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179 comments on DrumBeat: May 20, 2007
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179 comments on DrumBeat: May 20, 2007
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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
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.
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.