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.
Earlier "Countdown Diaries" (links to both ET and DK when the versions are different enough):
Countdown to $100 oil (27) - 'Mission Accomplished' - High oil prices are here to stay
Countdown to $100 oil (26) - Time to bet again (eurotrib)
Countdown to $100 oil (26) - Time to bet again (dKos)
Countdown to $100 oil (25) - Iran vows that oil prices will not go down
Countdown to $100 oil (24) - What markets are telling us about future energy prices
Countdown to $100 oil (23) - Running out of natural gas in North America
Countdown to 100$ oil (22) - gas shortages in the UK - 240$/boe
Countdown to 100$ oil (21bis) - long term vs short term worries (dKos)
Countdown to 100$ oil (21) - 8-page extravaganza in the Independent: 'we're doomed'
Countdown to 100$ oil (20) - Meteor Blades is Da Man in 2005
Countdown to 100$ oil (19) - Your bets for 2006 (Eurotrib)
Countdown to 100$ oil (19) - Your bets for 2006 (DailyKos)
Countdown to 100$ oil (18) - OPEC happy with oil above 50$
Countdown to 100$ oil (17) - Does it matter politically? A naked appeal for your support
Countdown to 100$ oil (16) - We'll know on Monday
Countdown to 100$ oil (15) - the impact on your electricity bill
Countdown to 100$ oil (14) - Greenspan acknoweldges peak oil
Countdown to 100$ oil (13) - Katrina strikes / refinery crisis
Countdown to 100$ oil (12) - Al-Qaeda, oil and Asian financial centers
Countdown to 100$ oil (11) - it's Greenspan's fault!
Countdown to 100$ oil (10) - Simmons says 300$ soon - and more
Countdown to 100$ oil (9) - I am taking bets (eurotrib)
Countdown to 100$ oil (9) - I am taking bets (dKos)
Countdown to 100$ oil (8) - just raw data
Countdown to 100$ oil (7) - a smart solution: the bike
Countdown to 100$ oil (6) - and the loser is ... Africa
Countdown to 100$ oil (5) - OPEC inexorably raises floor price
Countdown to 100$ oil (4) - WSJ wingnuts vs China
Countdown to 100$ oil (3) - industry is beginning to suffer
Countdown to 100$ oil (2) - the views of the elites on peak oil
Countdown to 100$ oil (1) (eurotrib)
Countdown to 100$ oil (1) (dKos)