<TH: Participation is Necessary...(or Syriana is an opportunity...)The Oil Drum

92 comments on Happy Peak Oil Day?

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Luis de Sousa on November 24, 2005 - 4:43am Permalink | Subthread | Comments top
Happy again!

I almost forgot it. Remember that since October and till the end of December, OPEC is officially producing flat out.
If so and May is still the highest month...
Two and two makes what?... ah, five!

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timdrive on November 24, 2005 - 4:01pm Permalink | Subthread | Parent | Comments top
Actually OPEC has over 1 mbpd spare, plus inventories keep building which means demand is less than supply. I will not be until 2007 when we will noticeably get short. Unless of course next hurricane season gets as bad as this year's.

Cheers,

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peakearl on November 24, 2005 - 6:19pm Permalink | Subthread | Parent | Comments top
Inventories are not necessarily building. Last week, the small build in commercial inventory was matched by a drop in SPR. Inventories dropped the week before with SPR flat. We stayed afloat the last 3 mos by utilizing European inventory plus 16 million barrels of SPR (which led to half the commercial inventory build). This, coupled with an abnormally warm fall during a time of typical slack demand anyway gave the appearance of business as usual. Now that US & Europe are having real weather and refineries are producing again we will see.
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Luis de Sousa on November 25, 2005 - 3:55am Permalink | Subthread | Parent | Comments top
Well, even if that's the case (which I don't believe to be), remember that all spare capacity available is from one state alone, Saudi Arabia. Most important of all is the quota system being suspended, meaning that OPEC has lost control of prices.
The same happened with the Texas Railroad Commission when the US-48 peaked.
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ABAPer on November 25, 2005 - 6:25am Permalink | Subthread | Parent | Comments top
And all spare capacity is heavy man... sorry...

It effectively cannot be used to fill the gap because refining capacity does not exist for it... We could well see rising inventories with rising prices and the lead time on new refining capacity is in years...

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Engineer-Poet on November 25, 2005 - 8:34pm Permalink | Subthread | Parent | Comments top
Well, let's see.  Declining gas production is going to leave a lot of GTL plants with nothing to do.  If syngas-sweetening systems aren't too slow or expensive to add, maybe that heavy crude could be turned straight into diesel fuel by gasifying it, scrubbing the nasties and liquefying via F-T.

Unfortunately, that process appears to be only about 63% efficient (see page 37).  We'd need a lot more heavy crude than light to do the job; about 1/3 more for gasoline, almost 1/2 more for diesel.

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