Peak Oil (was "petroleum geologist explains US war policy")
- Thread starter Bernie_Gunther
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Backatcha Bandit
is not taking your calls
Similar (but more up to date) version of David's second graph:
http://www.bp.com/sectiongenericarticle.do?categoryId=9017906&contentId=7033467
http://www.bp.com/sectiongenericarticle.do?categoryId=9017906&contentId=7033467
Backatcha Bandit
is not taking your calls
^^Attachments
david dissadent
New Member
Great work BB, but if graphs are your thing, then these boys are probibly worth a look....Backatcha Bandit said:I like graphs.
http://graphoilogy.blogspot.com/
Backatcha Bandit
is not taking your calls
Phwooooaaah! *rubs knees* That's almost pornographic.
Cheers, David.
Cheers, David.
Backatcha Bandit
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david dissadent
New Member
Profits slump at BP
BP not looking to clever
There is a strand of thinking that 'peak oil' is a conspiracy with big oil to raise prices. The problem with this is that most of the worlds oil is not under the control of big oil, but held by soveriegn states. Much of big oils profits come now from refining and selling end products rather than extraction (although there are still handsome profits there). The thing is oil companies are slowly becoming less profitable. The reason is that there reserves are steadily depleating which means they have to buy more from soveriegn states.
Refining is becoming more expensive as the cost of oils increases due to rising prices and the refiners are driven hard to keep the end product sellable on the market. The other key problem is the type of oil that is available. Crude is not all the same. The "good stuff" is light sweet crudes that are easy to convert into byproducts like petrolium or kerosine with minimal sulfer in the product. But there is very little of this left on the markets most of what is left is heavier sour (loads of sulfer) oils. This takes a hell of a lot more work in the refinaries to crank out the by products. This means they get less through the refinaries than they would and it costs more to get it.
The big companies, over the next few years are going to be struggling for profit.
If there is a conspiracy to stop new oil fields comming on to the market it seems almost ideocy for the big oil companies to be doing it.
BP not looking to clever
There is a strand of thinking that 'peak oil' is a conspiracy with big oil to raise prices. The problem with this is that most of the worlds oil is not under the control of big oil, but held by soveriegn states. Much of big oils profits come now from refining and selling end products rather than extraction (although there are still handsome profits there). The thing is oil companies are slowly becoming less profitable. The reason is that there reserves are steadily depleating which means they have to buy more from soveriegn states.
Refining is becoming more expensive as the cost of oils increases due to rising prices and the refiners are driven hard to keep the end product sellable on the market. The other key problem is the type of oil that is available. Crude is not all the same. The "good stuff" is light sweet crudes that are easy to convert into byproducts like petrolium or kerosine with minimal sulfer in the product. But there is very little of this left on the markets most of what is left is heavier sour (loads of sulfer) oils. This takes a hell of a lot more work in the refinaries to crank out the by products. This means they get less through the refinaries than they would and it costs more to get it.
The big companies, over the next few years are going to be struggling for profit.
If there is a conspiracy to stop new oil fields comming on to the market it seems almost ideocy for the big oil companies to be doing it.
david dissadent
New Member
http://ca.news.yahoo.com/s/capress/071025/business/oil_prices_194
US inventories fall during the season they are supposed to climb. After the summer driving season and before deep winter hits, US refinaries stock up on oil. But they have not this year.
Oil has also hit $92 a barrel on the benchmarks. This is on the fear that Tureky might invade Iraq and take Kirkuks production off line (not the southern oil fields). The last time oil was at this cost the Mullahs had taken Tehran and the worlds second largest producer had been taken out of the market.
The Hayek types always say trust the markets.It really really looks like peak oil is here, well if you trust the markets.
E2A doing alot of reading it seems that this fall is due to the refinaries not the amount of oil available. But this is expected, the light sweet grades of oil are now. The much larger volumes of heavy sour grades of oil mean that places like BPs Whiting and other refinaries are getting involved in alot more maintenance as the refinaries have to be worked harder to turn a barrel of heavy sour into finnished products. The US has been importing finnished product to cover the gap in its refining capacity but its hit the end of the buffers on this avenue.
But the lack of light seet crudes on the market is due to them having peaked first and now everyone is opening up there medium and heavy crude fields to the market. That in itself is a sign we have peaked.
Opec discussing ending dollar hegmoney
US inventories fall during the season they are supposed to climb. After the summer driving season and before deep winter hits, US refinaries stock up on oil. But they have not this year.
Oil has also hit $92 a barrel on the benchmarks. This is on the fear that Tureky might invade Iraq and take Kirkuks production off line (not the southern oil fields). The last time oil was at this cost the Mullahs had taken Tehran and the worlds second largest producer had been taken out of the market.
The Hayek types always say trust the markets.It really really looks like peak oil is here, well if you trust the markets.
E2A doing alot of reading it seems that this fall is due to the refinaries not the amount of oil available. But this is expected, the light sweet grades of oil are now. The much larger volumes of heavy sour grades of oil mean that places like BPs Whiting and other refinaries are getting involved in alot more maintenance as the refinaries have to be worked harder to turn a barrel of heavy sour into finnished products. The US has been importing finnished product to cover the gap in its refining capacity but its hit the end of the buffers on this avenue.
But the lack of light seet crudes on the market is due to them having peaked first and now everyone is opening up there medium and heavy crude fields to the market. That in itself is a sign we have peaked.
Opec discussing ending dollar hegmoney
Backatcha Bandit
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Backatcha Bandit
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david dissadent
New Member
Its called 'market forces'. When opec had swing production it could manipulate these forces. It now lacks the reserve capacity to do so. So the highest quality light sweet crudes sell for $95-$98 because there are refiners who are willing to purchase this crude for that price. If there was too much oil on the market no one would be buying oil at those prices as they would not need it or could not sell it on to the consumer.
What will happen over the next year is called 'demand destruction' (especialy in the developed world) as a mixture of very high crude prices and a global slowdown (starting with financial sector loss of bonuses, pay cuts and job losses already underway) will mean there will be less apatite for finnished goods and crude products. This will help ease demand, but as long as China Russia Brazil India and others continues to grow this demand desctruction will eventualy be met by demand growth back up to 87 million barrels a day and prices will be extremely high.
The idea that it is mere baseless speculation driving up the prices when US stocks are falling in the time between the 'driving season' the winter heating season is rather laughable. US fluctuations are not huge but they are enough to worry all concerned that when the winter demand for heating fuel kicks in its stocks at refinaries are really going to get low. (And this on the back of the great year of biofuels, when world food stocks have been halved by turning American corn from a food into a fuel.)
Petrobras' Tupi Oil Field May Hold 8 Billion Barrels
http://www.bloomberg.com/apps/news?pid=email_en&refer=home&sid=a5Vhp3Ss07rw
Please note that the Tupi find is just a "tiny" part of an entire new oil province which Petrobras says lies beneath its existing fields. This is yet another indication that the amount of available oil emanating from the Earth's mantle is virtually unlimited in practice.
The present extortionate oil price is entirely due to market manipulation by the leading imperialist powers and not, as the resident doom brigade insist, to any real scarcity.
http://www.bloomberg.com/apps/news?pid=email_en&refer=home&sid=a5Vhp3Ss07rw
Please note that the Tupi find is just a "tiny" part of an entire new oil province which Petrobras says lies beneath its existing fields. This is yet another indication that the amount of available oil emanating from the Earth's mantle is virtually unlimited in practice.
The present extortionate oil price is entirely due to market manipulation by the leading imperialist powers and not, as the resident doom brigade insist, to any real scarcity.
Crispy
The following psytrance is baṉned: All
Imperialist powers? 2/3 of the world's oil is in the ME, under government control.
We currently consume approx 80m barrels of oil per day. This works out at approx 30b barrels per year. Assuming this find is as big as it says, then Petrobas now has enough reserves to keep us going for 2/3 of a year.
We currently consume approx 80m barrels of oil per day. This works out at approx 30b barrels per year. Assuming this find is as big as it says, then Petrobas now has enough reserves to keep us going for 2/3 of a year.
david dissadent
New Member
8 billion barrels is the high end of the estimate. Prudhoe Bay has circa 16Billion barrels of recoverable oil. This field may only have 5 billion with underminate flow rates, oil/ water mix and alot of gas in it.
Last year it was Jack -2 that was saving is (every time it was reanounced). This year both Mexico's Cantarell (20 billion barrels) and Kuwaits Burgan (70 billion barrels) fields are acknowledged to have gone into decline, with Cantrell allegedly hitting 13% depletion rates.
david dissadent
New Member
Off the top of my head but consumption is at 87 million barrels a day. However that includes heavy tar sand derived oils, gas to liquid converted oil, biofuel and coal to petrol.Crispy said:
Having said that I think this demand is now artificialy high, being held up there by China insulating its consumers from the price climb
http://www.atimes.com/atimes/China_Business/IK09Cb01.html
and US producers allegedly taking a much smaller hit to try to prevent the political and ecomic impact of high finnished product from getting to the pumps in the hope that $96 oil is a price spike. This is a short term artificial situation. Once the true price is filtered through to the consumers demand should slacken again, although at what political cost remains to be seen.
david dissadent
New Member
The US is an ecomony based on the consumption and use of cheap energy. Your thesis is so irrational as to be laughable. The cheaper energy is the more money the US makes. High oil prices are inflationary and will have a terrible cost on the US economy and global productivity.bigfish said:
david dissadent
New Member
http://uk.reuters.com/article/oilRpt/idUKL1388199520071113
The worlds second largest oil producers experiances shortages.
Edited. This is largely as they have promised to cap the price of finnished oil product and dont want to take the hit in the pocket.
The worlds second largest oil producers experiances shortages.
Edited. This is largely as they have promised to cap the price of finnished oil product and dont want to take the hit in the pocket.
free spirit
more tea vicar?
something just occurred to me, I'm not sure if it's been mentioned in this thread before or not, but I'm not searching through this monster to check so I'll just post it.
The thought occurred to me while looking at this graph, when I was looking at the drop in oil discovery's (new oil finds) in the early 2000's, and the predicted long term decline in new oil finds according to that graph.
No I have a mate who from 1997-2001/2 ish was working as a surveyor for the biggest (I think) global offshore oil surveying company. From conversations I've had with him about this, from about 1998 til the early 2000's there was a massive drop off in the amount of surveying their company, and I believe, pretty much all the big companies were doing, basically because the oil price had been so low since the early 90's, and the stated reserves on the existing fields (that were later massively downgraded) were so high, that it just wasn't economically viable for them to be out there doing the surveying work in most areas. I'm sure I remember him telling me that their company in this period basically ended up pulling all their boats apart from 1 or 2 into port, mothballing them and laying off most of their staff.
The assumption at this time was that the oil price was likely to stay at or below the $20-25 a barrel average that it had been throughout the most of the (late) '80's and 90's throughout the 2000's, and even when the price peaked around 9/11 it was assumed that this was a temporary blip, and it wasn't until 2004/5 that the exploration companies really started to be confident enough in the long term higher prices of oil that they began gearing up again to go off exploring full tilt again.
My mate's been back offshore since 2006 btw as their company and I believe all the others have unmothballed their ships and are now exploring the areas of the world that weren't viable at $20 a barrel, but are at $50 plus.
Sorry all this is anecdotal, I'll go off and have a dig around for the figures, I just looked at that graph and realised that their assumptions on the long term drop off in the rate of new finds could well be based on a lack of background understanding of what was actually going on in the exploration industry. Discovery rates were actually rising fairly fast in the late 90's when these firms were out there exploring full tilt, and only actually dropped off around the point when the firms were mothballing most of their fleets.
The thought occurred to me while looking at this graph, when I was looking at the drop in oil discovery's (new oil finds) in the early 2000's, and the predicted long term decline in new oil finds according to that graph.
No I have a mate who from 1997-2001/2 ish was working as a surveyor for the biggest (I think) global offshore oil surveying company. From conversations I've had with him about this, from about 1998 til the early 2000's there was a massive drop off in the amount of surveying their company, and I believe, pretty much all the big companies were doing, basically because the oil price had been so low since the early 90's, and the stated reserves on the existing fields (that were later massively downgraded) were so high, that it just wasn't economically viable for them to be out there doing the surveying work in most areas. I'm sure I remember him telling me that their company in this period basically ended up pulling all their boats apart from 1 or 2 into port, mothballing them and laying off most of their staff.
The assumption at this time was that the oil price was likely to stay at or below the $20-25 a barrel average that it had been throughout the most of the (late) '80's and 90's throughout the 2000's, and even when the price peaked around 9/11 it was assumed that this was a temporary blip, and it wasn't until 2004/5 that the exploration companies really started to be confident enough in the long term higher prices of oil that they began gearing up again to go off exploring full tilt again.
My mate's been back offshore since 2006 btw as their company and I believe all the others have unmothballed their ships and are now exploring the areas of the world that weren't viable at $20 a barrel, but are at $50 plus.
Sorry all this is anecdotal, I'll go off and have a dig around for the figures, I just looked at that graph and realised that their assumptions on the long term drop off in the rate of new finds could well be based on a lack of background understanding of what was actually going on in the exploration industry. Discovery rates were actually rising fairly fast in the late 90's when these firms were out there exploring full tilt, and only actually dropped off around the point when the firms were mothballing most of their fleets.
free spirit
more tea vicar?
[source]
can't find figures for the amount of oil exploration that's going on over the last 20 years or whatever, but contrast the above quote about the skills shortage in the offshore survey sector, to the sector laying shedloads of people off around 1999-2002, just before a dramatic drop in new oil finds.
had this not happened, it stands to reason IMO that the rate of discovery of new fields would have continued it's late 90's rise through the last decade.
erm hold on, am I agreeing with bigfish here?
david dissadent
New Member
You are right about the lack of exploration in the mid 90s to the mid 2000s or at least the steady decline in exploration up to a point. However you will notice that two big drops in discovery occur just after 1970 when the bulk of the Prudhoe Bay and North Sea oil had been discovered then again in 1980, yet these drop offs (that are never sustainably recovered) happen during and after periods of huge price increases. 1973 and 1980 saw enormous jumps in the price of oil and the period high and ultra high oil prices (roughly 1973 till 1985) did not really lead to an increased rate of discovery.
The one spike is in 1975 onwards. This spike is that of where much of the Cantarell was booked, yet this coincided with the spike meaning it was financed and approved in the low oil price era of the late 60s early 70s.
It is also worth pointing out that the oil that is being discovered now is often so deep that it is not often price but engineering and physics that determine if it is recoverable, as the energy invested to get it out may not be worth while. i.e. whether the oil is $20 or $100 that does not affect its ability to return a net energy investment. When it is comercialy and engineering viable to extract the rate of flow is often not all that good either.
The real killer is ofcourse if one looks at the fields discovered in the 40s through to the 60s. Garguantuan fields that are simple not even being replaced by a factor of 1/6th the rate.
One of the problems being highlighted towards the new Brazilian field discovered. Everything that can drill oil has been booked out years in adavance now. Too keep the worlds current oil supply flat has taken everything we having pumping to the point breakdowns are starting to have an impact on oil production.
The one spike is in 1975 onwards. This spike is that of where much of the Cantarell was booked, yet this coincided with the spike meaning it was financed and approved in the low oil price era of the late 60s early 70s.
It is also worth pointing out that the oil that is being discovered now is often so deep that it is not often price but engineering and physics that determine if it is recoverable, as the energy invested to get it out may not be worth while. i.e. whether the oil is $20 or $100 that does not affect its ability to return a net energy investment. When it is comercialy and engineering viable to extract the rate of flow is often not all that good either.
The real killer is ofcourse if one looks at the fields discovered in the 40s through to the 60s. Garguantuan fields that are simple not even being replaced by a factor of 1/6th the rate.
One of the problems being highlighted towards the new Brazilian field discovered. Everything that can drill oil has been booked out years in adavance now. Too keep the worlds current oil supply flat has taken everything we having pumping to the point breakdowns are starting to have an impact on oil production.
david dissadent
New Member
He believes the US 'lower 48' peaked in 1973 due to lack of investment not lack of oil. The same year that oil companies were building vastly more expensive offshore plactforms in the gulf of Mexico and tripling the number of drilling rigs, oil prices spiked they were not pumping enough because of lack of investment.free spirit said:erm hold on, am I agreeing with bigfish here?
david dissadent
New Member
http://observer.guardian.co.uk/world/story/0,,2212899,00.html
(or not editd to add it has not even broke $95 today, guess the markets had already predicted this)
Brace for $101 a barrel oil tomorrow.
(or not editd to add it has not even broke $95 today, guess the markets had already predicted this)
Idris2002
canadian girlfriend
free spirit said:something just occurred to me, I'm not sure if it's been mentioned in this thread before or not, but I'm not searching through this monster to check so I'll just post it.
The thought occurred to me while looking at this graph, when I was looking at the drop in oil discovery's (new oil finds) in the early 2000's, and the predicted long term decline in new oil finds according to that graph.
No I have a mate who from 1997-2001/2 ish was working as a surveyor for the biggest (I think) global offshore oil surveying company. From conversations I've had with him about this, from about 1998 til the early 2000's there was a massive drop off in the amount of surveying their company, and I believe, pretty much all the big companies were doing, basically because the oil price had been so low since the early 90's, and the stated reserves on the existing fields (that were later massively downgraded) were so high, that it just wasn't economically viable for them to be out there doing the surveying work in most areas. I'm sure I remember him telling me that their company in this period basically ended up pulling all their boats apart from 1 or 2 into port, mothballing them and laying off most of their staff.
The assumption at this time was that the oil price was likely to stay at or below the $20-25 a barrel average that it had been throughout the most of the (late) '80's and 90's throughout the 2000's, and even when the price peaked around 9/11 it was assumed that this was a temporary blip, and it wasn't until 2004/5 that the exploration companies really started to be confident enough in the long term higher prices of oil that they began gearing up again to go off exploring full tilt again.
My mate's been back offshore since 2006 btw as their company and I believe all the others have unmothballed their ships and are now exploring the areas of the world that weren't viable at $20 a barrel, but are at $50 plus.
Sorry all this is anecdotal, I'll go off and have a dig around for the figures, I just looked at that graph and realised that their assumptions on the long term drop off in the rate of new finds could well be based on a lack of background understanding of what was actually going on in the exploration industry. Discovery rates were actually rising fairly fast in the late 90's when these firms were out there exploring full tilt, and only actually dropped off around the point when the firms were mothballing most of their fleets.
I'll match your anecdote with one of mine. In Eritrea in 1999/2000 I knew an English oil explorer who'd been operating out of Singapore. He was laid off indefinitely, and ended up in Eritrea after becoming a navigator on a private yacht (apparently there's a little subculture of people who know astral navigation and who hitch rides on ocean going yachts - they're handy to have around if your GPS fails).
In the decade that followed the lower 48 peak Texas experienced the greatest drilling boom in history on the back of Texas Railroad Corporation having amended production quotas to '100% allowable' and the quadrupling of oil prices in the wake of the two 'oil shocks' of the 1970's. This drilling boom using modern technology occurred in the most business-friendly nation / state which also held the greatest expertise in the oil industry.david dissadent said:
The result is telling, as Jeffrey Brown (aka Westexas) reports on 'the Oildrum' - oil production in Texas has trended relentlessly downwards for 34 years. Wells in formerly high producing fields are now producing similar liquid volumes than in the past, but with a 99% water cut! The message I've taken aboard from this situation is that, post peak, it matters little how much technology, resources or money is thrown at the area, it's virtually impossible to restore output to previous levels as we've seen in UK and Norwegian N Sea and an increasing number of other oil provinces. Why then do some still insist that the world will behave differently when we pass (or have passed) the global peak?
david dissadent
New Member
Well oil hits the magic $100 a barrel. For us in the UK it is bad news, as the pound is not falling against the dollar meaning that when these costs feed back to the pump we will be looking at £1.10-£1.20 per liter. That should be in about another couple of weeks.
david dissadent
New Member
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