DrumBeat: May 20, 2007

Oil Price ‘Gouging’: A Phantom Menace?

On Tuesday, the House Energy and Commerce subcommittee on investigations plans a hearing into evidence of possible price gouging and other market manipulation by oil companies.

The chairman of that hearing will be Representative Bart Stupak, Democrat of Michigan, who has introduced a bill that would define price gouging as a price that is “unconscionably excessive” or that “indicates the seller is taking unfair advantage of unusual market conditions.”

The Zero-Energy Solution

Mike Strizki’s house, the house of the future, the revolutionary house that might very well change our lives forever, is an unremarkable two-story, 3,000-square-foot, white colonial-style kit home in front of which, one rainy day last November, were parked no fewer than seven trucks and cars, a pair of Jet Skis, a speedboat on a trailer, several golf carts, a small tractor, a couple of vans and an old dump truck rusting in the middle of the woods, like a major reworking of a Robert Frost poem. There was nothing odd, or futuristic, or exotically “eco” about the house — no solar panels to be seen, no giant arrays of thermopane windows passively drinking up light and heat; yet here, I’d been told, in the Sourland Mountains in New Jersey, an hour from Manhattan, was a house that had the potential — not long from now, not 20 years from now, but maybe within 5 to 10 years — to help turn millions of American homes into fully self-sustaining power plants, each one capable of producing hydrogen to fuel cars as well.


Motorists will dig deep this summer

Member states of OPEC are fast joining ranks to thwart recent moves by industry and pressure groups in North America and Europe to open the valves.


Record high gas run continues

Gasoline prices hit their record high for the seventh straight day Saturday, as gas costing less than $3 a gallon is becoming a rare find anywhere in the country.


Oil pricing - between devil and deep blue sea

Global crude oil prices are rising once again. And once again developing countries like India are going to be the worst hit. Consumers in this country may have to face hikes in the prices of petrol, diesel and cooking gas in the coming months if the situation does not ease soon in world markets. Indian public sector oil companies are already gearing up to make a case for a price hike to the government, which ultimately takes these decisions.


Gore's Inconvenient Truth required classroom viewing?

First it was his world history class. Then he saw it in his economics class. And his world issues class. And his environment class. In total, 18-year-old McKenzie, a Northern Ontario high schooler, says he has had the film An Inconvenient Truth shown to him by four different teachers this year.

...McKenzie says he has educated himself enough about both sides of the climate-change controversy to know that the Al Gore movie is too one-sided to be taught as fact.


Media Ignore European Energy Politics to Advance Global Warming Alarmism

One of the issues on the table was whether Russia is going to provide more energy resources to EU nations starved for such.

Didn’t hear about this?

Well, that’s not surprising, for in the midst of the media’s ongoing attempts to create global warming hysteria while pushing the U.S. to participate in the Kyoto Protocol, our press have little interest in reporting how energy politics across the Atlantic and Pacific oceans are threatening economies around the globe.


Renewable energy: The tide turns

Senior cabinet ministers are pushing for Britain to be the first nation in the world to get much of its power from the tides, as part of a massive new expansion for renewable energy. The Environment Secretary, David Miliband, Welsh Secretary Peter Hain and Trade and Industry Secretary Alistair Darling want a giant £14bn barrage to be built across the Severn.


Variety review of The 11th Hour:

True to its doom-laden title, global-warming doc "The 11th Hour" presents the viewer with reams of depressing data, loads of hand-wringing about the woeful state of humanity and, finally, some altogether fascinating ideas about how to go about solving the climate crisis. Co-produced and narrated by Leonardo DiCaprio, this latest exercise in celebrity eco-activism lacks the personal touch that helped "An Inconvenient Truth" go green at the box office, but audiences might warm to its layered insights and polished presentation, given careful nurturing by Warner Independent and effective showcasing as an educational tool.


Pump paradox

With energy prices so high, what incentive do cash-rich oil-producing nations and multinationals have to increase supplies?


An interview with Rupert Murdoch about News Corp.'s new climate strategy

When Rupert Murdoch, the cantankerous and conservative owner of Fox News, enthusiastically joins the fight against climate change, you know we're past the tipping point on the issue. Think landslide.


Are high gasoline prices un-American? Maybe not

"The only way one can effectively address this problem today and get an immediate kick is by raising the price at the pump and keeping it there," economist Philip Verleger told New York Times columnist Thomas L. Friedman. An additional tax of 50 cents to $1 a gallon would give the government cash to buy back the most fuel-inefficient vehicles on our roads. "The best monument to 9/11 we could erect would be a mountain of crushed gas guzzlers," Verleger says.


Taking on High Gas Prices in California and the Oil Industry

I went to a freeway-adjacent Chevron Station in LA ($3.49 a gallon for regular) this morning to hear Assembly Speaker Fabian Nunez talk very tough about the oil and refining industries: “Skyrocketing gas prices are hurting California families and jeopardizing our economy. During the electricity crisis a few years ago California adopted ... measures to keep energy companies from using these convenient shutdowns to amp up their profits and today we’re going to make sure oil companies can’t use Enron-like tactics on California consumers.”


Sri Lanka: Higher and Higher

The plight of the consumer keeps getting worse with prices of gas, electricity, fuel and other items increasing day-by-day while a chain reaction has been set off by the depreciation of the Rupee.


Asphalt prices pave way for higher costs

The high price of crude oil has pushed up more than just the cost of filling up the family automobile with gasoline at the corner convenience store.

It also has forced up the cost of laying down pavement for new roads, filling in the potholes of aging parking lots or reconditioning a home's leaky roof with a new layer of three-tab asphalt shingles.


Thomas Friedman, commencement speaker at Rensselaer Polytechnic Institute

The situation is amplified by the rapid advancement of China, India, and the former Soviet Union, he said. As the citizens of these countries pursue their own versions of the American dream and look to purchase cars and furnish their homes with new appliances, Friedman said the global demand for energy will skyrocket at an unprecedented rate.


Jamaica: If we should find oil, then what?

Over the last three months, the Government has been hinting at the possibility of oil in the territorial waters of Jamaica. The Prime Minister, in at least one media report, was quoted as saying she wanted all Jamaicans to pray for the discovery of the precious commodity.


Boosting Penn Valley Park’s drawing power

One of the most controversial aspects of Clay Chastain’s light-rail plan mandates the closure of all roads carrying through traffic in Penn Valley Park. That includes Broadway, carrying 23,000 cars a day.

No big deal, Chastain argues: Creating a large swath of “open, contiguous green space in the heart of the city” is more important than traffic flow. Green space, he asserted in an interview with The Star, is the “greater good.”


Freight train usage keeps rolling higher

The number of railcars transporting freight nationwide grew to 17,380,102 in 2006, up 1.2 percent over 2005, according to Tom White, a spokesman for the Association of American Railroads.


Getting in on the (under)ground floor

Earth homes are environmentally friendly and energy-conserving structures that are built with three sides covered by concrete and soil, using solar energy to heat and cool much of the home.


Energy Crisis: Biomass fuels likely to be just one step in the search for a solution

It isn't going to be easy, painless or cheap for any of us. We didn't just pretend not to hear the first warning bell when it sounded in 1973, we pretended that it was a call to an all-you-can eat buffet.


Fears over looming energy crisis in UK
The lights could go out in Britain within eight years as demand is predicted to outstrip supply.

ACROSS Britain, cities are plunged into darkness. In London, the Underground grinds to a halt, leaving panicked commuters stranded in oppressively hot carriages. In office blocks, lifts stop operating and the air-conditioning shuts down. Employees swelter in stifling conditions.

This is not the postapocalyptic vision of some film-maker, but a realistic scenario as Britain grapples with a looming energy crisis. The statistics are frightening. In only eight years, demand for energy could outstrip supply by 23% at peak times, according to a study by the consultant Logica CMG. The loss to the economy could be £108 billion each year.


The controversial British National Party is Ahead of the pack on Peak Oil crisis. They've been running a series on peak oil all week, including Eating up the oil reserves, A looming economic depression? and Building an electricity based economy.


Venezuela May Create Private Oil Drilling Company, Envoy Says

Venezuela, which this week announced plans to nationalize 18 oil rigs operated by international companies, wants to establish a Latin American oil and gas drilling corporation.


Erratic energy prices 'could hit world economy'

TOP finance officials from the world's eight wealthiest countries said yesterday that the global economy is on track, but warned that volatile energy prices could disrupt growth.


Peak Oil and the Inflation Lie

The selective use of core inflation is a cover-up that is routinely assisted by corporate media that, knowingly and unwittingly, promotes the illusion of a “growing economy with inflation under control, or non-existent”.


Consider all options to keep the lights on

We are facing a looming energy crisis that needs to be addressed immediately. Base-load generating plants can take years to construct, so we must begin constructing new facilities today. If we do not deal with this issue in a timely fashion, California-style rolling blackouts won't be far away. These are not just a nuisance; they can have crippling effect upon our economy and quality of life.


Oils well that ends

When will this foolishness stop? How long will the consumer keep getting shafted by the Arabs, oil companies, environmental "whackos" and the liberals who want to keep us in bondage and not resolve the energy crisis facing our nation? Well, I think I have a solution for solving our energy crisis.


Shell hit by ‘dirty’ Arctic oil furore

The world’s largest untapped oil reserves – in northern Canada – have become the new front line in the battle between environmentalists and the energy industry.


Peak problems: As height of oil production nears, people must conserve and change the way they live

Most of the world is not tuned into "peak oil" as a real and inevitable event. But peak oil, the moment when we can no longer, on a global basis, increase oil production may be here already or only a year or two away.

Is peak oil a big deal? Ali Samsam Bakhtiari, a respected oil analyst and past director of the National Iranian Oil Company, refers to it as "the most important event of the 21st century." His greatest worry is the continuing contraction in oil production after the peak, with annual production reduced by approximately 30 percent or more within 12 to 15 years after the peak.


Living green before their time

Almost 40 years ago, Morninglory commune took a zero-footprint path.

I can't help but feel a little short-changed by economists here in Oz who blame our high gasoline (petrol) prices entirely on US refinery capacity constraints. Surely a flat crude oil supply over the last two years has something to do with it? Here's how I reconcile the evidence:

From other comments, I accept that there is a degree of arbitrage between crude oil and refined products, so the two tend to move together (I'd love some examples of that arbitrage). That the US has a large spread between crude prices and refined products resulting in record refining profit margins reflects the reality of the refinery capacity constraints. But while refining margins have gone up, some arbitrage between them means that crude and product prices still tend to move in the same direction on a day-to-day basis.

But it can't all be about the refineries. The world is not producing or processing any more crude now that it was in 2005 and 2006. Yet refinery issues were not so much on the front pages then (apart from the mainly short-term impact of the hurricanes).

With flat production, what has happened is that demand has been quite comprehensively destroyed in large regions of Africa and other developing countries. The (smaller) refineries in those regions are presumably not set up to be able to export refined products to take advantage of US product shortfall, so they are running well below capacity because their economies cannot afford the price of crude oil.

The US is the only regional economy with insufficient refinery capacity for it's market so it goes to out to Europe and Asia for gasoline imports, forcing all the other refineries to run at maximum and buy more crude to enable that. But over the last two years it's really been a zero sum game. Consumption of oil and refined products has grown a little in Asia/Europe/America/Russia/Middle East at the expense of consumers in Africa and other poorer countries.

So refineries in the still strong consumption economies have had to out-bid the developing nations for access to a flat supply of the world's crude oil (thus $76 TAPIS oil price in Asia very close to last years record highs). And now the US is further bidding up the price of refined products to make up for their regional refining capacity shortage. Thus US$3+ gasoline which is pushing up product prices in the rest of the world.

Refinery capacity constraints in the US are real, but meanwhile some third world refineries are probably running below previous levels. The huge impact of flat oil supply over the last two years in driving up oil prices is being underestimated.

Appreciate development or criticism of this line of thinking.

cheers
Phil.

But it can't all be about the refineries. The world is not producing or processing any more crude now that it was in 2005 and 2006. Yet refinery issues were not so much on the front pages then (apart from the mainly short-term impact of the hurricanes).

Stuart is working on a post about this. From the data, most of the blame can be laid on oil prices. The recent run-up is primarily due to refining issues, but it came from a base that was established as a result of high crude prices. If you go back a few years, you can say that the run-up is about 70% crude price and 30% gasoline supply related.

Is there anything that Stuart is not preparing a post about!?

I look forward to it :-)

That 70/30 breakdown is very useful. I'm hoping to get some more press coverage here in the next few weeks and that's a great line to use up against the economists blaming it all on refineries.

cheers
Phil
www.aspo-australia.org.au

and another question.. what is total refinery capacity in the US against total consumption?

ie. what proportion of gasoline has to be imported?

Incidentally, that 70/30 analysis is mine. Stuart was coming up with some different answers.

To meet demand, right now we require roughly 1.3 million bpd of a total consumption figure of around 9.4 million bpd. In peak season, that demand number will go up to about 9.6 million bpd and the import number will need to follow (which also depends on how high refinery utilization goes).

I think I have decided to write a post on exactly why gasoline prices are rising. There are 3 factors to explore: Supply is down. Why? Imports are down. Why? And demand is up. I am doing a bit of research right now.

does it seem feasible to you that there may be refineries in africa and elsewhere that are processing less now than two years ago because local economies can't afford the price and because the refineries aren't fitted out for exporting products?

No doubt demand is down in many 3rd world countries. While we have been experiencing record demand here in the U.S., since crude production has been flat someone must be getting by with less.

Your question made me curious about refineries in Africa, so I poked around and found this:

http://www.mbendi.co.za/indy/oilg/ogrf/af/p0005.htm

In the 50 years between 1954 and 2004 48 refineries were built in Africa. In 1954 the first African refineries were built in Algiers (CFP/Total) and Durban (Socony/Mobil). These were followed by the building of Luanda refinery (Petrofina) in 1958, and refineries in Kenya (Shell/BP), Ghana (ENI/Agip), and Senegal (consortium), in 1963. In the 1960’s refineries were also built in Cote d’Ivoire, Gabon, Tanzania, Nigeria (Port Harcourt I), and Capetown. In the 1970’s, following nationalisation of the oil industry in many countries, several state controlled refineries were built, such as Arzew in Algeria, Warri in Nigeria, CORAF in Congo, and SoNaRa in Cameroon. A final burst of refinery building took place in the 1980’s, including refineries at Warri and Port Harcourt in Nigeria. Whilst there have been a number of modernisation projects since then, the only new refineries built in the past 10 years have been Khartoum in 2001, and MIDOR in Egypt in2002.

Even whilst refineries were being built, others were already being closed. In 1966 the Zimbabwe refinery closed due to sanctions imposed during the UDI period. Between 1980 and 2003 a further 10 uneconomic refineries closed permanently.

All the refineries are basically of the topping/reforming type, except for the 4 refineries in South Africa, 2 in Egypt, 3 in Nigeria, 1 in Cote d’Ivoire, and 1 in Ghana, There are also 3 Synfuel plants (coal and gas feedstock) in South Africa. The total active distillation capacity for the continent is around 3 million b/d (15 million mt/yr), an average of 79,000 b/d per refinery.

The largest refinery in Africa is the Skikda refinery in Algeria (300mbd), the second largest the Ras Lanuf plant in Libya (220mbd). In Sub Saharan Africa the largest are the Port Harcourt refinery I and II in Nigeria (210mbd), and the Shell/BP Sapref refinery in Durban (165mbd).

Be interesting to see some production statistics from some of the African countries, but I am not sure that information is readily available. We end up with anecdotal evidence.

I think this also opens up a big can of worms as the worlds crude supply gets heavy and sour.

All the refineries are basically of the topping/reforming type

This link seems very good.

The topping reforming refinery is what we consider a simple refinery. So this means many of the third world refineries are probably only efficient with light sweet crude.

The implication is these countries will not have the capitol to convert to complex refining and thus we should see the poorest nations suffer the worst since they are competing for light sweet crude or refined gasoline with America.

I think this is the reason that refined gasoline on the global market is in short supply its now cheaper for the poorest countries to import refined products then to run their light sweet refineries. This is probably what is driving the Brent price since its Nigerian light thats the key.
This will get worse as the production of light sweet declines.

Yet one more time it looks like the pressure that peak oil puts on the oil infrastructure will ensure that we will have serious problems well before the predictions of geologic peak based on capacity. So we have indeed in essence lost a bunch of refining capacity because of the peak of light sweet even though the total oil volume has not decreased as much.
Because of above ground factors such as this the effects of peak oil are advanced by 1-3 years beyond what a simple supply analysis indicates. Of course Nigeria is now the biggest exporter for the US over KSA so it seems we have no intention of letting the poorest countries even get the light sweet they need to sustain themselves. I think my musical chairs/russian roulette model is correct. We can't even handle the peak of light sweet crude.

"I am doing a bit of research right now."

If you didn't see it, I put a comment towards the end of yesterday's DrumBeat which may be relevant. High Asian demand for naphtha may cause problems for the US this summer as exports from Europe are sucked East. It's also interesting that Saudi Aramco has apparently informed Asian suppliers that it will be cutting supplies of naphtha in the second half.

For anyone who wants to make their own (eyeball) judgement on the relationship between WTI crude and RBOB gasoline, here is the chart. It'll take a few seconds to load, and once it has done so drag the left hand side of the time period bar so the chart extends out from the initial 200 days to 658 days. Then look at 2007 vs 2006.

Brent may tell a slightly different story.

that is a very interesting chart with a very large spread opening up since Feb this year.

if only we could do the same thing for Brent and TAPIS oil price, which i think would track regional gasoline prices a little more closely.

Go back clear through 2006 and you see the exact same pattern as we are seeing now - as summer driving season comes along, the price of gasoline climbs above the price of crude and stays well above or just slightly below til roughly early August when if falls well below crude again.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

... and how much of the rise is from the dollar decline (if any) ? Does that have an indirect effect on oil prices (since other currencies can bid more aggressively for oil than we can ?

CW
Global peak: 2007 - 2010
Global decline rate, Post peak: 2%
Economic response: Severe global recession, ~5 years, then slow recovery

Check out Bakhtiari's four phases of transition. Find it linked in this Byron King article at 321energy.

Bakhtiari's view of T1 is that worldwide oil supplies will remain almost constant during this initial phase. New discoveries and production that is now coming on line will just about compensate for the production that is lost due to depletion. But T2, T3, and T4 will be, as Bakhtiari puts it, "more turbulent phases."

cfm in Gray, ME

Yesterday's Drumbeat had an article about methane and dams. The article said that decomposing vegetable matter created methane in the reservoirs. It suggested that dam operators capture the methane. How?
Also, if there were no dam, wouldn't the vegetable matter decompose in the ocean, creating methane there?

I think the idea is that the dam kills dry-land vegetation that would otherwise survive and not evolve methane.

In some dam projects here in Texas, the builders clear the land before flooding it. With the vegetation bulldozed into heaps they burn it, releasing CO2 instead of CH4 (at about 1/20th the GHG effect).

I have also seen some older reservoirs with thirty- and forty- year old tree stumps sticking up out of the shallow end. Apparently it can take them quite a while to rot.

The problem will solve itself.
But not in a nice way.

Sure, dry land vegetation is killed but a lot of rivers have high levels of organic sediment that will collect against a dam, rather than flowing downstream. Normally, it would stay suspedned or get deposited onshore, being exposed to oxygen and thus able to aerobically decompose.

Piled at the bottom of the dam the process is very much like eutrophication of a pond or lake. Dead matter piled on top of dead matter seals out the oxygen, favouring anaerobic decomposition and methane production.

The only way I could think of capturing the CH4 would be to install piping much like in a landfill and let it seep into the pipes as it forms. But the sediment isn't so stable or dense and putting a hole in it to install a pipe may just release all the gas that is in there...

Unless it significantly reducing sedmimentation in the resevoir, as it may in very high BOD rivers, I can't see it being economical...

But it is a nice idea.

Sure, dry land vegetation is killed but a lot of rivers have high levels of organic sediment that will collect against a dam, rather than flowing downstream. Normally, it would stay suspedned or get deposited onshore, being exposed to oxygen and thus able to aerobically decompose.

Perhaps rather than blame that on the dam, there should be some effort to reduce the amount of organic matter going into the river upstream. If it's agricultural runoff or sewage or the result of logging, treat it at the source. Or at least affix blame to the source; IMO dams are one of the best sources of sustainable, renewable electricity.

The problem will solve itself.
But not in a nice way.

Leaves, branches, trees, organic-matter rich soil, aquatic biota -- much of what ends up in a stream is deposited there by natural forces.

I have not had time to read and review the article. Earlier work profiled a "worst case" reservoir. Large tropical reservoir with high organic matter and low flows most of the year (and short head > minimal power production).

Let undone was the question if the organic matter had not settled to the bottom of the reservior, where would it have gone (swamp gas is methane).

Atmospheric methane has a half life of seven years, carbon dioxide over a century. So the storng GHG impact of methane (which has doubled since the beginning of the Industrial Age) has to be adjusted for it's short lifespan.

However, methane > CO2, so methane is just an intermediate step. Biological source methane is just part of the natural carbon cycle though.

How much of the increased C02 is biological and how much is escaped NG ? C14 analysis should answer that but I could find no paper.

Human alterations of agriculture and land use could well be responsible for doubling average methane levels.

Best Hopes,

Alan

I skimmed this article the other day, and I believe also they might have been extrapolating from a worst case senario. I have no idea how they might capture this gas for power production.

With lakes and reseviors, there are a couple of very broad factors to consider wrt methane. Methane generally comes from anaerobic decomposition in the sediments. Primary (algal) and secondary production within the water body "rain" significant amounts of organics for methane production. Production and release of gases to the atmosphere is broadly influenced by location-tropic vs temperate, depth of the water column and degree of eutrophication of the water body. With sufficient oxygen in the water column, much of the released methane can be oxidized by bacteria. Tropical, shallow, eutrophic reserviors will be the worst for methane release to the atmoshere.

RE: "Or at least affix blame to the source"

Um, that would be us and our insastiably arrogant appetite to live beyond our earth based ecological means.

WRT to "IMO dams are one of the best sources of sustainable, renewable electricity." That depends upon what value one places on the viability of wild salmon (and other such river species) to live too.

The decimation of slamon runs in the Pacific NW (and elsewhere) to feed our electrical appetite is without a doubt. Me, I'd rather sacrifice such electrical generation than the free running rivers and abundant fish to eat that these damned rivers once allowed the reproduction and proliferation of.

That's the kind of sustainability that is more important to me, and IMHO should be to us all than powering our electrified human arrogance.

The methane dam issue just points out another unintended consequence of this folly.

"It was your skill and your science
That led you astray.
And you thought to yourself,
I am, and there is none but me."
Isaiah 47:10

Um, that would be us and our insastiably arrogant appetite to live beyond our earth based ecological means.

Yeah, that sounds about right, thanks.

As for the salmon, I thought there was a technofix in the form of salmon ladders around the dams. Though I don't live in the NW and don't have much of a feel for the damned rivers there.

The problem will solve itself.
But not in a nice way.

The ignorant Ocala, Florida editorial includes:

My proposal is that the president and Congress proclaim a national goal of developing an automobile that runs on hydrogen within the next 10 years or sooner.

It's already been done, you... retired Chrysler engineer. That's not the thing holding back the mythical "hydrogen economy".

He also rabbits on about "the Arabs, oil companies, environmental "whackos" and the liberals who want to keep us in bondage". News flash: "the Arabs" are #4 on the list of countries exporting oil to the United States.

http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/company_l...

I guess those evil Canucks and Mexicans and Nigerians didn't require special mention - or are they under the category of "liberals who want to keep us in bondage"?

What, you mean you haven't HEARD?

All the mirrors in America are broken.

Hey, you doomers! Yeah, you! Shell has a few words for you.

Ha...ya...they ran that add in my last Popular Science mag. I guess the "doomer" word is getting out in the public enough that Shell thought they had to respond. At least they are acknowledging there is actually a "debate" going on about the petroleum future. That's an improvement...right?

In a magazine I received yesterday, there was a dvd from Shell. It was a little movie about some shell geologist that invented something they call snake drilling which was supposed to allow for the recovery of millions of barrels of oil from small pockets around offshore oil rigs.

It was a weird thing for them to make. Probably not 1 in 100 people would actually watch it and it was about some relatively obscure innovation that will have no real impact on global production capacity. I guess it was just some fluff piece to try and show how smart shell employees are.

The shell geologist did make a matter of fact statement that all the easily recoverable oil has been used up. I thought that was interesting.

I thought SA had been using directional drilling for years? Has this not been used in most depleted areass to get the last stuff out, for some time now?

Knowledgeable people to the rescue. Who's been using directional drilling?

Marco.

Marco, not really. The US is full of fields that could be redeveloped using directional drilling and modern seismic imaging. Major oil companies and big independents can't make any money on that kind of production, their overhead is too high. Most directional drilling is being used on unconventional gas and in tight oil reservoirs, and the business just doesn't have enough rigs or personel for redevelopment prospects.

Not as long as they have billions to levy against us in a media war.

But Shell:
Does it scale?

"Say No to No."

Isn't that cute. A message perfectly tuned to the ears of a people who've never been denied anything.

Good luck, you chumps.

Sound bites...sound bites...sound bites...it is the tool of all advertisers and more recently politicians.

What would be TODs sound bite(s) so that we have some "catchy" phrases to pass along to the masses?

"Say Yes to Know" - Get in the know on the world petroleum situation.

Any others care to waste a lazy Sunday afternoon brainstorming?

Saying "No" to "No" is not the same as saying "Yes" to "Yes";

and because I say "No" to "Yes" frequently, it doesn't mean I necessarily say "Yes" to "No."

If Shell tells me "no" I can't have $1.25 gas to whom do I say "no" that isn't OK while they make record profits?
...just a question...

What an image problem - good luck!

I think everything they are trying to avoid will only hit harder if they don't diversify into holding/building rail. Hey guy's GM is up for sale (cheap). Drop the car/truck and get building light rail...

IMO, the entire auto industry is toast. But the first to go will be The Big Three. Even if hydrogen proves feasible, the problems that plague Detroit will still be problems -- high wages, legacy costs and shabby workmanship.

The next chapter in Planet Automobile is going to be the "ultra low cost car." These will be manufactured in places like China or Korea (or maybe even in North America, but not under Detroit's leadership). These cars will be the most affordable to the emerging middle class in the developing world and to the ever-sliding American middle class. Most likely, they will employ old technology -- the ICE -- but be cheap and economical to operate. Should hydrogen ever become "the thing" the same Chinese and Korean workers will build them.

When the average wage in Detroit = the average wage in Shanghai, Detroit will start