way, they're socially impaired, ecologically manipulative psycho's.
Sometimes I just want to throw them into a belching volcano ;-)
Imagine naming your website / theme "peak prosperity". I fucking hate Malthusians.
Key rule of thumb nwewn, doomers are always wildly wrong, and very occasionally partially right.
We can put the last bit down to sample noise. :-)
The main grounds for the predictions made by doomers are that natural resources are being strip-mined, at rates which far exceed what could be replaced. Therefore, as the limits of those resources upon a finite planet were reached, the conflicts between people for what remained would become increasingly intense.
I am not aware of any of the doomers' predictions based upon strip-mining the planet being wildly wrong, because those predictions were made about events in the future ... Throughout previous human history, it was always possible to exponentially increase the strip-mining of the planet's natural resources. There has never yet been a time when global limits to doing that were reached. Therefore, it is NOT correct to say that any of the doomer's predictions have been wildly wrong, since those basic predictions were always based upon events which have NOT YET HAPPENED. On the contrary, it is just beginning to appear that there are starting to be real global limits manifesting in the form of diminishing returns ...
Running into such real global limits to strip-mining the planet has never happened before. It primarily shows up first and foremost in paradoxical ways through the fundamentally fraudulent financial accounting systems that were "paying" for that runaway strip-mining to occur. The main basis for the doomers' opinions was the basic theory of exponential growth of the human population and total human activities, based on being able to strip-mine the planet, running into diminishing returns: Overshoot in a nutshell
For doomers to turn out to be wildly wrong, there would have to be some series of technological miracles, surpassed by even greater political miracles. For doomers to be right would take the future consequences of running into the limits of strip-mining the planet causing the collapse into chaos of the civilization that had been built on the basis of always continuing to do that throughout human history.
Of course, while some series of technological miracles, being surpassed by political miracles, is theoretically possible, it appears to be politically impossible for those to actually happen, due to the degree that civilization is now based upon systems whereby governments ENFORCE FRAUDS by privately controlled banks, through vicious feedback loops of POLITICAL FUNDING.
I think it's possible that the resource doomers are actually in denial about an1984/nuclear war eventuality and have transfered that fear to resource depletion.
Since it was exponential economic growth, backed by the threat of weapons of mass destruction, those two aspects were always united in their combined money/murder systems.
They are making motor oil out of natural gas, have been for quite a few years. It makes perfect synthetic oil blends. Making gasoline and diesel out of coal is very old technology as well. Peak oil is something oil producer like to promote.
To be honest with you, you don't have a clue.
Peak Oil occurring right now, in front of you. Why? Because there is a massive price plunge at the same time that oil production costs are sky-rocketing. Oil prices will never recover, Period. Oil will never cost 100 USD again. Not even 70 USD. It's not a glut, it's an under-demand.
US oil production from shale oil is down... but inventories are rising, oil price is lower, and the world is awash with oil it cannot afford to produce (because the end-consumer has been ruined in the process of producing this same unit of expensive oil - shale, deep-water, tar-sands...)
One year from now, US oil production (and global oil production) will be down, inventories will be overflown, and demand will sink more (The oil industry will use more oil volume, the rest of the economy will use less) - because the economy will be in a worse shape. In resume, Oil will be cheaper, but the economy won't improve. You should ask yourself why this phenomenon is taking place.
Hint: http://www.economic-undertow.com/ (From the same guy that forecast in 2012 an oil price plunge at the end of 2014, and said that Oil prices will never recover its previous levels... As a curiosity, it happens to be the same guy that took the same picture that was displayed on the front page of the NYT the 12th September, 2001 )
Keep beating the dead horse...
This is beyond stupid.
Something has eaten this poor creature's brain.
Hint: First have a coherent line of thought, then try to write something.
Must be that damned Amoeba, We definitely at peak brain eating Amoebas...
Yes...Look like this dog (real economy analyst) is telling you that the tail (the financial economy) has dropped. Worthwhlie debating if you are in barter economies.
Look at the trend on this chart of gasoline retail sales. http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=A103600001&f=M
Demand destruction becomes patently obvious once you look at the overall trend.
YES PEAK OIL IS WHY THE SAUDIS HAVE DEMOLISHED THEIR CASH FLOW.
Yo! Retards. PEAK OIL doesn't force huge producers to sqeeze out little guyz.
Price of 25 dollars a barrel coming soon!
http://viewlasvegasrealestate.com/page9.html
Mr. Harless, I'm flattered that you copied my avatar, but don't you think this is going to be a bit confusing???
...despite trillions of dollars of upstream capex expenditures.
Trillions?
See this talk by Steven Kopits, yes, trillions
http://energypolicy.columbia.edu/events-calendar/global-oil-market-forec...
if that is true then two things come to mind. zh talked at some length about the dearth of capex over the past few years which may be slightly exagerated if the energy sector has been spending that much. the other thing is that at $45/bbl the entire annual world production is currently worth less than $1.5T which means that energy sector capex is about to hit the wall. this, combined with the imminent decline in dividends, petrodollar recycling, and so forth is hardly bullish for equities going forward.
With a tee, sir.
https://www.youtube.com/watch?v=Iw54-yDc6Jg#t=1m58s
Agree, pull that much out along with letting go of well paid workers, pipe/drill/rigs/support equip/engineers, divys from investors, trades, etc. and we are likely witnessing much of the current economic decline from this one sector as it all has a multiplying effect across the economy. Not to mention the debt hole it will leave which could lead to the next unravelling.
Other:
Some see a light about 2 years out if they can make it, but what is this the light?
Why are they making so many gasoline autos?
Either they are real stupid, we are or there is some truth out there we can't see.
Have a look at page 18 from the Kopits slide pack. He claims $4 trillion on upstream exploration & production since 2005 (his talk was in 2014. From the same page "For comparison: ‘98-’05, $1.5 trillion spend added +8.6 mbpd crude production"
http://energypolicy.columbia.edu/sites/default/files/energy/Kopits%20-%2...
There are no Shortages for Dummies:
Professor Al Bartlett: I got a report recently (1991) from these giants (surface mining and deep underground mining) coal fields of Kentucky, West Virginia, and Virginia and they estimated that we have another 30 years (2021) before it becomes uneconomically to mine there.
https://www.youtube.com/watch?v=umFnrvcS6AQ&feature=youtu.be“#t=30m22s”
lol...ya, know the odd thing about "reports" and "estimations" from 1991?
They-are-just-that.
http://www.eia.gov/todayinenergy/detail.cfm?id=2930
nmewn,
It has been a while since we last exchanged posts. Anyway, and unfortunately, I have to dispute your conclusion.
And you would just have to look at Alaska oil. It’s in terminal decline.
Or, Diminishing Return:
If you visit Venango County, Pennsylvania, we will find the birth of the US oil industry. To this day, they still pumping oil out of it.
Can you tell how many barrels of oil it’s pumped?
40 barrels…………A YEAR!
http://www.roadsideamerica.com/story/15765
Hey Jeff great to read/hear your stuff again. Seems like those Oil Drum days were just a few weeks back. Can remember when you first shared your ELM concept and how realistic it is. . Got to admit am enjoying sub $2 gasoline but with the sense of upcoming dread.
Best to Jeff, Chris too!
Like war its a racket. A big and very profitable one. Between this and the fiat magic thing. A very effective control system.
price will ultimately curtail consumption, give it time...
It already did so - remember $147 oil in 2007, leading to the disaster of 2008? We have never recovered from that.
Well, West Texas ! You made ZH. Congrats.
Export Land Theory has not been given it's due in terms of importance. Most people just look production, but it is the EXPORT quantity is what is important.
From the old OilDrum days...
There will always be oil. The question is at what price.
The question is how much if any will be needed.
We’ve got us these factors keeping oil low for the foreseeable future (That’s to say at least the next 2-5 years but maybe even 10):
– Demand simply underperforming supply, the world economy is collapsing, mind you!
– Iranian oil coming online and later more Iraqi, Libyan and new oil wells elsewhere even from the North Sea
– U.S. shale still pumping under hedges some till 2017
– Natural gas steadily used more and more and dirt cheap because it can be found anywhere around the globe
– Coal is still widely used and still very cheap and reliable energy source
– More sun-energy sources used despite the low oil prices
– Canadian oil sands projects coming online several of which by 2017
There's fuck loads of oil left. The only issue is energy cost. It takes a huge amount of energy to refine tar sand. It's only profitable to refine tar sand and oil shale (not shale oil) if overall energy prices are low but liquid oil prices are high. We need to keep finding natural gas, or we need to build a lot more nuclear plants to generate the energy needed to refine low quality oil sources.
I'm not supposed to say anything about the huge deposits of oil beneath the Mississipi .. . .
If was there, they would have drilled it already instead of thru 5000 feet of water and another couple of thousand feet, while being in the path of hurricanes.
Bullshit.
It also takes a huge amount of fresh water resources, resources that are rapidly being depleted today.
Sorry to see some whom I consider having a reasonable grasp on other economic limits having such little grasp of the concepts of energy production. The world is finite and its resources therefore constrained. Most of the easy production has been realized. As Jeff and Chris discuss conventional and even shale oil production/fracking are barely holding serve on OIL production. The other liquids primarily being condensate don't deliver the same energy as oil. Yet the liquids production numbers distort the production numbers its not apples to apples in terms of total energy. Its like whiskey and 3.2 beer.....
I find it scary that those of you that can easily reconcile a declining economy with less output, less work driven miles, less disposible income can't see that lower demand is creating a temporary glut of cheap prices in the complex. All you have to do is look at the balance sheet devastation going on to realize the train wreck for what it is....
The telltale is that demand continues to decrease in spite of cheap prices....WTH. The master resource is pricing itself out of the ability of most to harness its power for econmic gain... noodle that one. Its called EROEI The low hanging fruit has been consumed....the economy struggles to produce oil at a price that facilitates growth.
Cheap oil is the canary in the crappy economy mine... the verification that even the advent of cheap resources cannot overcome the inertia.....and downward spriral of the central planners creation
It might also be mentioned that cheap oil not only drives companies to bankruptcy as it will likely do with shale and tar sands oil, but it discourages investment. As investment drops, so do long term oil field development projects which sometimes require 5-10 years lead time. So if and when demand does pick up, will we be in a position to take up the needed production? Doubtful.
The last thing to be considered is that the deposits being discovered today, indeed for the last 30 years or so, are tiny comnpared to the giant fields discovered in the 20th century - how will all those giant fields be replaced once the inevitable happens?
I figure we are in for some serious shit withing the next 10 years (from an energy perspective). From a monetary perspective, it probably won't make any difference since we are not likely to have an economy to support in 10 years.... ;-)
Great post
well said, nice post
the criminal lawyer in me says there is lots of circumstantial evidence that government and military intelligence have known these truths for some time. It is an amazing coincidence who is a terrorist, where they sit and how they can instantly become our friends
Been in the oil patch my whole life... I think we are one Chino Silkworm missle across the Straight of Hormuz away from $100 barrel oil.
We have more oil supply than demand today. That is a given. But the annual decline rate is at least 3%. That means just to spin in place, we have to add at least 3 million bpd of new oil production every year. That could be done at $80+ oil prices, but not at $50. In my opinion, sub $60 oil is an artificial price that can't last. Perhaps 12 to 24 more months, but that's about it. If oil companies are losing money, they are not going to drill very many new wells. And at $50 per bbl, they are ALL losing money.
At some point soon, they will all have cut back severely on their new oil drilling projects. This year they are burning through cash and betting on oil prices to rise. I don't think they will be as aggessive in 2016 after their balance sheets get hit hard from this year's blood bath in losses. What is the saying, the best solution for low prices, is low prices? They won't stay low very long. Just pay attention to next quarter's earnings reports by the large oil companies.
For those who are expecting oil prices to remain low for an extended period (more than 12 to 24 months), that can only happen if the following happen:
1) The global economy flounders in a big way (very possible).
2) OPEC maintains its high output (I think they want more money, and soon).
This might explain why Schlumberger and Haliburton are buying everything they can get their hands on.
When the shale oil bubble popped this was my first guess too, the big oil majors did not bet the farm on shale oil, if they did then they would be up to their necks in debt now.
Instead, if they have cash in the bank then I'd expect them to go on a spending spree now. While it is pure guess work to tell where the bottom is I am betting that distressed oil producers now will be a profitable long term buy.
I agree with everything you say, apart from #2 on the reasons for extended low prices.
OPEC are not masters of the market, they were back in the 1960's and 70's when they had tiny populations to support, but now they are slaves to the market, no better then subsistence farmers forced to pump oil every day just to survive.
They will continue to pump as much as they can for as long as they can, at least until their falling oil production/rising costs is unable to provide even subsistence level existence for their exponentially rising populations, then they'll implode.
So we have to make our best guesses on the market, there are many variables we do not know, but if I were to make a best guess on the future market I would factor in OPEC pumping furiously away for now until eternity :)
(And sorry, I couldn't resist!)
agree
The Saudi Royals know their ass will soon be grass (or sand) as the standard of living of their population continues to fall. They have nothing to lose ...at least for their own selfish sake...which is the only way they operate to pump it till the end. They also have a devil's pact with the US which adds the additional motivation
I like this Web site regarding the topic:
http://www.economic-undertow.com/
Steve Ludlum is able and willing to consider the realities that most of the petroleum resources were wasted, although I think he tends to underestimate the significance of how and why that is what happened.
The established systems became based upon fundamentally fraudulent financial accounting systems, whereby the public "money" supply could be created out of nothing, in order to "pay" for strip-mining the planet's natural resources. The ways that the political economy worked were based upon the principles and methods of organized crime. Ironically, that is what is actually most consistent with understanding human beings and civilizations as entropic pumps of environmental energy flows. However, the collective consequences of the political economy becoming based on governments ENFORCING FRAUDS by privately controlled banks are that the ways that the vast majority of people think about the "economy" could barely become any more absurdly backwards.
It is tremendously "ironic" to those who have a sufficiently macabre sense of humour, to consider the ways that human beings and civilization actually follow general energy systems. In general energy systems, the most labile components control the systems. In human terms that means that the most psychopathic people control civilization. There was a long history of backing up violence with lies that gradually became backing up lies with violence. There developed more sophisticated systems of legalized lies, backed by legalized violence, whose most important manifestations became that governments ENFORCED FRAUDS by privately controlled banks, which were able to create the public "money" supply out of nothing as debts, in order to "pay" for strip-mining the planet.
In general energy systems, those follow their own paths of least action, or least resistance. In human terms that means that civilization follows the path of least morality, which is consistent with society being dominated by those who were the best at backing up lies with violence, which gradually became the situation that all sociopolitical institutions are dominated by the best available professional liars and immaculate hypocrites. Of course, that especially applies to the domain of "economics."
Economics is actually a special case of warfare. Just as success in warfare was based upon deceits and treacheries, so too, real economics developed to be financial success based on ENFORCING FRAUDS, whereby fundamentally fraudulent financial accounting systems enabled the vicious spirals through sociopolitical systems controlled by their funding, and most especially, through vicious feedback looks of POLITICAL FUNDING.
The awesome "ironies" that have developed due to civilization necessarily operating according to the principles and methods of organized crimes result in series of intense paradoxes, which could be called consistent contradictions, which are due to the social successfulness of backing up lies with violence resulting in ENFORCING FRAUDS almost totally dominating civilization, in ways whereby everyone is proportionately successful within that society by their degree of participation within those systems based upon ENFORCING FRAUDS, which requires those consistent contradictions that their social successfulness depends upon the degree that they can continue to operate as the best available professional liars and immaculate hypocrites, who are able to deliberately ignore and be as willfully blind as possible to those central social facts that everything that they were doing was being done through fundamentally fraudulent financial accounting systems, that were based upon ENFORCING FRAUDS, which manifest through the intense paradoxes that almost everyone is simultaneously indulging in the same general attitudes, based on deliberately ignoring and denying what they were really doing.
Social systems based upon ENFORCING FRAUDS result in consistent contradictions, which are intense paradoxes, due to the ways that those make perfect sense as manifestations of general energy systems through the special cases of human systems, but that those realities then manifest their corollaries, that become deliberately ignored and misunderstood by most people, most of the time. Overall, the results of basing the political economy upon fundamentally fraudulent financial accounting systems, where governments ENFORCE FRAUDS by privately controlled banks, are that almost everyone enjoys proportional socioeconomic success within those systems by deliberately ignoring the principle of the conservation of energy as much as possible, while simultaneously deliberately misunderstanding the concept of entropy in the most absurdly backward ways possible.
Basically, our civilization lies to itself as much as it possibly can about what it is really doing. Therefore, the language that dominates the public spaces manages to lie by omission regarding the facts that "money" is being made out of nothing as debts, in order to "pay" for strip-mining the planet, which runs the gamut throughout all natural resources, which is currently the most important with respect to petroleum resources (WHICH IS WHAT THE AUDIO ABOVE DISCUSSES.)
At the 31 minute mark of that, Jeffrey Brown says:
Multiply that by billions of times, throughout every other area of human activities, and one arrives at that point: "If you do not want the answer to the question, then you tend to not ask that question." Our civilization manages to NOT think about how it is controlled by ENFORCING FRAUDS, and therefore, is able to NOT think about the relatively objective depletion of natural resources, approaching a range of diminishing returns. There are much deeper reasons for how and why that is the currently dominate sociopolitical situation, all of which tend to trace back to the death control systems, with the murder systems as the most extreme manifestations of that.
The intense paradoxes, or consistent contradictions, that arise from NOT continuing to deliberately ignore and misunderstand the human death control systems are that the genuine solutions to all of our problems are totally opposite to what we currently tend to deliberately misrepresent as much as possible. Namely, the real solutions to our real problems require radically different death control systems, in one way or another, sooner or later.
My basic flow of thoughts regarding these issues are:
Human beings live as entropic pumps of environmental energy flows. That follows from relatively SUBTRACTING human beings from their environment, which then means that they must take energy (including matter) across the boundaries that define them, which in basic English are acts of ROBBERIES. Human beings and civilizations necessary operate as systems of more or less organized lies operating robberies. All private property is based upon backing up claims with coercions, with the most abstract form of that being money is measurement backed by murder.
From the perspective of that flow of thoughts, of course, governments are the biggest forms of organized crime, controlled by the best organized gang of criminal, and so, the political economy is based upon governments ENFORCING FRAUDS by private banks. However, since everyone enjoys proportional social success by making "money" inside of that system, in ways which proportionately are based upon deliberately ignoring and misunderstanding what they are really doing as much as possible, the results are that the excessive successfulness of the established systems being based upon organized crime are that those systems become runaway criminal insanities.
Of course, those criminal insanities are most obvious when one thinks about how the political economy has become based on globalized electronic monkey money frauds, backed by the threat of force from apes with atomic bombs. However, those sorts of criminal insanities also reverberate and cascade in fractal patterns. By the time those get down to the level of the audio recording above, what we observe is the typical kinds of gross underestimations of the deeper nature of the problems, which goes along with gross over-estimations of what the "solutions" could be.
Chris Martenson is quite typical in the degree to which his world view is excessively based upon those sorts of presumptions that could be labeled as Hanlon's Razor. Namely, that since the lower level people in the social systems act like incompetent political idiots, therefore, the whole system operates that way. Since the core of organized crime that controls civilization tends to hide within its layers of controlled opposition, Chris Martenson, et alia, tend to also stay within the perspective of being too superficial, inasmuch as they too are mostly forms of controlled opposition, operating inside of the established systems, which they did not originally make, nor maintain, while what they mostly see around them are others in various layers of controlled opposition, whose behavior seems to be based upon them being incompetent political idiots.
Another way to present that are the ways that guys like Chris Martenson continue to take for granted that they are still living inside of systems where there is, relatively speaking, some significant rule of law. They do NOT have to actually defend their own property from marauders. They can still take for granted that there is a working government around them, that provides police and armed forces. Thus, they can also maintain attitudes which are too superficial, inasmuch as they do NOT have to take responsibility for the murder systems that back up the monetary systems, nor the coercions that back up their claims to private property.
As I said, the overarching situation is that Chris Martenson does not have to take seriously the issues that there are globalized electronic frauds, backed by the threat of atomic bombs. Rather, he can personally take for granted that there is the MAD Money As Debt system, backed by the MAD Mutual Assured Destruction system, within which he can take for granted his personal claims to private property being backed by coercions. He does NOT have to engage in his own personal murder system, backing up his own personal money system, but rather, can continue to mostly take those systems that he was born into for granted.
From an intellectual point of view, that means that he can stay with relatively superficial analyses, that presume upon applications of Hanlon's Razor. He does NOT have to think about the murder systems that back up the monetary systems. Rather, he can make a range of personal choices within the established systems. Hence, he can worry about the intersection of the problems with respect to the economy, energy and environment, without focusing on the most important features of the human ecology, inside of which is the political economy, which are the death control systems, with the murder systems as the most extreme manifestation of those.
The BIG PICTURE is that making "money" out of nothing as debts, in order to "pay" for strip-mining the planet actually "paid" for nothing. Rather, it was all based upon ENFORCING FRAUDS, as the result of socially successful organized crimes, whose excessively successfulness has become runaway criminal insanities. The DEEPER LOOK at that BIG PICTURE penetrates into the intensely paradoxical, consistent contradictions which are due to human beings necessarily living as entropic pumps of energy flows, which must match the principles and methods of organized crime, which were most socially successful to the degree that those could be operated by wolves who appeared in sheep's clothing, or by professional liars and immaculate hypocrites, cascading in fractal patterns through all levels of the social pyramid systems, in ways which resulted in society being almost totally dominated by the best professional liars and immaculate hypocrites, who tended to be lying about everything as much as possible, while simultaneously promoting bogus "solutions" to problems which were as absurdly backwards as possible.
I REPEAT, the most abstract ways that triumphant ENFORCED FRAUDS manifest are through people deliberately ignoring the principle of the conservation of energy as much as possible, while also deliberately misunderstanding the concept of entropy in the most absurdly backward ways possible. OF COURSE, those concerns apply more to petroleum resources, and the oil industries, than to anything else. The excessive successfulness of fundamentally fraudulent financial accounting systems has resulted in human beings developing basic concepts regarding "economics" which are the most absurdly backwards that those could possibly become.
The double whammy double binds that we are currently entangled in are due to the prolonged successfulness of wars based on deceits, and finance based on frauds. That history has driven us to develop petroleum resources in ways that have maximized wasting them, because we were never able to do anything better, because actually doing anything better would have required being able to operate better death controls to back up better debt controls, or to operate better coercions to back up private property claims.
It has been politically impossible to do that due to the overwhelming degree to which society is dominated by the best available professional liars and immaculate hypocrites. They had no reinforcement from better understanding how human energy systems really worked, but rather, they were more successful within society by continuing to deliberately ignore or misunderstand how those systems really worked as much as possible.
Of course, that is ubiquitously common throughout civilization, including in the content published on Zero Hedge. That the public money supply is based on governments ENFORCING FRAUDS by privately controlled banks is pervasively present everywhere, while the vast majority of people continue to take that for granted. There are consistent contradictions that manifest because people do not want to understand human beings as actually being entropic pumps of environmental energy flows, especially because that necessarily results in civilization operating according to the principles and methods of organized crime, because the human death controls are central to everything else, after there is human life.
In my opinion, whenever an article is republished on Zero Hedge that discusses the intersections between the economy and the environment, the comments published under that tend to routinely push cynicisms to the point of stupidities. Many of the comments published above already seem to have done that. Of course, that is understandable due to the intense paradoxes or consistent contradictions that arise between the relationships of civilization controlled by backing up lies with violence, or within a political economy based upon ENFORCING FRAUDS, actually operating within an environment where natural laws exist, and are somewhat understood by human beings, but mostly in distorted ways, due to the effects upon society that the triumphantly ENFORCED FRAUDS have.
It is extremely difficult to more fully integrate human energy systems with the economy and environment, due to the degree that human energy systems necessarily match the operation of the principles and methods of organized crime. Within that context, I praise Chris Martenson and Jeffrey Brown for asking and attempting to answer questions that most other people continue to not want to ask, because most other people still do NOT want the answers.
However, the audio recording above continues to take way too much for granted regarding how human civilization operates as an energy system. In general, that is the most abstract problem that human beings currently have, that there has been prodigious progress in the physical science of understanding general energy systems, BUT, that has not been allowed to happen within political science, since doing so would necessarily have to address the ways that the political economy is based upon ENFORCING FRAUDS, and that civilization necessarily operates through organized lies operating robberies, whereby frauds were symbolic robberies. Since there has been no progress in political science which has been allowed to integrate and surpass the progress achieved in physical science, we have the intense paradoxes of the industrial revolution developing petroleum resources in ways which laid waste to those as much as possible, as fast as possible, while fundamentally fraudulent financial accounting systems presented those as "good things" to do.
Of course, those behaviors were consistent contradictions, that derived from civilization necessarily operating according to the principles and methods of organized crime, which necessarily were the most socially successful by becoming based on the maximum possible bullshit surrounding what they were really doing. However, as the limits of diminishing returns from being able to continue to strip-mine that planet's natural resources become more difficult to deliberately ignore, more and more people are like Chris Martinson and Jeffery Brown, in becoming willing to ask questions that provide answers that most other people continue to NOT want to know.
Chris & Jeffery are collapse-a-tarians.
Chris is getting more and more stupid every day. I reached PEAK Chris.
I stpped listing to Chris year's ago. Once the peak oil agenda surfaced. Peak oil is similar to the driving 55 to save lives campaign.
http://www.drive55.org/html/safety.html
I can tell you that 80/mph highway is the magic number. You can shave off 15 to 20 minutes in arriving to final destination. You also save fuel by keeping vehicle in highest gearbox level. Henceforth, saving gas consumption. We just arrived back to HHI on Friday. I had a dirtbag in a Chevy Silverado drafting me in the right lane. I can only take that bullshit for so long.
Gave him the bye-bye wave. After you reach 110/mph, a Chevy's engine retarder will kick in and he'll never catch me. Needless to say, situation was defused.
We spend more gas consumption sitting at a light. Civil engineering departments love to fuck around with the traffic lights. They honestly think we are going to stop to spend money in their armpit of a city.
BMW has a nice feature, engine turns off at a traffic light. Engine fires up instantly once brake is released and accelerator is pressed.
my new 2015 MB c300 has this feature as well. still getting used to it.. kind of weird, but cool tech.
Oil is going up alright. Right before winter. And just a tad.
And then Q4 2015 dismal report, corporate revenue fall again.
AAPL new watch burned like the old one. So AAPL take down the entire tech index.
Consumer report dismal (el-nino is strongest this year. Will the "idiots media" blames El nino now?).
Shipping index crashing again. Crude inventories up.
And the crude FALLS (Again). I'm betting 32$. W/O crashing futures.
With crashing futures. That oil would be at least 26$ just for next year (same as i watch CNBC blinking oil intraday prices during the lowest point of 2008. Tough it did recover by end session). Got my gasoline at about 35 US cents/liters.
Yummy..
I see some bright posts on this topic, people that get it.
one bullet point I do not see mentioned though.. and is a big player in all of it.. financialization.
the parasite role that wall st / london has become. not so much generating and building capital for investment. thats over. today wall st / london is just a transaction parasite, pulling from top and bottom, needlessly.
P < P + I
It is diminishing returns that is killing us, not Peak Oil.
Peak Oil theory is valid, but it does not play out globally as expected. Also production is much more resilient than it was predicted.
Read Joseph Tainter to understand the whole thing.
The interesting thing about "diminishing returns" is how its all happening at once.
Make you believe in the Long Arm of God.
Or words to that effect.
As previously stated: Look at the trend on this chart of gasoline retail sales. http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=A103600001&f=M
Demand destruction becomes patently obvious once you look at the overall trend.
There is a lot of oil in the Monterey Shale formation. It was supposed to make us the next Saudi Arabia. The only problem is that 96 percent of it cannot be extracted under current conditions. http://www.latimes.com/business/la-fi-oil-20140521-story.html
Understand that the motivation to hype the next big find, thing or whatever is to no small extent driven by hucksters seeking investors. A lot of guys got paid in the oil patch for drilling dry holes. They got a pay check while the investors lost their shirts.
If you really want to understand the true course of oil, take the time to read the Bundeswehr Transformation Centre Future Analysis Branch’s estimation on the impact of diminishing oil production. When you come to realize that the final mitigation strategy recommended by the German Army comes down to everybody planting a garden you will finally grasp where this is headed. http://www.energybulletin.net/sites/default/files/Peak%20Oil_Study%20EN.pdf
The consequence of energy depletion and the end of growth is laid out by Dr. Tim Morgan in the Perfect Storm energy, finance and the end of growth.
http://ftalphaville.ft.com/files/2013/01/Perfect-Storm-LR.pdf
The ongoing collapse is readily apparent to anyone who will take the time to look. I don’t know about the rest of you, but I am doing everything I can to position me and mine for the inevitable localization of everything.
So how is your rocket ship coming along?
ZH - most thoughtful comments from a group in a very long time.
There is a rational case to Peak Oil Production, but there is also a stronger case for Peak Oil Demand.
Low cost PV and Wind are destroying fossil energy demand for electricity.
Electric cars are destroying gasoline demand.
Low cost PV and Wind are destroying fossil energy demand for electricity.
Electric cars are destroying gasoline demand.
Maybe they will eventually. But we ain't there yet.