DrumBeat: May 24, 2007
Posted by Stoneleigh on May 24, 2007 - 7:00am
Topic: Miscellaneous
What's the meltdown price for uranium?
Add another certainty to death and taxes: Barring some sort of nuclear catastrophe or an instant, massive influx of new supply, the price of uranium oxide is going to continue its shocking rise for now.
The question for the fissile metal's producers, and for investors seeking to cash in on the gains, is how high can it get before its key nuclear power plant consumers defer plans to add reactors, or try to cut consumption at existing plants, as they wait for much delayed new mine supplies to come on stream and bring the price back down?
Since bottoming out at just $7 (U.S.) a pound in December, 2001, the "yellowcake" spot price has climbed almost exponentially, hitting $40 a pound about a year ago and a startling $120 a pound last month. This means it is very close to shattering the record high of $43 it hit back in 1979, which, adjusted for inflation, is the equivalent of $122.42 today. Already, some producers are predicting it could rise to $250 some time next year.
A new study says growing demand for energy, coupled with price increases, has led to consistent growth in Canada's oil-and-gas sector over the past 10 years.
The Statistics Canada study says the oil-and-gas sector contributed more than $40 billion to Canada's gross domestic product in 2006, while sector employment increased at a somewhat faster pace than the national average.
Total employment in all oil-and-gas industries amounted to roughly 298,000 in 2006, a 22 per cent increase from 1997, while the general economy expanded at a 20 per cent pace.
Employment in oil-and-gas exploration, extraction and production increased at three times that pace, about 65 per cent, to roughly 177,000 from 107,000, with 75 per cent of the jobs in Alberta.
The impact on wages was pronounced: In 1997, employees in oil-and-gas extraction earned 58 per cent more per hour than the average worker; by 2006, this gap had widened to 80 per cent.
House approves stiff gas-gouging penalties
The House, eager to do something about record high gasoline prices in advance of the Memorial Day weekend, voted narrowly Wednesday to approve stiff penalties for those found guilty of gasoline price gouging.
The bill directs the Federal Trade Commission and Justice Department to go after oil companies, traders or retail operators if they take "unfair advantage" or charge "unconscionably excessive" prices for gasoline and other fuels.
The White House called the measure a form of price controls that could result in fuel shortages. It said President Bush would be urged to veto the legislation should it pass Congress.
GE Unveils First Hybrid Road Locomotive
GE today announced the debut of its one-of-a-kind hybrid road locomotive at its Ecomagination event in Los Angeles. GE's Evolution® Hybrid locomotive will be unveiled tomorrow, May 24, at LA's historic Union Station to demonstrate the progress that GE's Transportation business is making in developing a freight hybrid locomotive that is capable of recycling thermal energy as stored power in on-board batteries.
This demonstration hybrid unit will be one of many technologies featured at the Ecomagination event that are developed and used in the rail industry to reduce smog-causing emissions, including Nitrous Oxide emissions, and particulate matter. Ecomagination is GE's initiative to bring to market new technologies that will help customers meet their most pressing environmental challenges.
How to Shift our Transport Paradigm: Learning from Grenoble
In a recent article for Raise the Hammer, I described the impressive public transport system the city of Grenoble (France) has developed over the last twenty years.
Its centrepiece is a modern streetcar network, but it has also included extensive re-engineering of the streets to make them friendlier to pedestrians and cyclists.
The Saskatchewan Budget and Resource Royalties
In all the discussion of the budget by our politicians and media commentators, no one has brought up the major issue of revenues from resource extraction. Without capturing a fair return from the extraction of our resources, most of which are non-renewable, we cannot pay for the government services we desire. In the past when we had good services, we also had higher royalties, fees and taxes on the extraction of our resources. The cuts in resources royalties and taxes have been welcomed by the transnational corporations that extract these resources, but they have left the province with a high debt and diminished services.
Oilpatch workers rake in the pay: study
As the energy sector booms in Western Canada, workers in the oil and gas sector are commanding 80-per-cent more in wages than the average Canadian employee, a gap that has widened more than 20 per cent in the past decade, a new study shows.
Statistics Canada reported Wednesday that total employment in all oil and gas industries was roughly 298,000 in 2006, a 22-per-cent increase from 1997, slightly faster than the average of 20 per cent for the economy as a whole.
In the upstream component of the sector, which covers oil and gas exploration, extraction and production, employment increased at three times that pace, or about 65 per cent, from 107,000 to roughly 177,000, the study added. Three-quarters of the jobs were in Alberta, with its vast oil and gas reserves, the report said.
Gas price spike longest on record
The 11th straight day of record high gas prices Wednesday resulted in a new measure of pain for the nation's drivers -- the longest stretch of time with gas above $3 a gallon, according a closely-watched daily survey.
And relief is no where in sight heading into the Memorial Day holiday that marks the start of the summer driving season. Prices continue to rise in most of the country, as the Midwest saw prices soar a nickel or more a gallon in one day in several states.
Federal gas tax freeze causes cash crunch
A cash crunch is fast approaching for the government trust fund that pays to build and repair highways and bridges.
The federal tax on a gallon of gas has not risen in 14 years and Congress is reluctant to increase it. People are demanding more fuel-efficient vehicles -- less gasoline used, fewer dollars for the fund.
BG sees progress toward Gaza gas deal with Israel
A deal would have a significant impact on the Palestinian government, which is in the middle of a cash crunch. It would result in $100 million a year in taxes, royalties and equity.
The Times newspaper reported that the group was poised to agree the terms of a $4 billion deal to supply gas to Israel, with representatives from the British energy firm scheduled to meet Israeli negotiators next week.
Libya to unveil gas round details
The country has held three oil exploration licensing rounds since the end of Western sanctions, awarding permits to companies keen to secure a foothold in one of the world's last under-explored oil regions.
There is increasing interest in Libya's underdeveloped gas sector, including the potential for liquefied natural gas, following several recent discoveries.
Iran continues to defy UN on nuclear programme
Iran continues to defy UN Security Council demands to scrap its uranium enrichment programme and has instead expanded its activities, the International Atomic Energy Agency (IAEA) said yesterday in a finding that sets the stage for new council sanctions.
Ahmadinejad faces backlash over plans for petrol rationing
Iran is to introduce petrol rationing in two weeks in a move that belies its status as the world's fourth-largest oil exporter and threatens to trigger a popular backlash against its president, Mahmoud Ahmadinejad.
The country's motorists - used to some of the cheapest fuel in the world - will be restricted to three litres a day under a scheme to cut fuel consumption and reduce the burden on Iran's struggling economy of providing subsidised petrol.
Russia has learned to use its vast natural resources to exert power in Europe and beyond. This week, just ahead of a testy bilateral summit with the European Union in Samara, its clout was enhanced by Mr Putin's crude but effective diplomacy in Central Asia. He persuaded Kazakhstan and Turkmenistan to send more gas exports through Russia, spoiling the rival plans of America and Europe for a trans-Caspian pipeline that would skirt south of Russia. Ms Rice's comment that "no one needs a monopoly" in natural resources will merely bring smiles to the faces of Kremlin officials.
Just before Ms Rice's visit, the Kremlin's rumbustious anti-American rhetoric hit new peaks. In his speech on Victory Day (May 9th), Mr Putin seemed to liken America to the Third Reich. "The victory once again will be ours," Russia's state television channel echoed.
Europe's Energy Giants Call For Business As Usual With Russia
Europe's three largest natural gas companies called Wednesday for greater political support for increased business ties with the Russian energy giant Gazprom, saying growing tensions between Moscow and the European Union should not be allowed to jeopardize energy security.
The blunt assessment from Eni of Italy, Gaz de France and E.ON Ruhrgas of Germany came as the Russian president, Vladimir Putin, arrived in Vienna for a state visit a week after the collapse of an European Union-Russia summit meeting. Putin raised the energy issue himself, praising Austria as a model partner, but failed to win support for setting aside political differences.As E.U. and Russian leaders continue to disagree, the bloc's big energy companies are making their own deals with Gazprom. With Russia as Europe's most important supplier of natural gas - demand for which is expected to rise sharply over the coming 10 years - officials at an energy conference in Berlin, sponsored by the Russian Gas Society said both sides had an interest in increasing energy security.
Russian regulator: BP may lose license on gas field
BP PLC's license to develop a giant Siberian gas field could be revoked in days, Russia's environmental watchdog said Tuesday, as pressure mounted against one of the last major foreign-controlled energy projects in the country.
Losing its license to the Kovykta field would be a painful blow for BP PLC since the company has appeared conspicuously eager to court favor with the Kremlin, which has aggressively expanded state control over the world's biggest oil and gas industry.
Analysts suggest that official complaints over production quotas at Kovykta will fade just as soon as an acceptable deal is struck that gives control of the project to state gas monopoly OAO Gazprom.
Such a conclusion would mirror Gazprom's entry to the giant Sakhalin-2 liquefied natural gas development off Russia's Pacific coast, observers say, where Royal Dutch Shell PLC was elbowed into a minority position.
Wind, wave and solar power targets will not be met, says White Paper
The Government has admitted it is likely to miss its own targets for renewable power generation. Problems with incentives to energy generators, planning curbs and difficulties connecting renewable power to the national grid mean Britain will not be getting 20pc of national energy consumption from renewables by 2020.
Britain ‘will run out of power’ unless it takes nuclear option
By 2023 all but one of the nuclear power stations now in operation will have reached the end of their predicted lifetimes, as will a number of fossil fuel power plants, leaving Britain with an estimated shortfall of up to 35 gigawatts in capacity within two decades.
Gas boom reinforces Burmese junta's defiance
In recent days, Burma's military junta has been bombarded with calls to free Aung San Suu Kyi, the Nobel Prize-winning democracy advocate who has been detained, mostly under house arrest, since May 2003.
But with natural gas sales filling the junta's coffers and cementing its ties with powerful, energy-hungry neighbours, analysts and diplomats say the generals feel under little pressure to act.
The government's carbon Greenplan
"The British government is proud to announce the creation of Green-plan. As our energy white paper, published yesterday, makes clear, the only way to tackle climate change is central schemes and targets for everything from light bulbs to biomass. We need a Low Carbon Transport Innovation Strategy. We need a succession of five-year plans. We need Greenplan, modelled on the old Soviet economic planners at Gosplan, to take control."
Or almost. Yesterday's white paper contained some sensible - if rather vague - stuff about energy security and a new generation of nuclear power plants. But it also contained plans, some decided by the European Union, to micromanage exactly how and where carbon emissions will be cut.
Paris set to rethink GdF-Suez merger
France's newly appointed government said yesterday it might rethink plans tocreate a new European energy champion through the merger of state-controlled Gaz de France with Suez, the quoted French utility.
Wall Street closes lower on China worries
Greenspan said he feared a "dramatic contraction" in Chinese stocks after the recent boom, adding the run-up was "clearly unsustainable."
The comments come almost three months after a sharp drop in Chinese stocks on concerns about speculative investments triggered a global equity rout.
NAFTA Superhighway Has Giuliani As Key Player
But the SPP is cleverly disguised as a boon for all three North American countries and its citizens, yet has lacked input or oversight from federal, state, or municipal legislators nationwide. The goals of the SPP agenda largely include a call for transparency and unprecedented cooperation with respect to all three governments’ commerce and trade. The endeavor is to join forces in uniting as one competitive body in the global marketplace and to function as the North American Union (NAU), which at the same time whittles away at each country’s sovereignty, its national security and its laws.
Speed of subprime bust surprises lenders
The subprime mortgage meltdown has been a shock to industry insiders, but now they say it's hitting harder and faster than expected - even to those who predicted the crisis in the first place.
That was the message Monday from a panel of leading industry executives on the state of the mortgage lending industry at the Mortgage Bankers Association's National Secondary Market Conference & Expo in New York.
Michael Marriott, a panelist and managing director for Credit Suisse, said, "Last October, I predicted the subprime market would collapse and many issuers would go out of business. But the violence and speed of the market sell-off surprised people."
David Lowman, a panelist and chief executive of JPMorgan Chase & Co.'s global mortgage business, said, "35 percent of what once could be done, can no longer be done," referring to mortgage loan products that have effectively been taken off the shelves.
And speaking separately from his Atlanta office, Duane LeGate, president of House Buyer Network, a specialist in short sales and foreclosure prevention, said one of the real estate agents he works with had six deals blow up within four days because, "The loan originator told him, 'We're not offering [these products] anymore.'"
According to LeGate, this kind of thing just started to happen in the past month or so.
Derivatives Say Bernanke Will Be Wrong
Derivatives are something of a financial accounting anomaly. Since they are traded between parties (Over-The-Counter), holders do not have to use mark-to-market accounting (assigning value based on current market price). To quote Warren Buffet on derivatives:
"...there is no real market and "mark-to-model" is utilized. This substitution can bring on large-scale mischief. As a general rule, contracts involving multiple reference items and distant settlement dates increase the opportunities for counter-parties to use fanciful assumptions. The two parties to the contract might well use differing models allowing both to show substantial profits for many years. In extreme cases, mark-to-model degenerates into what I would call mark-to-myth."
A hedge fund manager that I have been discussing this with said: "None of these guys mark to market even though there are no question big losses. The CDO's (Ed Note: Collateralized debt obligations based on credit derivatives) are held by hedge funds, insurance companies and foreign banks etc. Once these CDO's start getting downgraded or hedge funds that own this paper get redemptions and are forced to sell, then things will start to get ugly."
China is being cast as the villain once again. By holding its exchange rate artificially low, it is stealing jobs and causing the United States to run a huge trade deficit. Beijing must therefore be forced to revalue the yuan. These are the arguments behind an increasingly protectionist mood in Washington. Yet they are largely flawed. A stronger Chinese currency would not much reduce America's trade deficit. Indeed, the irony is that China, not America, has more to gain from setting the yuan free. Without a more flexible exchange rate, there is a growing risk that China's sizzling economy will boil over.
Make That a Cheap Money Bubble to Go
"The current wave of Gulf money, driven by an oil boom that has seen oil prices peak at $78, has been on a different scale," says Kerr. The late 1970s was the last extended period when borrowing cash made you richer than saving it. Now real rates of interest - on the Dollar, Sterling, Euro, Yen and Swiss Franc - sit near to zero again.
Throw the Chinese Yuan into the mix, and is it any wonder oil prices have trebled in the last half-decade? The flood of money is simply washing back whence it came.
"Thanks to huge trade surpluses in Asia and massive oil revenues in Saudi Arabia and Russia," reports Reuters today, "sovereign wealth funds designed to maximize returns on part of a country's currency reserves have blossomed in recent years."
"The 13 biggest funds manage assets totaling of $2.1 trillion, according to estimates by Lehman Brothers," says the newswire, "potentially allowing them to exert hefty influence on global asset prices."
China and Blackstone, Perfect Bubble Buddies
There is something wondrous and symmetrical of one bubble (China) making an investment in another bubble (private equity). Of course, there are numerous bubblicious precedents that went awry.
Guardian at the Gates: Surging Toward War With Iran
If you have any doubt that the Bush Administration is planning a military strike against Iran, then check out the lead story in today's Guardian: Iran's secret plan for summer offensive to force US out of Iraq. The story, which based entirely entirely on the unchallenged statements of three anonymous "American officials," not only alleges that Iran is "already committing daily acts of war against US and British forces" including the increasing mortar attacks on the Green Zone but also asserts that Tehran has entered into an active military alliance with al-Qaeda. Together, this new axis of evil will launch a "nationwide, Iranian-orchestrated summer offensive" aimed at undermining the scheduled September progress report from U.S. General David Petraeus on the vaunted "surge." Oh, and to top it all off, the same officials told the Guardian's stenographer, Simon Tisdall, that Iran has now also allied itself with its long-time enemy, the Taliban, and are helping kill Americans in Afghanistan as well.
To reiterate: the claim now from "top Bush officials" is that Iran has entered into an alliance with al Qaeda and is "committing daily acts of war" against American forces. As a casus belli, this beats the hell out of an "imminent threat" from undiscovered WMD, the entirely specious charge used by the Bush Faction to gull the nation into aggressive war with Iraq.
Zimbabwe: The last person to leave may not have any lights to turn out
Power cuts are already frequent, but the latest blackouts mark a new low. Residents of Harare, the capital, have been rushing to get firewood and paraffin, though a domestic worker's monthly wage can buy only five litres (1.3 American gallons) of paraffin or two litres of cooking oil. Many companies, already operating at about 40% of capacity, say the cuts will force them to reduce their working hours even more. "The whole thing is a nightmare," says Lovemore Mandebvu, who runs a small furniture-making factory in Harare. "We don't know when we will have power and when it goes. This is affecting our output. Then at home water runs out when you are bathing, and the electricity goes while you are cooking." Hospitals must use gas stoves, coal-fired boilers, fuel generators, solar power and candles.
With water consumption outstripping supply in both Israel and the Palestinian territories, Palestinians say they are always the first community to be rationed as reserves run dry, with the health problems that entails.
Not surprisingly, during the era of Arab-Israeli peacemaking in the 1990s, water rights became one of the trickiest areas of discussion.
Climate change could put Canada's Arctic whales in hot water
The report, released Tuesday by the World Wildlife Fund, said global warming is likely having the same effect on whales that it's having on polar bears - changing the conditions under which they are adapted to live.
"It is unclear to what extent cetaceans will be able to adapt to the rate of climate change predicted in the near future," says the report.
"As temperatures increase, there are likely to be significant losses of polar 'specialist' species and a general shift of more temperate species towards the poles."
Canadians not prepared for financial sacrifices to tackle environment, survey says
Canadians have no doubts about the existence of global warming, but they are still reluctant to make financial sacrifices or alter certain lifestyle habits to save the environment, a Finance Department report warned just prior to the 2007 federal budget release.
The recently released executive summary titled Focus Groups for Budget 2007 advised the Harper government that, in the short term, Canadians wanted more information and a sense of what the country was doing in response of the environmental crisis.
"As part of this, they want some direction in terms of what they can do to help. Although, on this last point, the research indicates that at this point Canadians are reluctant to sacrifice either financially or alter certain lifestyle habits for the sake of the environment," said the summary.
Scientists Concerned About Effects Of Global Warming On Infectious Diseases
As the Earth's temperatures continue to rise, we can expect a signficant change in infectious disease patterns around the globe. Just exactly what those changes will be remains unclear, but scientists agree they will not be for the good.
"Environmental changes have always been associated with the appearance of new diseases or the arrival of old diseases in new places. With more changes, we can expect more surprises," says Stephen Morse of Columbia University, speaking May 22, 2007, at the 107th General Meeting of the American Society for Microbiology in Toronto.
Big Oil money doesn't go over well down on The Farm
Stanford University has found itself caught squarely in the middle of a major proxy battle between a group of New Jersey nuns and the world's largest privately owned oil company.
The university, which has been heavily criticized for taking up to $100 million from ExxonMobil for climate and energy research, is poised this week to vote in favor of the nuns' proposal that the oil giant immediately reduce its greenhouse gas emissions contributing to global warming. The vote would fall in line with the university's policy to support proxy resolutions addressing climate change.
Local MSM is reporting that the Public Service Commission will allow Baltimore Gas & Electric to raise energy rates 50%:
Everyone likes that deck chair quote.
http://www.examiner.com/a-745318~PSC_formally_OKs_BGE_rate_increase.html
So far, no one seems to be tying the rise in gasoline prices to the increase in natural gas & electricity prices. They're just playing the blame game.
When I read this I couldn't help but associate it with this: http://www.wtop.com/?nid=25&sid=1143112
Call it fascism, call it Continuation of Government, call it a police state, call it what you will, the declining resource base shall lead to a restriction of freedoms just as the expanding resource base allowed for their broadening.
May 17, 2007 - 10:33am
BALTIMORE - Alarmed by the city's growing homicide rate, a Baltimore City Council member wants to give the mayor the power to put troubled communities under a virtual lockdown that some critics equate with declaring martial law.
The measure, proposed by City Council Vice President Robert W. Curran, would allow the mayor to declare "public safety act zones," allowing police to close liquor stores and bars, limit the number of people on city sidewalks and halt traffic. Police would be encouraged to aggressively stop and frisk individuals in search of weapons and drugs. And the sale of weapons within the zones would be prohibited.
Zones would be established only by the mayor, for two week periods, although they could be renewed indefinitely, under Curran's plan.
"It is possible the talks could lead to deals for U.S. companies that make the "scrubbing" equipment to reduce pollutants from coal, which China relies on heavily. There were also discussions on other power sources, like nuclear energy AND ETHANOL WHERE U.S. FIRMS HAVE PRODUCTS TO SELL."
http://www.cnbc.com/id/18810591
The US selling Ethanol to China would be equivalent to Stalin dumping grain on the world market while millions in the Ukraine starved.
http://www.ukrweekly.com/Archive/1988/458814.shtml
Already, Ethanol production has caused increases in food prices that the working class in the US can ill afford.
There are ominous signs on the horizon with regard to US food supply. Our agriculture is commoditized and up for sale to the highest bidder. China could literally buy the food right out of our mouths.
http://www.canada.com/nationalpost/financialpost/printedition/story.html...
Instead we should be imposing a food export ban on corn and corn products such as ethanol to ensure food security for own population in the future. Market control of US Agricultural Products will see our own people starve as our food supply is exported to the highest bidders worldwide. A dark and ominous evil.
Why not?
It has been done before:
The food continued to be exported to England from Ireland during the Potato Famine
http://en.wikipedia.org/wiki/Irish_Potato_famine#Food_exports_to_England
Food exports to England
Records show Irish lands exported food, even during the worst years of the Famine. When Ireland experienced a famine in 1782-83, ports were closed to keep Irish-grown food in Ireland to feed the Irish. Local food prices promptly dropped. Merchants lobbied against the export ban, but government in the 1780s overrode their protests; that export ban did not happen in the 1840s.
Food was similarly exported from the Ukraine during the Holodomor in the 1930s. Several million people died of starvation.
"Even indispensible seed grain was forcibly confiscated from peasant households. Any man, woman, or child caught taking even a handful of grain from a collective farm could be, and often was, executed or deported. Those who did not appear to be starving were often suspected of hoarding grain. Peasants were prevented from leaving their villages by the NKVD and a system of internal passports."
http://www.ibiblio.org/expo/soviet.exhibit/famine.html
I can see it now:
Chinese Merchants ordering US National Guardsmen to gain access to Kansas farm grain hoppers...
Maybe this is why the right to bear arms is taken so very seriously in the US...
Actually, in the US it would just go straight from Big Agriculture to the holds of foreign ships. No peasants to take it away from, just US consumers who will find little on their shelves to buy and nothing they can afford.
Yes, I suppose that is true.
Still, the runaway nightmare of one of the most heavily armed civilian populations tolerating starvation as staple crops ship overseas is not likely. I think by that stage, the USA would have ceased to exist as a functioning system anyway.
Pretty academic really. As peak oil, water, soil etc all begin to bite simultaneously, globalisation will be replaced by resource nationalisation as each region is swamped by its own problems and no other region can come to its aid.
But one way or another, the days when North America was the worlds bread basket are coming to a close.
I don't think there is any question about that. One of the things that they drum into you at the Land-Grants, is that America's agricultural productivity owes to chemicals and mechanization. Take that away, they tell you (as in "organic farming") and it's "bye-bye" grain exports. Here, we face a future in which we are not only wondering where the diesel fuel and agri-chemicals will come from, but we are in the process of retooling our ag systems (still dependent upon that diesel and those chemicals) so that we can run our cars and trucks on the harvest.
And to steal from Simmons:
'When American Grain peaks, the worlds grain peaks'....
Cid, it Looks like there's to be a route for that grain to travel:
Todays Drunbeat:
> NAFTA Superhighway Has Giuliani As Key Player
Gee sure looks good to me. Will Giuliani be the new Moses to part the seas? :>)
They get the foods you get the goods!
This sounds like the greatest single mis-allocation of resources in human history. At least the Great Pyramid of Cheops became a tourist destination, albeit unintentionally.
What goods will ship in 20 years time?
What will go down the pipes?
Is there enough asphalt and concrete in the world?
The nomads will be able to use it 100 years from now for migrations.
Or Aliens, coming to our system, to find out why the radio waves have stopped.
They will see it from space.
Hi env atty:
I doubt it. The road surface will be too hard on feet and hoofs.
You are absolutely right!
My family left the Ukraine earlier, my grandfather was born in Canada in 1900. Growing up behind the "Garlic Curtain" in Saskatchewan (high Ukrainian population) and then later living in Winnipeg, the impression that I got was that it was all about working on the collective farms. The peasants that were too stubborn to give up their land had their crops confiscated. I never got the impression from anyone that it was genocide, they wanted the Ukrainians to farm the collective farms, not to kill them. The way that I understand it, crop failure compounded the whole situation and people that agreed to farm on the collectives ended up starving too. Total freakin' mess. I don't remember any anti-Russian sentiment from Ukrainians, except from my aunt who married one. :-)
I used to work at Land Titles and we had a Ukrainian delegation come to study the legal system and software a few years ago. I haven't heard how the whole private land ownership is going there, but it was slowly moving forward at the time.
As John Mellencamp put it:
Well there's people and more people
What do they know know know
Go to work in some high rise
And vacation down at the Gulf of Mexico
Ooh yeah
And there's winners and there's losers
But they ain't no big deal
'Cause the simple man baby pays for the thrills, the bills,
the pills that kill
The peasants that were too stubborn to give up their land had their crops confiscated. I never got the impression from anyone that it was genocide, they wanted the Ukrainians to farm the collective farms, not to kill them. The way that I understand it, crop failure compounded the whole situation and people that agreed to farm on the collectives ended up starving too. Total freakin' mess.
It was all just a "freakin' mess", like the supermarket was a freakin' mess last week when they were giving out free donuts? Let's hear what the person responsible for this particular "mess" which led to the starvation of millions of Ukranians has to say about all this:
I didn't mean to make light of the event or Stalin's accountability for it. I don't have any relatives in the Ukraine that I know of because of it. I just meant that my impression was that it was forced communism, bureaucracy and bad crops that killed millions. It doesn't make Stalin a better person however they died, but my opinion was that he was trying to ram communism down on the Ukrainian peasantry and a lot of people died.
The National Post story was the headline on the DrumBeat two days ago - I agree it's definitely food for thought, so to speak.
Climate: The food chain's weakest link
http://www.marketwatch.com/news/story/climate-us-food-chains-weak/story....
Fears over food price inflation
http://www.ft.com/cms/s/7f8bccb8-0960-11dc-a349-000b5df10621.html
But... but...
What will we adjust inflation for, if we have to remove food we already subsidize?
Panic.
I've kind of been waiting for the right moment...
We will be applying an across-the-board %8 to %10 increase to our menu at our two family-owned coffee houses here in California. Although we've been tracking numerous wholesale price increases for the last six months, (often attributed to energy and transportation cost increases up the supply chain), it's the precipitous rise in dairy prices fueling our retail price hikes. The record corn price is the reason first given to explain the hike in dairy prices nationwide.
The WSJ had an article last week about rising dairy prices and large food producers (Kraft, Dean Foods, even Hershey's), and corn ethanol was cited as a driver.
Eight to ten percent is steep IMO. And inflation is at %2? Yeah, right...
WHAT A PILE OF CRAP CYAMA!!
Your diatribe is utter nonsense and a complete waste of everyone's time.
If it weren't for me, I'm sure this garbage thread that you've started would continue for the entire day, taking the intellectual integrity of this forum down with it.
FYI...
On May 3rd, Mr. Paulson was at Harvard where he elaborated on some of the ongoing trade issues he has dialogued with the Chinese Vice Premier.
The following is a recap of what he had to say when it came to the topic of ETHANOL:
"Since he came to Washington last year after a long career at Goldman Sachs, Paulson said, “I haven’t found that many of the problems, as I’ve looked at them close-up, look easier. But the area where I’ve received the most good news is spending time at the Department of Energy and with others, and learning about some of the technologies we’ve got coming.” He cited cellulosic ethanol as an example.
Both China and the United States need alternative sources of energy, Paulson said. “We’re talking a lot about sharing technology.”
Low and behold, 3 weeks later, the big meeting is over and Paulson reiterates the above. Simple enough... one would think.
That is until I log on to TOD today and find Yama's expert analysis on the subject at hand wherein ethanol becomes corn ethanol - corn ethanol becomes export ethanol (do that math on that one) - export ethanol becomes the Holmodor.
THE HOLMODOR!
ARE YOU FREAKING INSANE??!!
How many months Yama? How many months will I have to spell out for you that the word 'ethanol' is not some all-encompassing designation?
Better yet...
When are you going to get it through your head:
That corn doesn't feed people -it feeds animals- animals that certainly don't end up on the dinner plates of the starving masses in this world.
That corn -GM corn specifically- shouldn't even be eaten, let alone fed to animals: http://projectcensored.org/censored_2007/index.htm#11
That the teeny tiny increase in the price of cornflakes, cheese doodles, coca-cola and all the other processed garbage that makes up the North American diet is nothing, ABSOLUTELY NOTHING compared to what Peak Oil is going to do to the price of that mmm...mmm delicious, 10oz Cloned Cefquinome steak.
According to Manning's "The Oil We Eat", it takes approx. 10 calories of petroleum to produce 1 calorie of industrial food (sans transportation no less) and yet, everyone keeps harping about corn prices.
Well the joke's on them isn't it TODers? Little do they and the corn price scarmongers realize the true nature of what we face, of what's down the bend?
Then again... the following is but one of the first MSM inklings of what should soon be a flood of related 'lightbulb' moments:
Gas Prices May Increase Cost of Food
http://www.wlns.com/Global/story.asp?S=6562269&nav=0RbQ
Yes, Yes, Syntec, We here all know you as a Mouth for the Ethanol industry on TOD. The man behind the curtain you don't want anyone to see is this:
The issue is not what particular crop is used to make Ethanol. The issue is the conversion of food producing ACREAGE to ethanol producing acreage. Less food producing acreage = higher food prices. Higher food prices lead to demand destruction. Where food is concerned, demand destruction = starvation. Anyone promoting conversion of food producing acreage to ethanol producing acreage is promoting malnutrition and starvation among the poorest segments of our population who will be 'priced out of the market' for food. That won't just be a problem for the poor. Malnutrition among a growing segment of the population can lead to pandemics the will affect the population as a whole. Politically, Look to the Russian Revolution and the French Revolution. Both were the result of economic decisions made that resulted in reduced food supply. Next time you put Ethanol in your tank, think of the child who is going hungry so you can do that. Next time you make a profit on ethanol, think of the people who are going hungry for you to make that profit. Ethanol profits are blood money.
Prove it Cid. Prove your ridiculous blood money assertion. Come on.. show me the data sets that support your argument that ethanol (which for the umpteenth time, can be derived from any carbonaceous material) is the ominous evil you proclaim.
Would ethanol produced from landfil or MSW take up your precious acreage?
Would ethanol produced from the 13 million hectares of beetle infested forest cause a run on wheat futures?
How about ethanol derived from nitrogen-fixing DECs that could be grown in crop rotation with the cereal crops?
Or the stranded NatGas deposits in the WCSB, would ethanol from this source starve people?
Yeah.. that's what I thought.
Here's your response. Cellulosic Ethanol cannot meet an EROI to be profitable. In the US, commercial Ethanol is made from corn. The acreage for that corn is taken away from acreage previously used for food and livestock feed. Ethanol production in the US has already caused an increase in US food prices. But you know all this.
http://www.theoildrum.com/node/2580#comment-194163
No significant ethanol, if any, is produced by your sources (13 million hectares of beetle infested forest, nitrogen-fixing DECs, landfills, etc.).
In the US, it is produced from corn. Elsewhere, sugar. These DO compete with humans for food.
Alan
Excellent graphic re: long term and regional gasoline price trends at the NY Times
http://www.nytimes.com/ref/us/20070524_REFINERY_GRAPHIC.html
Just long-term trends (Gas was above 3 dollars real in the early 1920s, briefly in 1980-81, and NOW), plus regional variation by state. Nicely presented though.
Nice graphs. Welcome back.
Gas prices are even higher in Michigan than in Ohio. Very strange. Michigan always had relatively cheap gas prices in the past.
In Toledo, gas was $3.48. In Lansing, it's $3.63. (I'm expecting it to go even higher as the holiday weekend approaches, based on past experience.) This was the front page headline.
It was only $.3.07 in New York, which is usually more expensive. I guess the states near the refineries and the ports are going to have an advantage as the fossil fuel fiesta winds down.
Gas prices are even higher in Michigan than in Ohio. Very strange. Michigan always had relatively cheap gas prices in the past.
May be something to do with the 50% cutbacks in throughput at BP's Whiting refinery (near Chicago) - one of the three biggest in the country. Related to safety issues and ongoing upgrades for Canadian heavy IIRC. That's 1% of US refining capacity standing idle right there.
http://www.bp.com/liveassets/bp_internet/globalbp/STAGING/global_assets/... PDF - Sorry - GOTO last paragraph on Page 2
OT: Welcome back Leanan.
Hope the holidays were good :)
Sounds like she's seeing the USA in her Chevrolet!
Since last summer's vacation was involuntary, we'd been batting about what to do for a better vacation this summer. I was first inspired by a Ped Shed article to take the train to Quebec City. Then we were going to drive to a Delaware beach, but I hate that Bay Bridge. Then we were going by train to Charleston SC. I took the bike out to Inner Harbor yesterday and realized that we've hardly scratched what Baltimore has to offer. So we're staying here with perhaps a day trip to DC. My only rule is that I am not going to get stuck looking for parking spaces.
I'm still gone. Or I never really left. :-)
My schedule doesn't allow me to put the DrumBeat up while I'm on vacation, but I'm still checking in from time to time.
I think states and cities near refineries will have a definite advantage, its one of the reasons I like Galveston, Texas for the post peak era.
Also workers in refining, oil exploration and oil production should have an exemption in any rationing/allocation scheme.
High gas prices in Michigan? I think of it as poetic justice.
BTW, you're slumming in Michigan?! Are you cra.... Terribly sorry, the previous poster has been hauled away. We would like to thank you for coming to wonderful Michigan to spend your tourist dollars. Lord knows we need someone's dollars to keep this state afloat.
I hope you're going on to Lake Michigan. At least the coast is pretty. They actually put up with bicyclists over there. We'll be taking the kids there in a few weeks.
Take a look at GasBuddy.com's gas price temperature chart. I suspect we in Michigan are being heavily affected by the two BP refinery outages that Stuart mentioned in his latest article.
I met a local. Who is a peak oiler. She hangs out at LATOC, I gather.
She talked about some of the budget problems Michigan is having. They are talking about laying off the state workers and shutting down the state. o_O
It's not just Michigan.
Goto this site and do a find on Michigan.
Pension Tsunami
The rules changed about reporting Pension Obligations on the Balance Sheets for Cities, States, etc.
They have to show future obigations of their Pensions on their finanical reportings.
Think of it, Some towns, and counties have retired DPW workers, firemen, etc retiring with full Salary pensions for life.
All leveles of goverment will be bankrupt in 5-10 years.
Goto the above site and do some reading.
The problems ain't way out in the future.
They are now.
I read somewhere (not that website) that only Florida and North Carolina have fully funded state retirement accounts -- that's 2 out of 50.
Yep, one thing at least we don't have to worry about here in NC. For a southern state we really are pretty progressive in some respects.
BTW, do you think you'll vote for Richard Moore for gov?
Far too early yet to even begin following such things. Check back with me later.
Lots of the states are having budget problems for a number of reasons. Entitlements, diminishing returns and increasing complexity, huge costs of replacing infrastructure, natural resource exhaustion, neo-liberal economics, looting by political class, growth, federal costs - that's the short list here in Maine.
Direct energy/entropy costs are pretty low on the list, but indirectly, they are the cause. We've run out of the low-hanging fruit everywhere.
cfm in Gray, ME
Off topic: Interesting 1976 video clip of Hubbert.
http://www.youtube.com/watch?v=ImV1voi41YY
From the sublime...
to the ridiculous: Peek oll DE-bunked in for minnits.
http://www.youtube.com/watch?v=JW0ERdgkwBA&NR=1
I think that was the funniest thing I have ever seen in my entire life.
What a joke!
He's too funny !
I was particularly moved by the musical score.
That thar liberal media establishment wants you to "squeal like a pig"
Here I thought deliverence was just a movie...
Watch this ABC TV documentary (Australia) on how our oil addiction will bring us straight back to the Jurassic:
Crude - the incredible journey of oil
http://abc.net.au/science/crude/
From the food on our tables to the fuel in our cars, crude oil seeps invisibly into almost every part of our modern lives. It is the energy source and raw material that drives transport and the economy. Yet many of us have little idea of the incredible journey it has made to reach our petrol tanks and plastic bags.
Coming in the wake of rising global concerns about the continued supply of oil, and increasingly weird weather patterns, Crude spans 160 million years of the Earth's history to reveal the story of oil; from its birth deep in the dinosaur-inhabited past, to its ascendancy as the indispensable ingredient of modern life.
Filmed on location in 11 countries across five continents, the program's award-winning Australian filmmaker Richard Smith consults the leading international scientific experts to join the dots between geology and economy and provide the big-picture view of oil.
Crude takes a step back from the day to day news to illuminate the Earth's extraordinary carbon cycle and the role of oil in our impending climate crisis. Nearly seven billion people have come to depend on this resource, yet the Oil Age that began less than a century and a half ago, could be over in our lifetimes.
http://www.abc.net.au/tv/documentaries/stories/s1928967.htm
You know, I've viewed probably every piece of film shot having to do with peak oil for my classroom, and this is overall THE best documentary I have seen. I can't praise this enough.
It's "scientific" without being stuffy or overly-technical. It's fast-paced without being too "MTV". (They do use any and every excuse they can to show dinosaur reenactments.)
It takes us from the carbon atom being snatched into the earth's sedimentary basins during the Jurassic, to that same carbon atom being released in the present as fossil fuel emissions. It's comprehensive, intelligent -- and will properly scare the shit out of people.
Get them to watch it.
Yup. From the meta-information on this video:
| The problem will solve itself.
| But not in a nice way.
I still smoke. And drink. And eat red meat.
Hitler,Himmler, Mussolini and Franco were all avid non smokers.
Three of them were also fanatical non alcoholic vegetarians.
They were also into the production of a clean, sanitised master race. They stopped Aryan baby producers (formerly known as German Women) from all of these vices. Lest it corrupts the jungend.
They came up against:
Churchill (smoker, drunk)
Stalin (smoker, drunk)
Roosevelt (smoker)
Guess who won?
'Sometimes, when in government, the best thing you can do is take a nap in the afternoon'. - Churchill
I didn't write that, it's the quote from the video. Anyway, he never said that the drunks don't hit anything. Just that they still take to the wheel.
And it won't be the peak oil that kills us ... it'll be the inflation, famines, riots, insurrections, wars, tyrannies and so forth. Oil shortages will just be a backdrop to the history of the next 50 years.
| The problem will solve itself.
| But not in a nice way.
But what do you smoke?
With WTI at $65.90 and Brent at $71.14 this morning I was wondering whether the US may again be an exporter of crude oil to Europe. To those in the refining industry, could this be done? It seems to me that backlog in Cushing could
be sent by pipleline to tankers and shipped to buyers in Europe. Seems to me I read somewhere the two crudes were very similar in gravity, etc.
I have thought for several months now, as a futures trader, the spread between WTI and Brent would narrow making this a sure thing trade but at the moment it appears to be widening instead of a narrowing. At the moment, the idea of oil as a fungible commodity is possibly in question.
The above prices are futures quotes, maybe someone could supply the cash prices.
As I understand it: if the pipelines were there that could handle the flow you describe, the price differential wouldn't be nearly so large.
Bloomburg Energy Prices
Right now the gap in the spot price is greater than the gap in energy prices. As I write this the Brent spot is $72.00 while the WTI spot price is $64.44, a spread of $7.56.
WTI spot does not track the WTI futures for the first three days after the expiration of the contract. The June contract expired Tuesday so for the rest of this week the July futures contract will likely be slightly higher than the spot.
It would make no sense to export oil from the US to Europe. We import and they import. The exporting nations could just divert oil headed to the US to Europe. Which is exactly what they will do if this European premium continues.
Insidently the Tapis premium is even greater. I don't have a daily quote for Tapis but the last time I searched I found the price of about one month ago. At that time Tapis was trading at about a five dollar premium to Brent.
http://omrpublic.iea.org/Prices/Cr_MA_05.pdf
Ron Patterson
Hi Ron,
$7.56 is more than a barrel of oil was selling for in the early 1970's. If I bought futures contracts for WTI and sold Brent contracts I could take physical delivery at Cushing and transport it to Rotterdam to satisfy physical delivery on the Brent. Question is how much is it going to cost to get it delivered. I bet it is being done right now and at a lot less than $7.56 a barrel.
Dang! Just gave away another sure-fire moneymaking idea.
This seems like an absolutely enormous spread to me. A $7+ spread?! One would think that a tanker headed for the US would simply turn around to sell their crude on the Brent spot market. Some tankers hold a million barrels. So how is it possible that they wouldn't just turn around for a quick 7 million dollar profit? Is it because they already agreed to sell to the US before they left shore?
Hi bobi.
You wrote "...With WTI at $65.90 and Brent at $71.14 this morning I was wondering whether the US may again be an exporter of crude oil to Europe. "
My understanding is that it has been illegal to export petroleum from th US since about 1970 (equal volume "swaps" are excepted).
My take is that "Free Trade" is whatever the Big Boys say it is.
How big is that total parking area, you said? 2 billion parking spots ,....
The problem to the problem is that it is too huge to spot - not possible to zoom eigther ...
I have a feeling the problem is the "blue-stuff" in the sky.
BTW - US seems to have a lot of spare gas tucked away - in the shape of parking lots ..
Are these lots part of the strategical-reserves ?-
"They paved Paradise and put up a Parking Lot" (!!!)
Yes, there are 8 parking spots for every car. But while 7 of them are empty, everyone keeps circling around waiting for the one closest to the front door to open up.
No sh*t, nothing describes 99% of us better.
But that's OK, those of us that take the one furthest away just for the hell of it will not have much of a problem.
Book of the Void.
Wow. That is a lot of m2. I would say 10 m2 (9' wide by 20' deep, about 3m x 7m) per parking spot, 400 000 000 000 m2, or 400 000 km2... ¡¡¡That is about the size of Spain!!! That cannot be.
I come up with 40,000 sq km.
I come up with 40,000 sq km.
According to the "guru of parking" Donald Shoup, there are 325 parking spaces per hectare. Two billion parking spots equals 61,000 km2, if my calculations are right. That's between Switzerland and Ireland in area.
From the Earth Policy Institute:
(NOTE: they give a minimum number of parking spots per vehicle of 3. That seems really low. I'd say the 8 number in the article is probably right.
Hence, their overall numbers seem low. Multiplying by 2 might be the way to go. Research from 10 years ago already suggested that total paved over area in the US was the size of England. But I'm too lazy to look it up or do more calculations.)
Total parking area = 19200 km² = 7413.161 mi²
Total paved over area= 160.000 km² = 61.776 mi²
That analysis uses the 1999 figure of 213 million vehicles in the U.S. As of 2005 there were 241 million vehicles registered in the U.S., so the figure in the article cited above of 250 million vehicles in 2007 is probably fairly accurate.
Just as a thought experiment.
50,000 km2 area covered with 20% efficient solar cells collecting 6 hours a day and allowing for 20% cloud cover yields an average of 200GW. This is roughly 40% of the electrical power needs of the US.
Just as a thought experiment.
50,000 km2 area covered with 20% efficient solar cells collecting 6 hours a day and allowing for 20% cloud cover yields an average of 200GW. This is roughly 40% of the electrical power needs of the US.