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Deja Q Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:06 PM
Original message
Cheap oil is a thing of the past

Before the start of the Iraq war his media empire did so much to promote, Rupert Murdoch explained the payoff: ?The greatest thing to come out of this for the world economy, if you could put it that way, would be $20 a barrel for oil.?

Crude oil in New York briefly traded at $40 a barrel last week, a 13-year high.

Those who expected big economic benefits from the war were, of course, utterly wrong about how things would go in Iraq. But the disastrous occupation is only part of the reason oil is getting more expensive; the other, which will last even if we somehow find a way out of the quagmire, is the intensifying competition for a limited world oil supply.

Thanks to the mess in Iraq ? including a continuing campaign of sabotage against oil pipelines ? oil exports have yet to recover to their prewar level, let alone supply the millions of extra barrels each day the optimists imagined. And the fallout from the war has spooked the markets, which now fear terrorist attacks on oil installations in Saudi Arabia.

Even if things had gone well, however, Iraq couldn't have given us cheap oil for more than a couple of years at most, because the United States and other advanced countries are now competing for oil with the surging economies of Asia.

The question, instead, is when the trend in oil prices will turn decisively upward. That upward turn is inevitable as a growing world economy confronts a resource in limited supply. But when will it happen? Maybe it already has.

I know, of course, that such predictions have been made before, during the energy crisis of the 1970s. But the end of that crisis has been widely misunderstood. Prices went down not because the world found new sources of oil, but because it found ways to make do with less.

(more, much more of interest...)

Well, only lies were used to start the Iraq war.

More importantly, the US corporations saying "Fuck you" to Americans and giving all those jobs to that region is why they are surging. Duh.

And when Asia has to hit the breaks, all hell is going to break loose...

Either way, the world cannot continue to require increased demand. Not when supply is going to (or has already begun to) shrink. That truly is a disaster. Why does the corporate world gleefully OVERLOOK THE PROBLEM?
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Indiana_Dem Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:15 PM
Response to Original message
1. I don't know hypnotoad,
I understand what you're saying....exactly.

What to do? :shrug:

I hope we at least have 5 years to prepare a little because it will come, it's just a matter of when.
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ramblin_dave Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:21 PM
Response to Original message
2. But the Saudis promised cheaper oil in time for
the election. I'm waiting to see if that happens.
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Zhade Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:22 PM
Response to Original message
3. Peak Oil Kick

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trof Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:25 PM
Response to Reply #3
4. About Peak Oil:
Association for the Study of Peak Oil
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nostamj Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:26 PM
Response to Original message
5. oil is a thing of the past

it's finite and running out. and those with their heads in the sand are not going to find any new supplies...

glad i (probably) won't live to see the end but very frightened for the kids who will...
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ThomWV Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:28 PM
Response to Original message
6. There Is An Informal OPEC Meeting Next Week At Which
the Saudis will announce a 1.5M barrel per day increase in their output, and you can expect that to be increased to 2.5 at the next official meeting. The price will drop into the mid-high $20's and it will take 6 weeks for you to see the effect. As it is now some Prince farts and the spot market jumps a half a buck, and you see the price at the pump go up a nickel while you're standing there. That's what irks the hell out of me. All those stations will 50,000 gallons of $1.74 gas in the underground tank and selling it for over two bucks. That and the instant upward movement on prices at the drop of a rumor anywhere in the world but that it takes tankers with finished gasoline landing at the Port of New York, unloaded and on the trucks before you'll ever see it go down an cent.
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slor Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:28 PM
Response to Original message
7. This is why you should tell people ...
that buying from Wal-Mart, and other places that outsource labor, are INCREASING the industrialization of China (our oil competitor) and are therefore, UNPATRIOTIC! We need to produce alternative energy, and promote its' use around the world (and here of course). Think about it! Kerry needs to push this hard and heavy. We are already way past this being an issue. This will also bring the fact that they are enslaving the Chinese as well, and bring an end to that.
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Deja Q Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 04:00 PM
Response to Reply #7
10. Foreign outsourcing is legitimized slavery
America's past featured people who worked for nothing and were treated less.

America's present features people being worked for virtually nothing in countries where virtually nothing is needed. So while we are exploiting them and urinating on our own citizens (and those who come here from there!), we say we're helping them out by industializing them. (Which is pure, corn-fed bullshit... we all know of their labor and environmental laws - or, rtaher, the lack of them...)

Add to the justification is the argument of price competition. (for 'price competition', read 'devaluing the wages of jobs Americans need to survive on'.)

Corporate america disgusts me more and more every day. They only care for their profits. And when China's economy goes down or when the oil problem starts to become a concern... (While the US uses 25%+ of the oil supply, China's racking it up at 8% and increasing... You can bet your sweet bippy that a big confrontation is inevitable, if we want to keep our economic system in place...)
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amazona Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:32 PM
Response to Original message
8. LA state budget just announced plans on $28 a barrel oil
One of the lawmakers said bluntly that oil does not go up and stay up, it will go down. Based on our experience, this is the way it goes. This is an oil-producing state, which benefits from high oil prices, and no one is counting on oil to remain at $40 a barrel -- that would be an irresponsible pipe dream.

The corporate world isn't gleefully overlooking any problem, there is a benefit to being able to manipulate and raise prices artificially high, but this doesn't mean the party will go on forever.

Peak oil is to my mind a century away. Or more. Doesn't mean I'm right, but I'm not laying awake at nights planning on surplus oil profits to bail Louisiana (or any other state) out of the * economic mess.

Don't know how long they'll keep the link up but here it is:

Some corporations and states benefit from high prices, no wonder they don't consider it a problem. This is what Louisiana considers a problem:

... the revenue panel used a conservative estimate of $28 a barrel for the next fiscal year. If the average price falls below that, or if other state revenues come in above or below projections, the Legislature could be forced to make midyear corrections to the budget.

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Deja Q Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 04:07 PM
Response to Reply #8
11. Ok, so support the big oil industry.
Edited on Sat May-15-04 04:11 PM by HypnoToad
Fall for their swindle. They'll have the money to survive as everybody else starts to suffer and die around them.

Many web sites have said that between 2000 and 2010 is when peak oil will occur. Now maybe the development and encouragement of SUVs/hummers is a reason why prices now are out of control. More people have them and want more gas to fuel them. Remember, * said "We need an energy policy that encourages consumption". Does * want us to consume so much oil that attacking other countries who use lots of it becomes a "need"?!

And given how our society runs off of personal profit and money rather than the long-term continuance of a SOCIETY (world society, American society, whatthefuckever), there is a problem that many are gleefully overlooking.

But you think there's no problem. Fine. What will it take to convince you that we should do something NOW instead of waiting until it's too late (and it's already way beyond too late, but like with Marie Antoinette, you're happy just to ignore what's going on around you...)

One other note, do you think there's a problem with * spending lots of money? I dunno about you, but I'm damn tired of our generation (starting with that human filth Reagan) squandering things so that our future generations will have to pay a harsh price they shouldn't have to pay one frigging penny for. So you can go and live in your denial and buy 7 Hummers, one for each day, for all I care anymore. You're basically saying "Fuck you" to future generations.
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amazona Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 05:42 PM
Response to Reply #11
15. I'm not supporting them, I'm just saying there's a reason...
...that corporate America is not as distressed as it might be about current oil prices and that higher oil prices are actually of value to at least some businesses and state governments.

At this time the evidence does not convince me that we are anywhere near running out of oil. I am satisfied that the price is artificially high and can't stay this high. Since my gut feeling is of little value as evidence, I offered the opinion of at least one state legislature that agrees with me.

I think you missed the point of my post. Just because I think the price will fall, perhaps sooner than you think, it doesn't mean I believe in waste. My Scottish ancestry shivers at the idea. My car gets 38 miles to the gallon, and I work out of my home, so I think I'm doing my share.

But, in theory, manipulating oil prices and making the price of gasoline "too" high is better for future generations because it gives a profit motive to developing alternate energy sources. Probably explains why the oil industry and OPEC allowed prices to remain in the basement for so long throughout much of the 80s and 90s. The cheap oil of those decades doomed many a plan for alternate energy sources. As long as we live in a capitalist society, we have to allow for businesses to make a profit. Which is a better environment to encourage the development of high mileage cars -- oil is $100 a barrel or oil is $20 a barrel.

An argument can be made that high oil prices are better for the environment than low oil prices.

I'm not saying that I agree with the argument, but I've heard it made and it has at least some merit.

THe point to my post, and perhaps it was poorly made, is that high oil prices are not all bad. You won't hear me complaining if gas prices go back to 87 cents a gallon, but let's not pretend such a thing is good for future generations.

There will be no action taken to develop alternate energy sources in any serious, profitable way until it can be PROVEN that oil prices are going to get high and stay high. The proof is just not there. There are lots of oil reserves -- so many that it is really a threat to the future of our atmosphere and climate that so much fossil fuel will be burned. So I would ask you if bringing down the price of oil and gas is really the best approach for the environmentalist. It is a thorny issue.
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brokensymmetry Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 03:34 PM
Response to Original message
9. Good post, good article.
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Gregorian Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 04:11 PM
Response to Original message
12. Cheap oil never existed.
The real price of fuel is not measured in money.
Please, when will we learn this? After another war? After another oil spill? After the coasts and remote areas are peppered in oil derricks.

The answer is not easy, and it isn't oil. (At least, if six billion people are using it. )
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Deja Q Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 04:58 PM
Response to Reply #12
14. Bingo!
Life is not always about money, and never should be, though corporate america has perverted it so.

Indeed, dairy farmers (amongst a lot of examples...) are selling out because it's cheaper. Now I'm no maths genius, but fewer cows = less milk. And if they sell their lands so we can build homes on them, the topsoil used to create grain for cows (and other life forms including humans?) to eat is irreversably destroyed.

So while we're making more homes for people, we're destroying the ability to feed them! :crazy: Eventually, there'll be no homes for people because people'll have done themselves in, thanks to money and greed. Hell, I haven't even touched the tip of the iceberg and I've already mentioned two REAL issues as to the folly of our 'society'.
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amazona Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 05:49 PM
Response to Reply #14
17. developers are the scum of the earth, no argument there
However, far from destroying our ability to feed people, we are still increasing productivity in food production. It takes fewer and fewer farmers to produce -- or, often, as in the case of the dairy industry -- over-produce food. Adults do not need to be drinking all of the milk that we have pushed upon us. Less milk is probably a good idea in the American diet.
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Deja Q Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 09:09 PM
Response to Reply #17
18. Except we are stressing existing farms and creating a false sense of

A lot of farming is done with the assistance of petrochemical fertilizers (oil).

You have a great point with milk except I've heard a lot of people (on DU and others who don't know of DU) complain about milk prices. For those who have troubles digesting milk, this isn't much of a problem. But milk has a high concentration of calcium, so it can't be all that bad... On the other hand, if it leads to less waste, maybe a higher price is the only solution. Overproduction giving people a false sense of security and incentive to waste... ?
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rustydad Donating Member (753 posts) Send PM | Profile | Ignore Sat May-15-04 04:32 PM
Response to Original message
13. Some things to consider....
Peak oil, or the point where one half of the extractable oil has been extracted is one event that should trouble us. The other event is when the rate of extraction falls below the global demand. The later point is more critical in terms of pricing and may happen well before "peak". In fact it looks like it has already happened.

Another issue is how steep the extraction curve will be on the downside. Extraction is limited by geology as well as politics. In the last few decades improvements in technology have allowed oil extraction to be increased over older methods. Flooding with water and horizontal wells are allowing oil fields to be extracted at greater rates toward the end of the life of a field. In the end this will make the falloff curve steeper.

On the other hand higher oil prices will lead to some demand destruction as economies are driven into recessions and people simply will be unable to continue to afford gasoline and other oil derivatives. This will make the down curve rather bumpy, not a nice smooth curve such as the curve has been until now.

In any case things are about to change dramatically for humans on this planet. Bob
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knight_of_the_star Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 05:47 PM
Response to Original message
16. National Geographic's newest issue has that story on the cover
I'm reading it right now, I am actually kind of shocked that SOMETHING mainstream would be reporting this, and here they are doing it!
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