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***Countdown to $100 oil (28) - New records suggest more to come

by Jerome a Paris
Tue Jul 18th, 2006 at 08:11:26 AM EST

No, I'm not talking about the new highs reached by oil prices ($78.40 for WTI in New York, $78.66 for Brent in London) - these would not have been enough to take me out of my holiday. I'm not even talking about whatever's happening in the eastern Mediterranean basin - war and hate in that region are part of the scenery and mostly irrelevant to oil prices (in fact, they are a great distraction from oil-related news). No, I'm talking about two other records that have come along and suggest without a doubt that we are fucked.

***back from the front page...

One is known to the markets and directly impacted oil prices:

US demand growth remains firm
"The initial reading on June gasoline demand is now put at 9.506m b/d, which is the first time that monthly demand has ever surpassed 9.5m b/d"

So, despite record high oil (and gasoline) prices, US demand for gasoline is still growing more than ever. With demand growing at record paces in countries like China, India, Iran or Saudi Arabia, and production stagnant, you'd expect the higher oil prices to at least have on rich world demand. Many parts of Europe did see demand reduction, as drivers used thir cars less and switched to more fuel efficient vehicles, but in the US - nope. Individual efforts have not yet been enough to beat the huge inertia of the system.

Which means that prices will have to go much higher to actually have an impact on US demand.

The second record is the one that inspired me to write this diary - it's a strong contender for the title of stupidest newspaper headline, found in the local paper here in Sydney.

As you may have heard, an Australian TV channel recently broadcasted a high profile documentary on peak oil. A well known Iranian peak oil expert is currently in Australia, and he spoke at a conference:

"In the near future there is no way to go but on the decline," he said. "[Consumption] will decline to 55 million barrels by 2020" from a peak of 81 million barrels this year. In the mid-1990s the only unexplored frontiers were the poles, but now energy companies were moving into the Arctic. "There is only one frontier left and that is Antarctica," Dr Bakhtiari said.

Dr Bakhtiari is a well known voice in peak oil circles, especially for his willingness to contest official OPEC reserve numbers, and he is one of the most pessimistic as to the date of peak oil.

So you'd expect the paper to notice that pessimism, maybe? Nope. Here's their glorious headline (for a small half-column article):

Antarctic next, says oil expert

We'll just keep on producing more and go the the next available spot. Nothing to worry, move along...

It's not with headlines like this one that peak oil is going to enter our collective consciousness and that politicians will be moved to do anything. Blaming Iran, Palestinians, speculators, the imperialist Russians or the greedy Chinese is sooo much easier...

$100 oil will happen this year and it will be an anti-climax.

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***Countdown to $100 oil (28) - New records suggest more to come | 25 comments (25 topical, 0 editorial, 0 hidden)

Temporarily out of lurkerdom (4.00 / 4)

on Bastille Day (or the next? - I am a bit confused by time zones right now)

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (jeromeguillet@yahoo.fr) on Fri Jul 14th, 2006 at 10:37:10 AM EST

Re: Temporarily out of lurkerdom (none / 0)

Your "Time to bet again (ET)" link is bad.

Nothing is 'mere'. — Richard P. Feynman

by Migeru (migeru at eurotrib dot com) on Fri Jul 14th, 2006 at 10:42:44 AM EST
[ Parent ]

Thanks (none / 0)

Now corrected

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (jeromeguillet@yahoo.fr) on Fri Jul 14th, 2006 at 11:14:34 AM EST
[ Parent ]

Re: Countdown to $100 oil (28) (4.00 / 3)

For God's sake, Jerome, go out and look at all the wildlife. You're in a country that has Great White Sharks, Box Jellyfish, Kangaroos, and, of course, Australians.

Where's your motherf*%&ing flag pin?

by Drew J Jones (blahblahblah@blahblahblah.com) on Fri Jul 14th, 2006 at 11:04:55 AM EST

will do (none / 1)

but today we got up at 2pm and nightime is at 5pm (winter here...)

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (jeromeguillet@yahoo.fr) on Fri Jul 14th, 2006 at 11:11:25 AM EST
[ Parent ]

Re: will do (none / 0)

Where in Oz are you, BTW?

*Traitor*, n.
A benighted individual who perceives an illusory distinction between serving his nation and abetting the criminals who govern it.

by DoDo on Fri Jul 14th, 2006 at 11:18:46 AM EST
[ Parent ]

Sydney now (none / 0)

then the next few weeks up on the Coast, then onto Ayers Rock.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (jeromeguillet@yahoo.fr) on Fri Jul 14th, 2006 at 11:37:12 AM EST
[ Parent ]

Re: Sydney now (none / 0)

Intriguing name. I had to look it up.

Ooh, nice.

Ayers Rock

Sacred place, Uluru. Interesting satellite picture at bottom of page

Uluru [wikipedia]

Beautiful Google maps image

_____

Oh, my. Have a lovely time!

[down there where you can look up our Northern hemispheric petticoats]

by cigonia on Fri Jul 14th, 2006 at 02:47:38 PM EST
[ Parent ]

Re: Sydney now (none / 0)

Are you going to Cairns ? Self-styled adventure capital of the world. I saw a travel prog on it once and it looked like the most fun it was possible to cram into one area.

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Sat Jul 15th, 2006 at 04:48:35 AM EST
[ Parent ]

Re: Countdown to $100 oil (28) (none / 0)

Hey Jerome, are you in Sydney?! Being very busy?

Welcome to the land of land clearing, and funny animals, of course.

by das monde on Sat Jul 15th, 2006 at 01:28:22 AM EST
[ Parent ]

Re: Countdown to $100 oil (28) - New records sugge (none / 0)

Bloomberg: Tokyo Oil Surges to Record on Middle East Violence, Nigeria (July 14)

``Together with the Nigerian issue, Israeli attacks on Lebanon could lead to political instability in the whole Middle East,'' said Tetsu Emori, chief commodities strategist at Mitsui Bussan Futures Ltd. in Tokyo, said by phone today.
...
``Oil in New York will perhaps breach $80 a barrel next week, and hit $96 some time in the next two months through the end of September,'' Emori said.

Emori-san is too polite to say $100.

Nothing is 'mere'. — Richard P. Feynman

by Migeru (migeru at eurotrib dot com) on Fri Jul 14th, 2006 at 10:41:45 AM EST

Re: Countdown to $100 oil (28) (none / 1)

Erm, aren't you supposed to be on a beach or something ?

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Fri Jul 14th, 2006 at 10:49:36 AM EST

Re: Countdown to $100 oil (28) (none / 0)

He probably is, laptop and all.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri Jul 14th, 2006 at 11:19:35 AM EST
[ Parent ]

Re: Countdown to $100 oil (28) (none / 0)

Isn't free wi-fi a wonderful thing?

Nothing is 'mere'. — Richard P. Feynman

by Migeru (migeru at eurotrib dot com) on Fri Jul 14th, 2006 at 11:20:54 AM EST
[ Parent ]

Exactly (none / 0)

let's put the things straight...Jerome is supposed to be in the middle of great wilderness with beatiful beaches, family, enjoying life..

ANd I am supposed to be in the middle of a war.

I just wanted to state the obvious...and set it clear :)

I love you Helen.

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Fri Jul 14th, 2006 at 01:06:43 PM EST
[ Parent ]

Re: Exactly (none / 0)

How's that war thing going for you? I assume you're well away from the action?

by Colman (colman at eurotrib.com) on Fri Jul 14th, 2006 at 01:08:23 PM EST
[ Parent ]

Re: Exactly (none / 0)

Yes... I hoped that..until I learned from haaretz that israel thinks that Hezbollahas some rockets thatcan reach Tel-Aviv...not a lot of them but some...so I changed my status :)

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Fri Jul 14th, 2006 at 07:48:18 PM EST
[ Parent ]

Re: Exactly (none / 0)

I love you Helen

Aww shucks {embarrassed}

Tho I think one of my planned diaries in the next few days is gonna provide a big disappointment

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Sat Jul 15th, 2006 at 04:46:44 AM EST
[ Parent ]

New records suggest more to come (none / 0)

Beware of the killer kangaroos, Jerome.

Those who can make you believe absurdities can make you commit atrocities. -Voltaire

by p------- on Fri Jul 14th, 2006 at 11:36:41 AM EST

Re: Countdown to $100 oil (28) - New records sugge (none / 1)

We heard about the Australian TV programme and Dr Bakhtiari on Fran's Breakfast Thread two days ago. We do our best to keep up, you know.

Hope things will get better down there than getting up at 2 pm in the depths of austral January!

When locusts move on, they leave nothing behind

by afew (afew(a in a circle)eurotrib_dot_com) on Fri Jul 14th, 2006 at 11:55:50 AM EST

Re: Countdown to $100 oil (28) - New records sugge (none / 0)

Not much of the wild life down in Sydney...except at ZOO, ha-ha. It took me several years of living here to see kangaroo (in the "wildness") and even that was far north of Queensland. Actually I saw it around the house we rented for our holyday at Airlie Beach. It was more like a pet. First photo shows it. Few months ago I made this second photo visiting some friends around Sydney area (Jarvis bay) . In the end few more photos of "pets" here in my home, Brisbane...Last one ducks having a "pool party" at my back yard, ha-ha.
I don't think Jerome can resist Internet and ET for more then few hours...while he sleeps, of course. Have a good time!

I would appreciate if Sirroco or someone else can make a mosaic of my photos (to save some space) so that people can open them individually ...I don't know how to do it.

by vbo on Sat Jul 15th, 2006 at 10:33:04 AM EST

Re: Countdown to $100 oil (28) - New records sugge (none / 0)

Few more:

by vbo on Sat Jul 15th, 2006 at 10:40:52 AM EST

Re: Countdown to $100 oil (28) - New records sugge (none / 0)

For some reason some photos are not showing...

by vbo on Sat Jul 15th, 2006 at 10:44:59 AM EST

Fuel demand (none / 0)

From a Flemish paper today(my translation):

Israel orders jet-fuel(JP8) for 210 milion dollars in the US. The fuel will be used by Israeli combat-planes for peace and security missions.

Euh....US-fuel + Israeli plane = peace ????

Why not give such fuel to every army?

But I have a question to: since I coulnd't find the original source of this 'news' I looked around and found this on the website of the US DoD:

DEFENSE LOGISTICS AGENCY
Valero Marketing & Supply Co., San Antonio, Texas, is being awarded a maximum $36,781,780 fixed-price with economic price adjustment contract for JP8 jet fuel for the government of Israel. The other location of performance is Corpus Christi Refinery, Corpus Christi, Texas. There were 13 proposals solicited and four responded. Contract funds will expire at the end of the current fiscal year. The date of performance completion is Jan. 30, 2007. Contracting activity is Defense Energy Support Center, Fort Belvoir, Va. (SP0600-06-D-0542).

Does this mean the US is actually paying for this fuel?

The struggle of man against tyranny is the struggle of memory against forgetting.(Kundera)

by Elco B (elcob at scarlet dot be) on Sat Jul 15th, 2006 at 01:40:01 PM EST

Re: Countdown to $100 oil (28) - New records sugge (none / 0)

My heart sinks when I see that, despite all the time and efforts spent by Jerome to enlighten our fellow liberals on Kos, I just came across a post by "pissedpatriot" (uder ID 80883) -- obviously a recent contributor -- who wrote:

The time of cheap oil is NOT OVER, that is nonsense. Oil was just 20 bucks a barrel a few years ago under Clinton. The only things changed as I have mentioned is that china and india need more but their demand is covered, the problem is the mid east instability.

THE REAL problem is the people who think oil is running out have NO UNDERSTANDING of why the price is so high at the moment. You don't seem to grasp what causes oil prices. IT IS SPECULATION. The price is high because of the FEAR of a disruption due to all this war. OIL SUPPLY AT THE TIME IS FINE.

link.

by Lupin on Sun Jul 16th, 2006 at 03:33:23 AM EST

***Countdown to $100 oil (28) - New records suggest more to come | 25 comments (25 topical, 0 editorial, 0 hidden)

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