BP's Stunning Warning: "Every Oil Storage Tank Will Be Full In A Few Months"

[niky]

Originally Posted by solarguy

I think the more sophisticated macroeconomic analysis of peak oil suggests that around the peak, or just after the peak in production, prices will get very volatile.

That's what we thought was happening around 08, and then US Shale came in... but I have no doubt that we'll experience the same thing once the expensive stuff starts sputtering out, as well.

Originally Posted by MetroMPG

what is the time delay between prices going back up and drilling re-commencing?

I think this:

Originally Posted by solarguy

That will lead to a much slower build up of non-conventional oil production the next go-round. And Saudi laughs all the way to the bank.

Until the prices stabilize at a higher level for a relatively long period of time, I think investors will be wary of "expensive" non-conventional oil. Maybe a year or more of steady price increases?

[MetroMPG]

I think you give them too much credit. (No pun intended!)

The minute profit margin re-appears is when the next boom starts.

[redneck]

Originally Posted by niky

You're not reading much about the oil market, then.

Funny, I could say the same applies to you.

solarguy

I think there is also some international politics and economic sabotage going on.

Only some...???

I think there is a lot, a lot more...

MetroMPG

Boom & bust, baby.

That's the cycle. It will take out the small guys and the Johnny-come-lately.
As the smaller and insolvent oil drilling companies go bust, the larger oil companies will more than likely acquire their assets for pennies on the dollar. In many cases that will probably include the drilling and mineral rights for those deposits. This will further consolidate their control of the supply and output.

Frank Lee

Well it IS awash in EXTRACTED oil for the next several MONTHS.

After that I'm betting against you.

Extracted or not, the oil is still there.

What kinda odds are you giving...???


>

[user removed]

Volume of the Earth 260,000,000,000 cubic miles.

Oil extracted from the Earth 169 cubic miles.

How much left?

regards
mech

[niky]

Originally Posted by MetroMPG

I think you give them too much credit. (No pun intended!)

The minute profit margin re-appears is when the next boom starts.

Only time will tell. 2017 is likely when we will find out.

As solarguy says, the Saudi gameplan seems to be to put everyone off of investing. Granted, the capital to reinvest is there, but nobody wants to be the one holding the potato when the French Fry market drops.

Originally Posted by redneck

Funny, I could say the same applies to you.

I read way too much about oil.

My job is merely to report on cars.

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I don't doubt we will still have oil reserves long after we're all dead and gone. The only question is the economic viability of extracting that oil.

It's similar to gold... we have millions of tons of gold floating around in seawater. But it might as well not be there for all the good it does us.

-

Granted, we could eventually find out that oil deposits are naturally formed abiotically, meaning that "dry" wells will eventually get replenished as new oil seeps upward into them... rather than seeping sideways from untapped deposits... but we're still facing the same issue as with ground water... it appears that our rate of extraction still exceeds the rate of replenishment.

[user removed]

I wonder if the tanks filled to the brim include the US strategic reserves. It would be a good time to replenish the reserves to maximum capacity considering the fact that it could provide a buffer to the next price jump. I guess it's just wishful thinking to believe any govt tentacle could actually be run competently.

The Saudis need $80 a barrel to cover the cost of their normal expenditures which have exploded since OPEC was formed. Now we see no such cooperation in that area, greed is destroying the cartel. Wild price fluctuations are the direct result and many of those futures buyers have likely been burned quite badly if this "cheap" cycle continues.

AS far as fuel is concerned, for me it's cheaper than ever, even compared to the penny a mile it cost me 50 years ago. Wonder what the adjustment for the US taxable mileage based business deduction will be for THIS year.

regards
mech

[sendler]

Originally Posted by Old Mechanic

Volume of the Earth 260,000,000,000 cubic miles.

Oil extracted from the Earth 169 cubic miles.

How much left?

regards
mech

Funny!
Oil and coal is fossilized biological matter that was once alive on the SURFACE of the earth or oceans and then died and got burried 300 million years ago.
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There is plenty of molten nickel and iron in the core of the earth if you want that.
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How much left? Supply and demand will form a platue after 2030 as we frac the last drops of oil and gas from every crack in the surface of the Earth. That will last another 50 years until it inevitibly falls off the top and production slides down over the next 100 years. Forever. Coal and gas will be around a bit longer to help keep us warm.
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Anyone that really thinks a starving and freezing humanity won't level every mountain and frac every crack for it's burried treasure is completely wasting their time protesting when they should be focusing on how to use this energy wealth to transform civilization to a sustainable carbon free economy.
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https://en.wikipedia.org/wiki/Predic...ng_of_peak_oil
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[user removed]

The oil economy will transition to a solar and lunar economy, direct solar, hydro (indirect solar), and tidal (lunar). The two most cost effective will be hydro (been around over 2k years) and solar, which can easily supply the power needs of this planet.

Global warming will then transition to global cooling as more surface heating is redirected to power generation and the carbon levels will drop as quickly as they rose.

All the "sky is falling" fear mongering is basically a money grab, if you believe that supply has been 50% exhausted (peak oil). Then after we spend a significant part of the planets net worth on rectification of global warming, the tactic will change or become obsolete as technology and efficiency progress to reduce the watt hours per mile per passenger cost of transportation to way below 100, possibly below 10 in examples already developed technologically ((e3t).

This progression will occur because it has NO other potential pathway. My invention will be a part of that pathway far into the future, possibly centuries beyond my lifespan.

It's going to happen and at some point in that process boring holes in the ground,or seabeds to extract ancient plant and animal material will either run out or become cost INEFFECTIVE as other alternatives evolve to replace fossil fuels.

A great example is the Central America discovery and salvage. The "ship of gold" that foundered off Hatteras in a storm in 1857with most of the San Francisco mints gold production.

Before the salvage operation a mint state 63 1857 S double eagle was a $40,000 coin.
After the salvage operation the value of that coin had dropped by 90% +. That's what happens when a very limited supply is overwhelmed by a "new discovery".

Have we reached the threshold of that event with oil? Probably not, but you can bet all of the percieved wealth of future oil extraction will depend on the perception of available reserves, which is controlled by organizations whose incentive is obviously a perception of rarity.

I think the current total production, from the first drop until today. the 169 cubic miles would cover the planet in a layer less than1/4 inch deep, even though we drill many miles underground for the product, a product which the world population would have been much different without, both financially and geopolitically.

Those who control the dissemination of information have a powerful incentive to CREATE a perception of rarity. If you swallow THEIR propaganda, you will pay a heavy price.

Much like the victim of a robbery who reports the theft as many times more than it actually was, knowing that the thief will never be trusted even if caught, takes advantage of even that situation for more financial gain.

regards
mech

[sendler]

Originally Posted by Old Mechanic

All the "sky is falling" fear mongering is basically a money grab

Really sorry to hear you talk this way.
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It will be possible to transition to a fossil fuel free existence. And we could probably do it fairly seamlessly. If we start now and pull out all the stops. Similar to the focused labor effort in the USA during WW2. It takes 100 years to make this radical of a change to the world wide infrastructure and economy.
And it takes a huge amount ICE powered machinery to mine the resources and build the Giga factories that are needed to build this new world of alternative energy.
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If we really wait and do business as usual for the next 75 years until the then diminishing crude oil supply pushes these projects out of reach there will be a crash and a big correction.

[NeilBlanchard]

We didn't leave the Stone Age for a lack of stones; nor did we stop using whale oil for a lack of whales.