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Csnavywx

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Re: Oil and Gas Issues
« Reply #200 on: December 25, 2014, 06:43:29 PM »

Quote
"It is not in the interest of OPEC producers to cut their production, whatever the price is. Whether it goes down to $20 a barrel...is irrelevant."

I really don't understand that way of thinking.  Is he saying that the non-OPEC producers won't cooperate with OPEC so there's no way to control supply and boost price?


http://www.reuters.com/article/2014/12/22/us-oil-prices-saudi-idUSKBN0JZ05W20141222

Quote
Kuwaiti Oil Minister Ali al-Omair said OPEC did not need to cut production and would not hold an emergency meeting ahead of its next scheduled talks in June.

"I don't think we need to cut. We gave a chance to others (and) they were not willing to do so," he said, referring to contacts with non-OPEC producers before OPEC's meeting in November in Vienna.

There, OPEC kept its target output of 30 million barrels per day (bpd) unchanged, leaving the market to balance itself without the group's intervention.

That stance was seen as a shift from a longstanding policy in which OPEC powerhouse Saudi Arabia has acted as a swing supplier.

Asked about possible cooperation between members of OPEC, which include the world's lowest-cost producers, and non-member countries, Naimi replied: "The best thing for everybody is to let the most efficient producers produce".

Another relevant quote:

Quote
He also said that OPEC's decision would ultimately help the world economy. "Current prices do not encourage investment in any form of energy, but they stimulate global economic growth, leading ultimately to an ‎increase in global demand and a slowdown in the growth of supplies," he said.



« Last Edit: December 25, 2014, 06:49:03 PM by Csnavywx »

Csnavywx

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Re: Oil and Gas Issues
« Reply #201 on: December 25, 2014, 06:57:45 PM »
So, my thinking is that the Saudis are playing the long game here (like they always have):

Cheap oil stimulates growth, increasing demand and drawing down excess spare capacity. It also diverts money away from new energy investment (including both fossil and renewable energy)  and back into the economy at large. In addition, more of the remaining investment money goes into enhancing extraction efficiency (through secondary and tertiary oil extraction) to reduce the cost of production. In other words, it prolongs the age of oil. The Saudis do not benefit in the long run if oil stays well above 100/barrel.

Edited for clarity.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #202 on: December 25, 2014, 09:38:29 PM »



Ignore the "Recent US conditions".  That is out of date.

Tesla is now paying Panasonic $180/kWh for their batteries.

TerryM

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Re: Oil and Gas Issues
« Reply #203 on: December 26, 2014, 08:12:01 AM »
 Perhaps he is saying that the OPEC partners shouldn't be expected to cut their production in order to keep prices high for the competition. If all players cut production by 10% this might be perceived as being more fair than asking OPEC to cut by 20% while everyone else pumps at capacity.
 As things stand high cost oil may simply close up shop & everyone will learn to live without tar-sands, shale, Arctic or deepwater production. I've heard that Russia is fine with cheap oil and a low Ruble but that Canada, Venezuela & American dreams of Oil Independence will crash hard.
 China's financial backing of Russia disrupts any dreams of "breaking" Russia as the Soviets were broken by Saudi/American oil price manipulation in the mid 80's. Saudi oil will continue to be priced and bought with American dollars, but Russian oil, extracted in Rubles and sold to BRICS in local currencies opens a new avenue for energy hungry nations to explore.
 Exported American gas can never compete with piped gas because of the huge costs of compressing/decompressing. The only markets available are island nations or those willing to sacrifice their competitiveness for ideological reasons. The EU did a quick about face re. South Stream, although that ship has probably already sailed, and those that believe they will willingly pay much more for American LNG than cheap Russian piped gas must believe that Merkel's phone calls contain some really explosive messages.
 Russia will have a few rough years while businesses pay off dollar debts, then, baring WWIII, the Sino-Russian century begins (as long as climate change doesn't toss over the chess board).
Terry

SATire

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Re: Oil and Gas Issues
« Reply #204 on: December 26, 2014, 02:17:19 PM »
Csnavywx, Terry and others,

to cite Saudi Arabia s Oil minister: "Naimi replied: "The best thing for everybody is to let the most efficient producers produce"".

And to conclude: They are teaching us reason and how the market goes. We should realize, that it is very stupid to destroy our nature and our water sources by extremely expensive and dirty sources like tar sands and shale gas/oil. So we are taught the hard way to keep the dirty expensive stuff where it is and to use the easy cheap oil for the rest of the "oil-age". How much oil are we allowed to burn to reach e.g. the 2°C limit? Do we need more than the easy oil for that? So we should appreciate Saudis lesson and stop wasting our planet for nothing.

Stop let us stop blowing bubble after bubble and concentrate on the real things.

And I do not think that a "Sino-Russian century begins" but the oil-century will end. And most regions will increase their share on cost of the few regions, which took a to big share in the past. No problem to learn de-growth in the most developed countries first - we will not starve.

But the big risk is, that the cheap oil will boost some bubble-growth again: If people spend the saved money to consume more things and thus drive us in more problems. That money must be spend for lasting goods and not in bubble-consumption again.

Sigmetnow

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Re: Oil and Gas Issues
« Reply #205 on: December 26, 2014, 03:55:33 PM »

Quote
"It is not in the interest of OPEC producers to cut their production, whatever the price is. Whether it goes down to $20 a barrel...is irrelevant."

I really don't understand that way of thinking.  Is he saying that the non-OPEC producers won't cooperate with OPEC so there's no way to control supply and boost price?

If you have enough money –– and the Saudis have billions of dollars set aside in savings –– price is no longer of any consequence.  Just as the higher cost of that new project they're building is no longer important, the lower profit of their day-to-day business doesn't matter, either.  High or low, cost or profit, they will simply do as they like, while the cost to others is of no concern to them.  Obscene wealth has obscene "privileges".
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #206 on: December 26, 2014, 09:42:38 PM »
Analyst:  we're in new territory, with no (OPEC) oil cartel to control price or supply.  She doesn't see oil prices rebounding within the next 18 months.  7min video.
http://www.bloomberg.com/video/oil-market-gianna-bern-on-prices-m-a-opec-S0cQ~92MTNSwV6645FFQEg.html
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Bob Wallace

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Re: Oil and Gas Issues
« Reply #207 on: December 26, 2014, 11:19:51 PM »
If the Saudi goal is to create a new "OPEC" we could easily see higher oil prices in a few months.

All the Saudis need to do is to convince most of the other producers to agree to limit production.  They aren't likely to get 100% compliance but the countries least likely to cooperate can't supply even half of demand.  Countries like Venezuela will likely prefer to sell some oil at a high price rather than to sell no oil at all.

I suspect agreements won't be as public this time around. 

Sigmetnow

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Re: Oil and Gas Issues
« Reply #208 on: December 27, 2014, 02:51:48 AM »
If the Saudi goal is to create a new "OPEC" we could easily see higher oil prices in a few months.

All the Saudis need to do is to convince most of the other producers to agree to limit production.  They aren't likely to get 100% compliance but the countries least likely to cooperate can't supply even half of demand.  Countries like Venezuela will likely prefer to sell some oil at a high price rather than to sell no oil at all.

I suspect agreements won't be as public this time around.
The oil cartel era is dead, and Saudi Arabia has no plans to restart it.  Here's how they will deal with the new reality:
"Saudi Rulers to Curb Wages as Kingdom Confronts Oil Slump"
http://www.bloomberg.com/news/2014-12-25/saudi-arabia-sees-wider-2015-budget-deficit-as-oil-prices-plunge.html
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Csnavywx

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Re: Oil and Gas Issues
« Reply #209 on: December 27, 2014, 04:44:39 AM »
I think we're overthinking this a bit. Hell, I even posted on the geopolitical angle, but I'm thinking that was a bit of an over-analyzation by me.

The root cause:
1) Prolonged high prices gave rise to large spare capacity.
2) G-20 nations, most of which are net importers, are almost all experiencing recessions (or soon-to-be recessions) which is suppressing demand. The US is an exception at the moment.

A low oil price WILL boost growth and demand over time, eventually eating into that spare capacity. I think we're already starting to see an increase in the US based on EIA consumption and "product supplied" data, but we will need a couple more months to confirm the trend. Thing is, prices have been so high for so long, that there's now a large number of wells that can come back online as soon as the price rises enough for them to become profitable. It might be a long time before we see high prices again.

That's not exactly great news for the climate of course, but it is what it is. Most people don't think beyond their next paycheck nowadays, so a low gas price is likely to translate into increased spending on consumer goods.

JimD

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We do not err because truth is difficult to see. It is visible at a glance. We err because this is more comfortable. Alexander Solzhenitsyn

How is it conceivable that all our technological progress - our very civilization - is like the axe in the hand of the pathological criminal? Albert Einstein

JimD

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Re: Oil and Gas Issues
« Reply #211 on: December 28, 2014, 04:31:06 PM »
Shared Humanity (if you are around any longer you will find this interesting I bet)

I would be interested in your thoughts on the below.

http://blogs.lse.ac.uk/usappblog/2014/05/15/profit-from-crisis-why-capitalists-do-not-want-recovery-and-what-that-means-for-america/

Quote
...............

So what do these facts mean for America?

First, they make the fault-lines obvious. The old slogan “what’s good for GM is good for America” now rings hollow. Capitalists seek not utility through consumption but more power through redistribution. And they achieve their goal not by raising investment and fueling growth, but by allowing unemployment to rise and jobs to become scarce. Clearly, we are not “all in the same boat.” There is a distributional struggle for power, and this struggle is not a mere “sociological” issue. It is the center of our political economy, and we need a new theoretical framework to understand it.

Second, macroeconomic policy, whether old or new, cannot offset the aggregate consequences of this distributional struggle. Not by a long shot. Till the late 1970s, the budget deficit was small, yet America boomed. And why? Because progressive taxation, transfer payments and social programs made the distribution of income less unequal. By the early 1980s, this relationship inverted. Although the budget deficit ballooned and interest rates fell, economic growth decelerated. New methods of upward redistribution have caused the share of the Top 1 percent to zoom, making stagnation the new norm.

Third, and finally, Washington can no longer hide behind the bush. On the one hand, the concentration of America’s income and assets, having been boosted by large post-crisis bailouts and massive quantitative easing, is now at record levels. On the other hand, long-term unemployment remains at post-war highs while job growth is at a standstill. Eventually, this situation will be reversed. The only question is whether it will be reversed through a new policy trajectory or through the calamity of systemic crisis.
We do not err because truth is difficult to see. It is visible at a glance. We err because this is more comfortable. Alexander Solzhenitsyn

How is it conceivable that all our technological progress - our very civilization - is like the axe in the hand of the pathological criminal? Albert Einstein

Sigmetnow

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Re: Oil and Gas Issues
« Reply #212 on: December 29, 2014, 05:54:40 PM »
People who say it cannot be done should not interrupt those who are doing it.

Bob Wallace

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Re: Oil and Gas Issues
« Reply #213 on: December 29, 2014, 09:40:21 PM »
Texans Discover Oil Grows on Olive Trees as Crude Drops
http://www.bloomberg.com/news/2014-12-29/texans-discover-oil-growing-on-olive-trees-as-crude-drop-deepens.html

"estimates put the life of his wells in the range of 15 to 50 years.

Olive orchards, he says, can fruit for up to 25 years"

Perhaps he should install solar panels.  Give up this short term stuff....   ;)

jai mitchell

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Re: Oil and Gas Issues
« Reply #214 on: December 29, 2014, 11:15:38 PM »


The current difficulty is the cost of entry into the market and the regulatory hurdles that prevent a private supplier to avoid the necessary offsets of stranded costs due to utility expenses in the generation/distribution mix.
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Bob Wallace

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Re: Oil and Gas Issues
« Reply #215 on: December 30, 2014, 12:31:29 AM »


The current difficulty is the cost of entry into the market and the regulatory hurdles that prevent a private supplier to avoid the necessary offsets of stranded costs due to utility expenses in the generation/distribution mix.

I don't know what you're trying to say.

Laurent

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Re: Oil and Gas Issues
« Reply #216 on: December 30, 2014, 11:35:28 AM »
North Sea oil industry 'close to collapse'
http://www.bbc.com/news/business-30525539

JimD

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Re: Oil and Gas Issues
« Reply #217 on: December 30, 2014, 04:39:20 PM »
Oil Near Lowest Since ’09 With Supply at Year-End Record

http://www.bloomberg.com/news/2014-12-30/oil-trades-near-5-year-low-as-opec-strategy-seen-worsening-glut.html

Quote
Oil traded near the lowest since 2009 amid speculation that U.S. crude inventories will stay at the highest for the time of year in at least three decades.

West Texas Intermediate fell as much as 1.7 percent before erasing losses. U.S. stockpiles are projected to remain at 387.2 million barrels last week, the highest for the period in data going back to 1982, a Bloomberg News survey shows before government data tomorrow. U.S. oil drillers last week idled the most rigs since 2012, Baker Hughes Inc. said on its website yesterday.......

We do not err because truth is difficult to see. It is visible at a glance. We err because this is more comfortable. Alexander Solzhenitsyn

How is it conceivable that all our technological progress - our very civilization - is like the axe in the hand of the pathological criminal? Albert Einstein

Sigmetnow

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Re: Oil and Gas Issues
« Reply #218 on: December 30, 2014, 10:07:47 PM »
Greenspan: Structure of the Oil Market Has Changed; can't estimate future prices until business cutbacks are complete.  3 min video.
http://www.bloomberg.com/video/greenspan-structure-of-the-oil-market-has-changed-0TsSP3HnROeuUpBLUGaKoQ.html
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Laurent

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Re: Oil and Gas Issues
« Reply #219 on: December 31, 2014, 10:15:33 AM »

Sigmetnow

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Re: Oil and Gas Issues
« Reply #220 on: January 01, 2015, 03:14:36 AM »
Quote
Oil took another hit Wednesday, sinking below $53 to a level last seen during the Great Recession.
...
"If this doesn't hold, we could go back to price levels in late 2008 and early 2009 -- down in the $30s. There's no reason why it couldn't happen," said Darin Newsom, senior analyst at Telvent DTN.
Quote
One key difference between then and now is how much oil has grown as an asset class for investors.

That could increase the chances of a downward spiral as investors panic and dump their holdings, said Tom Kloza, global head of energy analysis at the Oil Price Information Service.
http://money.cnn.com/2014/12/31/investing/crude-oil-52-dollars-even-lower/index.html
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JimD

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Re: Oil and Gas Issues
« Reply #221 on: January 01, 2015, 06:12:33 PM »
http://wolfstreet.com/2014/12/30/oil-bust-contagion-hits-hedge-funds-supplier-layoffs-begin/

Quote
Just how bad is it in Canada? Baker Hughes’ latest rig count, released on Monday, shows that US drillers reduced their rigs that are drilling for oil by 37, to 1,499, while increasing gas rigs by 2 to 340. But in Canada, oil rigs plunged by half from 190 to 94; and gas rigs dropped by 19% from 201 to 162. The Canadians aren’t dilly-dallying around. According to Civeo, tar-sands operators have been just as aggressive as drillers in cutting operating costs and capital expenditures.

Going into 2015, Civeo has about 35% to 40% of its lodge rooms contracted in Canada, “down from over 75%” a year ago. That’s down by about half!

In an all-out effort to cut its operating costs, it has been slashing headcount, in its Canadian operations by 30% and in its US operations by 45%. It’s closing facilities and is going after capital expenditures with a big axe, chopping them from $260-$280 million in 2014 to $75-$80 million for 2015. That would amount to a cut of about 70%!
We do not err because truth is difficult to see. It is visible at a glance. We err because this is more comfortable. Alexander Solzhenitsyn

How is it conceivable that all our technological progress - our very civilization - is like the axe in the hand of the pathological criminal? Albert Einstein

TerryM

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Re: Oil and Gas Issues
« Reply #222 on: January 02, 2015, 08:16:50 PM »
Chevron quits Canadian Arctic!!


http://www.businessinsider.com/r-chevron-cancels-canadian-arctic-drilling-as-oil-prices-slide-2014-12


In 1986 oil was dropped to $10.00 to break the Soviets. Russia, with China's backing won't fail but the attempt may extend for a long time.


Terry

Bob Wallace

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Re: Oil and Gas Issues
« Reply #223 on: January 02, 2015, 08:21:33 PM »
China might demand its pound of flesh from Russia in exchange for support.

China might, for example, insist that Russia start working on its GHG emissions problem. 

JimD

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Re: Oil and Gas Issues
« Reply #224 on: January 03, 2015, 05:23:17 PM »
Chevron quits Canadian Arctic!!


http://www.businessinsider.com/r-chevron-cancels-canadian-arctic-drilling-as-oil-prices-slide-2014-12


In 1986 oil was dropped to $10.00 to break the Soviets. Russia, with China's backing won't fail but the attempt may extend for a long time.


Terry

Right from my Triage list!  As long as there are low prices and  a significant chance of their continuing for a period of time any deep water or arctic drilling is just financial stupidity.  I would expect that all such activities will see big delays instituted while the big players assess the situation.

We do not err because truth is difficult to see. It is visible at a glance. We err because this is more comfortable. Alexander Solzhenitsyn

How is it conceivable that all our technological progress - our very civilization - is like the axe in the hand of the pathological criminal? Albert Einstein

sidd

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Re: Oil and Gas Issues
« Reply #225 on: January 03, 2015, 09:34:05 PM »
For hose interested in the mechanics of the oil market ripoff, see the latest by chris cook over at eurotrib, and his earlier work.

sidd

TerryM

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Re: Oil and Gas Issues
« Reply #226 on: January 03, 2015, 11:32:05 PM »
For those of us that did (or didn't) follow Shell's disastrous Arctic adventures, a marvelous NYT article covering the Kulluk's demise.


http://www.nytimes.com/2015/01/04/magazine/the-wreck-of-the-kulluk.html?_r=0


It reads like "The Perfect Storm". The scariest thing is that Shell was prepared to try it again but for the crash in oil prices.


Terry

Laurent

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Re: Oil and Gas Issues
« Reply #227 on: January 04, 2015, 02:53:55 PM »

Sigmetnow

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Re: Oil and Gas Issues
« Reply #228 on: January 05, 2015, 01:57:46 AM »
Alberta economy feels the emptyness as oil companies shed workers in response to low oil prices.
Quote
Mr. Yager called predictions in October from the two main oilfield services industry associations, the Petroleum Services Association of Canada and the Canadian Association of Oilwell Drilling Contractors, of a 10% decline in oilfield activity in 2015 “hopelessly optimistic.”

“They were both predicated on $85 oil — as of today, we’re 30-bucks-a-barrel short,” Mr. Yager said of the forecasts. A sharp reduction in oilfield service activity is expected, Mr. Yager said, unless drilling, fracking, tubing and other companies can reduce their costs.
http://business.financialpost.com/2015/01/03/layoffs-loom-in-albertas-oil-patch/
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #229 on: January 05, 2015, 05:21:05 PM »
Starting the global fuel-subsidy dump!

Indonesia slashes $18 billion from its fuel subsidy system, doubles spending on transportation, agriculture and public works.
http://www.bloomberg.com/news/2015-01-05/indonesia-doubling-transport-budget-with-10-billion-fuel-saving.html
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JimD

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Re: Oil and Gas Issues
« Reply #230 on: January 05, 2015, 05:28:04 PM »
Below you will find the best article I have found on the world's current energy situation.  It is focused on oil and natural gas but also covers renewables on the macro level .  With only minor exceptions it states exactly what I have been trying to point out for some time.  Since it is an interviews with Arthur Berman you will get a much clearer explanation than I have been able to provide.  He is, after all, one of the world deepest experts on the subject so it would be sad if I was better at it than him.

Quote
....
OP: How do you see the shale landscape changing in the U.S. given the current oil price slump?

Arthur Berman: We’ve read a lot of silly articles since oil prices started falling about how U.S. shale plays can break-even at whatever the latest, lowest price of oil happens to be. Doesn’t anyone realize that the investment banks that do the research behind these articles have a vested interest in making people believe that the companies they’ve put billions of dollars into won’t go broke because prices have fallen? This is total propaganda.....

Quote
....Continental Resources is the biggest player in the Bakken. Their free cash flow—cash from operating activities minus capital expenditures—was -$1.1 billion in the third- quarter of 2014. That means that they spent more than $1 billion more than they made. Their debt was 120% of equity. That means that if they sold everything they own, they couldn’t pay off all their debt. That was at $93 oil prices.

And they say that they will be fine at $60 oil prices? Are you kidding?......

....U.S. refineries can’t handle the light oil and condensate from the shale plays so it has to be blended with heavier imported crudes and exported as refined products. Domestic producers could make more money faster if they could just export the light oil without going to all of the trouble to blend and refine it.

This, by the way, is the heart of the Keystone XL pipeline debate. We’re not planning to use the oil domestically but will blend that heavy oil with condensate from shale plays, refine it and export petroleum products. Keystone is about feedstock......

Quote
...Many people think that the resurgence of U.S. oil production shows that Peak Oil was wrong. Peak oil doesn’t mean that we are running out of oil. It simply means that once conventional oil production begins to decline, future supply will have to come from more difficult sources that will be more expensive or of lower quality or both. This means production from deep water, shale and heavy oil. It seems to me that Peak Oil predictions are right on track....

Quote
...Technology will not reduce the break-even price of oil. The cost of technology requires high oil prices. ..

The price of oil will recover. ...

Only a global economic collapse would permit low oil prices to persist for very long...

And this may be just what we are going to get...a serious global economic slowdown.  Not a collapse but the effect will be the same in terms of holding oil prices down.  If this happens and even if the low prices only last a year or so it will have very negative effects on any efforts to overhaul the current infrastructure to the green BAU infrastructure.  Finances and politics cannot be ignored.

Quote
OP: How do you see the global energy mix changing in the coming decades? Have renewables made enough advances to properly compete with fossil fuels or is that still a long way off?

Arthur Berman: The global energy mix will move increasingly to natural gas and more slowly to renewable energy. Global conventional oil production peaked in 2005-2008. U.S. shale gas production will peak in the next 5 to 7 years but Russia, Iran, Qatar and Turkmenistan have sufficient conventional gas reserves to supply Europe and Asia for several decades. Huge discoveries have been made in the greater Indian Ocean region—Madagascar, offshore India, the Northwest Shelf of Australia and Papua New Guinea. These will provide the world with natural gas for several more decades. Other large finds have been made in the eastern Mediterranean....

Quote
...Of course, natural gas and renewable energy go hand-in-hand. Since renewable energy—primarily solar and wind—are intermittent, natural gas backup or base-load is necessary. I think that extreme views on either side of the renewable energy issue will have to moderate. On the one hand, renewable advocates are unrealistic about how quickly and easily the world can get off of fossil fuels. On the other hand, fossil fuel advocates ignore the fact that government is already on board with renewables and that, despite the economic issues that they raise, renewables are going to move forward albeit at considerable cost.

Time is rarely considered adequately. Renewable energy accounts for a little more than 2% of U.S. total energy consumption. No matter how much people want to replace fossil fuel with renewable energy, we cannot go from 2% to 20% or 30% in less than a decade no matter how aggressively we support or even mandate its use. In order to get to 50% or more of primary energy supply from renewable sources it will take decades....

Decades.  Exactly what I have been saying and exactly why large scale renewables are NOT a rational approach to preventing the worst effects of climate change. 

Quote
I appreciate the urgency felt by those concerned with climate change. I think, however, that those who advocate a more-or-less immediate abandonment of fossil fuels fail to understand how a rapid transition might affect the quality of life and the global economy.

Here we strongly diverge.  Berman clearly states the time required to transition.  It is far too long and amounts to business as usual.  Thus his focus on how a rapid transition will effect the quality of life and the global economy.  But since he has not really studied climate change and carrying capacity issues he fails to realize that his timeline of decades is the path to catastrophic collapse.  If we do not abandon BAU approaches now we will make the collapse process immeasurably worse.

In any case a very good read.

http://oilprice.com/Interviews/The-Real-Cause-Of-Low-Oil-Prices-Interview-With-Arthur-Berman.html
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #231 on: January 05, 2015, 05:39:37 PM »
Methinks their luck will not be as golden this time.

Canada’s Richest Grain Family Betting on Rebound in Oil
http://www.bloomberg.com/news/2015-01-04/canada-s-richest-grain-family-betting-on-rebound-in-oil.html
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #232 on: January 06, 2015, 05:12:28 AM »
We warned you about stranded assets!
Quote
With crude prices down more than 50 percent from their 2014 peak, fields as far-flung as Kazakhstan and Australia are no longer worth pumping, said a team of Citigroup Inc. (C) analysts led by Alastair Syme. Companies on the hook for risky, high-cost projects that don’t make sense in a $50-a-barrel market include international titans such as Royal Dutch Shell Plc (RDSA) and small wildcatters like Sanchez Energy Corp.
Quote
Exposing Risk

The oil-market rout is exposing projects dating as far back as 2009 that were either poorly executed or bad ideas to begin with, Syme’s team said in a note to clients. Shell, Europe’s largest energy producer, may have as much as 5 percent of its capital tied up in money-losing projects. For U.K.-based BG Group Plc (BG/), the figure could be as high as 8 percent, according to the Citi analysts.
http://www.bloomberg.com/news/2015-01-05/oilfield-writedowns-loom-as-market-collapse-guts-drilling-values.html
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Laurent

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Re: Oil and Gas Issues
« Reply #233 on: January 06, 2015, 10:52:59 AM »

Laurent

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Re: Oil and Gas Issues
« Reply #234 on: January 06, 2015, 11:18:08 AM »

Sigmetnow

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Re: Oil and Gas Issues
« Reply #235 on: January 06, 2015, 12:59:06 PM »
Infrared cameras tuned to specific frequencies can detect methane emissions cheaply and at a distance.  Many leaks are cost effective to fix.  And "Neighborhood watches" for methane around oil and gas installations are now possible.
http://dotearth.blogs.nytimes.com/2015/01/05/two-ways-infrared-cameras-have-boosted-the-case-for-e-p-a-rules-cutting-methane-leaks/
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Laurent

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Re: Oil and Gas Issues
« Reply #236 on: January 06, 2015, 05:40:17 PM »
Commodity boom extracting increasingly heavy toll on Amazon forests
http://www.theguardian.com/environment/2015/jan/06/commodities-latin-america-amazon-deforestation

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But the recent slump in oil prices leaves Ecuador owing more and more crude to China, creating new pressure for the government to expand the drilling frontier in the Amazon.

Laurent

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Re: Oil and Gas Issues
« Reply #237 on: January 06, 2015, 05:42:18 PM »

Sigmetnow

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Re: Oil and Gas Issues
« Reply #238 on: January 06, 2015, 07:19:59 PM »
Keep your seatbelts fastened!  ;-)  Oil below $50 a barrel and the Saudis aren't blinking.

Quote
West Texas Intermediate for February delivery dropped 98 cents, or 2 percent, to $49.06 a barrel at 10:06 a.m. on the New York Mercantile Exchange after touching $48.47, the lowest since April 2009.
...
U.S. crude inventories probably increased to 386.2 million barrels in the week ended Jan. 2.... Inventories of crude and gasoline were at their highest seasonal level since EIA weekly data started.
...
Saudi Arabia, the biggest OPEC producer, will keep a “solid will” and maintain the nation’s stability even with falling crude prices, King Abdullah said today in a speech read by his crown prince.
...
Production may expand from fields in West Africa, Latin America, the U.S. and Canada in addition to increased supplies from Russia and Iraq, Morgan Stanley said yesterday in a report. Iran may boost overseas exports by about 500,000 barrels a day if international sanctions are lifted, the bank said.
http://www.bloomberg.com/news/2015-01-06/crude-holds-slump-to-50-as-global-supply-glut-seen-persisting.html

Edit:  update: WTI (Light Sweet Crude Oil) closed at $47.93
« Last Edit: January 07, 2015, 12:31:47 AM by Sigmetnow »
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Laurent

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Re: Oil and Gas Issues
« Reply #239 on: January 06, 2015, 11:20:03 PM »

bluesky

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Re: Oil and Gas Issues
« Reply #240 on: January 06, 2015, 11:38:40 PM »
Is Saudi Arabia attempting to kill US shale gas industry and delay breakthrough in electrical car/ electrical battery autonomy?

jai mitchell

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Re: Oil and Gas Issues
« Reply #241 on: January 07, 2015, 12:41:58 AM »
Is Saudi Arabia attempting to kill US shale gas industry and delay breakthrough in electrical car/ electrical battery autonomy?


very interesting,

I wonder, how could the Saudi's kill the U.S. Shale *gas* industry with oil exports?

why do we still call it a shale "gas" extraction process. 

Could it be that if the public realized that the value of the oil produced in the Shale production expansion was 300% of the value of the gas sold that they would realize that massive increases of domestic oil production did nothing to cause prices to decline over these last 5 years?


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Sigmetnow

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Re: Oil and Gas Issues
« Reply #242 on: January 07, 2015, 01:03:28 AM »
Is Saudi Arabia attempting to kill US shale gas industry and delay breakthrough in electrical car/ electrical battery autonomy?
My impression is that they are simply trying to get as much money as they can, from as much oil as they can sell right now, because they see the days for oil are numbered.  They know the transition will be very difficult for them -- but they really don't care what it will do to other countries.  They have suggested that other countries should decrease their own output, if countries want to lower oil supply and thus raise oil prices.

Low oil prices will tend to shut down expensive oil acquisition processes, like fracking, which will help the Saudis in the short run, but I don't think that's their primary goal.  Electric cars and battery technology will still go ahead -- California, for example, is pushing them -- despite perhaps at a bit slower pace briefly, due to lower gas prices.  (Watch for carbon taxes/fees to be instituted during this time, increasing gas prices somewhat.)

People who have electric cars love them, and the best marketing tool is just talking to an owner in the parking lot....  With EV range going up and price going down, the market will continue to grow.  At some point, gas prices will rocket up again, and people tired of the oil game will see the advantages in the many no-gas alternatives the next time they shop for a new car.
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jai mitchell

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Re: Oil and Gas Issues
« Reply #243 on: January 07, 2015, 01:23:41 AM »
http://www.nasdaq.com/article/ford-chief-says-massmarket-autonomous-vehicle-is-priority-20150106-01238
Ford Chief Says Mass-Market Autonomous Vehicle Is Priority

Quote
"We believe in the industry that there will be a fully autonomous vehicle, probably within the next five years," Mr. Fields said. "Unlike our luxury competitors, when we do come out with an autonomous vehicle, we want to make sure it is accessible and affordable to everyone."

This will time perfectly with the <$30,000, 400 mile tesla and continued massive solar buildouts.

within 10 years the majority of U.S. urban transport will be self-driving EVs that charge while driving during the day.
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AbruptSLR

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Re: Oil and Gas Issues
« Reply #244 on: January 07, 2015, 02:05:19 AM »
Exxon provides the following energy distribution and anthropogenic CO2 emission estimates:

http://www.energyglobal.com/downstream/refining/06012015/Carbon-dioxide-emissions-forecast-025/
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #245 on: January 07, 2015, 02:10:51 AM »
People who say it cannot be done should not interrupt those who are doing it.

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Re: Oil and Gas Issues
« Reply #246 on: January 07, 2015, 02:22:10 AM »
Exxon provides the following energy distribution and anthropogenic CO2 emission estimates:

http://www.energyglobal.com/downstream/refining/06012015/Carbon-dioxide-emissions-forecast-025/

from the report
Quote
Exxon expects global energy related CO2 emissions to increase by approximately 25% from 2010 to 2030 and then to decline approximately 5% to 2040.

In other related news, the Exxon board of directors, executives and related staff committed mass suicide this morning.  Leaving a signed note:

Quote
At these rates global society will completely collapse by 2045 with billions of lives lost.  We just felt too damned responsible.
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TerryM

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Re: Oil and Gas Issues
« Reply #247 on: January 07, 2015, 02:35:48 AM »
Oil is crashing to crush the Russian economy. The last time this was done was in 1986 when the USSR went belly up after oil dropped to < $10.00 ($21.30 in 2015 $), per barrel. Oil stayed low for over a decade.
While low prices are hurting all producing nations, Russia, especially after the announcement of China's support, will not be brought down. The damage to Canada, Netherlands and other friendlies reliant on oil exports is substantial, & financing costs to American shale oil plays will cripple the America's largest growth industry.
Re-using yesterday's weapons to win today's economic wars probably won't succeed & may cause far more "friendly fire" damage.
European's are on the front lines of a dispute that leaves them gasping for the cheap energy that has fueled their growth. South Stream, which would have provided a reliable source of inexpensive gas, is dead. The projected LNG shipments from the US would always have been much higher priced than the piped alternative. With shale projects far underwater at these prices & depletion rates far higher than expected, it may be decades before the LNG shipments proceed. It's not impossible that American/Canadian LNG exports may simply have missed the boat and that Europe will be left paying for America's belligerency.
Terry

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Re: Oil and Gas Issues
« Reply #248 on: January 07, 2015, 09:43:55 AM »
Is Saudi Arabia attempting to kill US shale gas industry and delay breakthrough in electrical car/ electrical battery autonomy?
bluesky, Naimi explained us (link above), that they like to kill not only US shale gas but all inefficient producers (also tar sand, deep water and/or arctic drilling). That seems to be the typical behaviour of any market player to get more market share of the rest of the oil market left due to future global warming restrictions.

I guess the electrical battery breakthrough is independend of the oil price since that depends on political will and regulations like in CA or Norway or actions in China - I do not think that people in Arabia see any chance to change politics elsewhere. Sometimes US leader may have such dreams but that never worked anywhere as you know.

To cite Saudi Arabia's Oil minister again: "Naimi replied: "The best thing for everybody is to let the most efficient producers produce""

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Re: Oil and Gas Issues
« Reply #249 on: January 07, 2015, 04:55:22 PM »
People are way over thinking this by wandering off into all the speculation about some Saudi machinations in global strategy and tactics.

Saudi has only two main concerns.

Number One is the free market capitalist concern.  Drive out the high cost producer in order to make the most money long term by controlling the market.  There is no ideological requirement to be nice or fair about it.  Crush your opponents as fast as you can.  It is the John D. Rockefeller methodology.  If you are a card carrying member of the free market capitalist ideology you should be in serious admiration of what the Saudi's are doing.

Their second concern is their rivalry with Shia Islam.  It is their only sovereign threat.  Thus their support for ISIS.  That slamming the oil market up side the head with the reality of where the market sits right now serves that purpose as well is icing on the cake.
We do not err because truth is difficult to see. It is visible at a glance. We err because this is more comfortable. Alexander Solzhenitsyn

How is it conceivable that all our technological progress - our very civilization - is like the axe in the hand of the pathological criminal? Albert Einstein