Most Americans aren't likely to make big cuts in gasoline use

"In many ways, this is an insurmountable problem. There is no simple solution to get people to change their driving," says Nick Epley, psychologist and assistant professor of behavioral science at the University of Chicago Graduate School of Business.

"People adapt to all states of affairs, positive and negative, and more quickly than they think," he says. "If gas were to go up from $2 a gallon to $3 overnight, we'd be up in arms. But it goes up a couple of cents each time you go to the pumps, and pretty soon it's $3 and, 'Yeah, that's what gas costs.'

"And conservation of any kind is tough for people to take. It requires losing something, cutting out part of their lifestyles," he says.

The thieves are using a factory-issued key to open gas pumps and reprogramming a keypad inside the pump so the sales do not register on the station's computer system. That allows people to pump gas for free. To make it easier on service technicians, each manufacturer's pumps can all be opened using a common key.

"It's definitely an expert or a person who knows what they are doing," says Riaz Ahmad, owner of a station in Baltimore that got hit a month ago.

Employees at Ahmad's station noticed gas was missing when taking inventory. But it wasn't until they started to notice long lines for pumps nine and 10 -- located the farthest from the cash register and near the street -- that they figured out what was going on, Ahmad says.

He guesses those responsible for deprogramming the pump were telling friends or selling gas at a discount and collecting cash near the pump.

Ahmad lost 2,800 gallons in five days at a cost of $8,100, not including lost profit. He recently added new locks and security cameras at a cost of $3,200.

Also, on the other side of Africa a major Australian oil company- Woodside- is under invstigation for bribing (facilitation payments!) of ex-Energy Minister in Mauritania, and payments of 4100 million to new government.

It will be interesting to see what happens when one of the dictators decides to nationalize one of China's oil ventures?

The number of wells drilled on new projects in the North Sea reached a six-year high in 2005, with some significant finds providing evidence of the potential of the province, according to sector specialists.

...With oil and gas firms making or progressing discoveries containing more than 700 million barrels oil equivalent, Jim Hannon, co-founder of the consultancy, said the activity levels confirmed there was plenty of life left in the North Sea. Initial reports indicated some sizable discoveries had been made.

"Contrary to popular belief, the report shows the North Sea had a tremendous year for reserves found and appraised," he said.

Hannon Westwood reckoned that finding costs averaged $1 to $3.60 per barrel, "in the right range" to compete internationally for funds.

As a relative newbie, I've been thinking lately about the best ways to introduce the unaware to Peak Oil. I know from experience that getting people to understand things is non-trivial and "telling it like it is" has a surprisingly dismal success rate. Case in point: my own introduction to Peak Oil came in 2004 when I stumbled upon LATOC. I could not make it through the long article and as soon as thermonuclear energy was mentioned I gladly left the page, thinking "well, there is at least some hope." I only returned late last year to see what was new, and found TOD. A site like this is much more bearable than LATOC since it eases the gloom by communication, different opinions and considerable expertise.

Still, TOD is but a microscopic stain on the Internet and the issue is even more lost in the wider world. Spreading awareness remains IMHO the most relevant task for this community and so, if you don't mind, I would like to start a small, informal contest for The Ultimate Peak Oil Soundbite. The challenge is to write a description of Peak Oil with the following properties:

• minimum length (let's say a soft limit of 100 words?)


• simple language


• factual tone (ideally something even JD wouldn't have a problem with)


• modest scope (i.e. ethanol debunking should happen elsewhere)


• encouragement to find out more (this should be a teaser, if you like)

A senior economic official said Monday that Russia would have a domestic petroleum exchange -- an idea backed by President Vladimir Putin last week -- up and running by year's end, but experts doubted whether oil would trade internationally in rubles anytime soon.

Deputy Economic Development and Trade Minister Kirill Androsov, who is also a Rosneft board director, said a domestic exchange for oil products would begin trading by the end of 2006 and an international exchange that would sell crude oil sometime in 2007, RIA-Novosti reported.

The losers this time will be the foreign creditors, the people with savings and on fixed income. With every penny the dollar depreciates billions of wealth evaporates - which means the government will not have to repay it, the workers will be getting increasingly worthless paper as paychecks and their 401K plan will be headed down the drainpipe.

The silver lining is that if (when) the dollar collapses energy will become too expensive in the US. Impoverished people will not be able to pay for 10-20$ of gas and will start pressing the government to make the structural changes needed to prepare us for PO - build rail and mass transit, encourage urban pattern and conservation etc. US will probably lose its international dominance, but the almost forgotten innovative spirit that built this country will be awaken and will lead us to the new world... whatever it is :)

I have two articles so far, one on Australia's commodities boom (which is being used as a justification for tax cuts...) and one on the recent APPEA conference and Australia's declining oil supplies. New content will be added regularly.

My links section is quite bare but will be gradually filled, feel free to make suggestions, particularly to any Australian sites.

http://energyfutura.blogspot.com/

A few years ago, roofing asphalt sold for about $200 a ton. Now it's going for $600 a ton and more, said Barry Saifman, a manager at Murton Roofing in Miami.

"I've never seen it where the materials we use -- cement, liquid asphalt, gas -- are all under siege."

Garry Szyndlar, president of Taycon Construction Management Inc. of Palm Beach Gardens, said the price for a ton of copper has more than doubled, to $7,800, in the past two months.

Source

DTE Energy Idles Synthetic Fuel Production

DETROIT, May 15 PRNewswire-FirstCall -- DTE Energy today announced it idled production at all nine synthetic fuel (synfuel) facilities operated by the company.

The decision to idle synfuel production was driven by the current level and volatility of oil prices and the lack of federal legislation that would have provided certainty for production economics this year.

Synthetic fuel production may resume, depending on various factors, including a reduction in oil prices or the enactment of potential federal legislation. DTE Energy retains production flexibility that could allow it to make up lost production during the remainder of 2006 if the current shutdown remains limited in duration.

The company is maintaining its operating earnings guidance, excluding synfuels, of $2.41-$2.66. Previously, the company provided earnings guidance of $3.60-$3.90 per diluted share, which included $1.19-$1.24 of synfuel earnings per diluted share. However, given the uncertainties around the amount and timing of synfuel production and the ultimate value of the related tax credits, the company is not providing synfuel earnings guidance at this time.

DTE Energy holds a majority interest in two of the nine synthetic fuel production facilities and minority interests in the remaining seven facilities. Synthetic fuel facilities chemically change coal, including waste and marginal coal, into a synthetic fuel as determined under applicable Internal Revenue Service (IRS) rules. The production and sale of synthetic fuel produced at these facilities generates production tax credits under the Internal Revenue Code.

The value of these credits is dependent on the full-year average price of oil for the year in which the credits are generated. While the full-year average price of oil cannot be known with certainty prior to the end of the year, current high oil prices suggest that credits' value could be partially or fully phased out for 2006.

Legislation was proposed in Congress for inclusion in the recent tax reconciliation bill that would have impacted the potential phase-out of production tax credits for 2006 and 2007. However, this provision was not included in the reconciliation bill as enacted.
The proposed legislation is under consideration for inclusion in subsequent legislation, such as the "extenders" bill. If included and enacted as proposed, then there would be no phase-out of tax credits for 2006 and DTE Energy could resume production at the synthetic fuel facilities it operates.

RR

NEW YORK (CNNMoney.com) - Wal-Mart signaled Tuesday that it's clearly worried that higher gas prices could both eat into its sales in the months ahead and add to the overall cost of running its business.

In a pre-recorded call to discuss the Wal-Mart's (Research) first-quarter results, CEO Lee Scott said the company could "continue to see higher utility costs impact customers around the world" and pressure [results] in the second quarter.

Moreover, Wal-Mart said higher energy costs will likely pressure the backend of its business in the form of higher operating expenses and transportation costs.

Industry experts have warned that low-to-mid-income consumers - Wal-Mart's core shoppers - first feel the pinch from rising gas prices, ultimately cutting back on trips to the store and spending less once they get there.

Hedge funds play major role in gas price hikes

How readers would fix the energy crisis

They're for drilling all over the U.S., building nukes, expanding ethanol and developing hydrogen. Check out their suggestions and how I plan to explore their ideas.

Thanks to the 839 readers who sent me their recipes for fixing the supply side of our national energy "problem." I've never gotten so much e-mail so quickly in response to any column.

In my May 9 column "My 4-point plan to cut U.S. energy use," which solved the demand side of the current energy crisis, I asked for your suggestions on how to tackle the other half of the problem by expanding supply. And, boy, did you all respond.

I don't agree with everything that readers suggested. But, as I said in my column, we're brainstorming here. So, following the time-honored rules of brainstorming, I, acting as facilitator for the group, am going to present your ideas without editorial comment. (We'll save the trash talk for a later round.)

I've grouped them together by topic because, it turns out, most of your solutions to the supply-side of the energy crisis fell into six major categories:

continue reading at MSM Money

I like the tone of the article, and the author wants to expand it: he will write a follow up on ethanol in mid june:

The first topic: Ethanol. So send me your data and your Web sites and let's see if we can figure out exactly how much energy and money it costs to produce a gallon of the major types of ethano

http://www.fredericknewspost.com/sections/news/display_detail.htm?storyID=48929#postComment

FREDERICK -- Thousands of Frederick County's so-called "McMansions" could be back on the market in coming years as deadlines on interest-only loans come due, mortgage payments skyrocket, and homeowners' pocketbooks are stretched to the breaking point.

Home assessments have skyrocketed in Maryland especially in metropolitan areas -- home values are up 60.3 percent over last year, Ms. Jackman said. As assessments increase, so do property tax bills.

When the principal payments come due, combined with other economic burdens -- higher property tax bills, increases in utility bills, $3 or more for a gallon of gas, mounting interest rates and rising day-to-day expenses -- it may be more than some families can bear.

A flood of vacant houses "is one possible outcome," said Thomas Shaner, executive director of the Maryland Association of Mortgage Bankers. "I don't want to say it couldn't happen. It absolutely could happen, and that kind of stuff worries everyone."

Silly me - I thought it would be high oil prices that would cook this goose.

Hail Satan!

"The IRS audited 41 credit counseling agencies and revoked the tax exempt status of most.  The remainder voluntarily surrendered their tax exemption.  The IRS contended that the credit counselors were improperly funneling individuals toward profit making debt management affiliates.  The 41 agencies generated 40% of the industry's revenues.  Under the new bankruptcy laws that came into effect in October, an individual intending to file chapter 7 must receive credit counseling before filing the petition.  In the absence of approved credit counseling, the judge must dismiss the petition."

...there was an article in the print edition of Lithuania's largest daily ( http://www.lrytas.lt ) on May 12, page 9:

BEGIN
Poland wants to join the Baltic countries intending to build a new atomic power station in Lithuania. The head of Poland's atomic energy agency, Jerzy Niewodniczansky, said that it would be ideal if Poland's first atomic power station were built in Lithuania, at the existing atomic power station in Ignalina. According to him, participation in the project would not only provide Poland with cheap electricity, but also an opportunity to train Polish personnel for a future atomic power station to be built in Poland.

The Polish government last year approved a new energy strategy, in which it is planned to build Poland's first atomic power station by 2020.

The heads of the leading Lithuanian, Latvian, and Estonian energy companies signed a memorandum of understanding on March 8, regarding preparations for construction of a new atomic reactor. The preliminary estimated cost of the project is valued at about 3 billion euros. It is thought that the new reactor could be built by 2020, and would solve the shortage of electric production capacity that is expected in the Baltic countries after 2015.
END

Important background note: the existing reactor at Ignalina (Lithuania) is scheduled to be shut down at the end of (if I remember correctly) 2009. Big gap there between 2009 and 2020...yikes! Hmmm, maybe I better accelerate those plans to put up a small windmill and a few solar panels...

http://www.morganstanley.com/GEFdata/digests/20060515-mon.html

Stephen S. Roach has a piece on "Commodity Bubble". His basic idea is that the current commodity boom is largely based on the flawed notion that China's future path will look like the path it has followed for the past 27 years. Doesn't mention Peak Oil, but he tiptoes around it at the very end:

"From China to the "end of oil," perfectly plausible stories of the new era abound."

I recommend this -- I disagree with his conclusions, but he states his case better than most others I have seen.

Also, Serhan Cevik has a piece, "Petro-Bubbles", covering his Middle East and North Africa beat. For U.S.-based readers, some of what he writes might be news. Worth a look, I would say.

This bit of news caught my eye:

"The Iowa Renewable Fuels Association (IRFA) reported that the collective output of the state's ethanol facilities is expected to equal the amount of petroleum-based gasoline that Iowans use. Fuel consumers in Iowa have burned about 1.5 billion gallons of fuel in their vehicles in the past year, and annual ethanol production for 2006 should reach 1.6 billion gallons."

Nebraska and South Dakota are close on Iowa's heels. 26 US states now have ethanol plants.

This was interesting too:

"The kingdom (Saudi Arabia) opened its Haradh expansion facility on March 22, which increased crude output capacity by 2.7 percent to 11.3 million barrels a day. The facility is the latest addition in a five-year, $14 billion program to boost production capacity almost 14 percent to 12.5 million barrels a day in 2009."

Oil production will drop one day but who cares? New liquid fuels + Efficiency gains=peak oil is a non-event. It will happen and no one (with a social life) will care.

Rep. Roscoe Bartlett is on C-SPAN 1 talking about PO:

www.c-span.org/watch

Excerpt:

One agribusiness giant is enthusiastic about using farmland to produce fuel. Another says growing food should be the top priority for those fields.

Archer Daniels Midland Co., by far the country's largest ethanol producer, has taken an aggressive approach to biofuels including ethanol and biodiesel. Cargill Inc. has been more restrained, though it's hardly sitting on the sidelines.

Recent comments by the chairmen of both companies mirror a larger debate taking place on how big of a contribution ethanol can make toward reducing America's need for oil imports, and whether using more corn to make more fuel will lead to higher food prices.

Minnetonka-based Cargill ... chairman and CEO Warren Staley, told a gathering of business writers here that he saw producing food as the most important task for agriculture. ... "We have to look at the hierarchy of value for agricultural land use: food first, then feed and last fuel."

Staley questioned whether subsidies for using land to produce fuel were good long-term policy ... Even if the entire U.S. corn crop were used for ethanol, it would replace only about 20 percent of domestic gasoline consumption, he said.

The next day, the chairman of ADM, G. Allen Andreas, responded by insisting the world has plenty of capacity to grow food.

Some will call it impossible, impractical and silly. Some will reject it since it would require action and commitment from all able bodied citizens of the US.

I could share my idea here yet before I do I would like to see if anyone cares to read it? It would be a fairly long read and require some realizations to be made. For me the main thing is that to type this will take me a while and if at least a few people are interested then the time is well spent. I think?

A quick summery would be something along the lines of, "Today all poverty ends, all citizens have their own homes, we use the land efficiently and there are no more bills!"

Let me know in replies if you are open minded and willing to participate in a truly democratic family based future that could start a global trend....

Regards

How many of you have investments?

How many of you have a job?

A good job?

How many of you own a car, two cars, own property?

How many of you have a family?

How many of you have an education?

How many of you are worried about loss?

Profit and Loss.

Supply and Demand.

Peak Oil.

Climate Change.

Economic collapse.

Are you religious?

How big is your penis?

Why is TOD here?

Say hello to Hugo, GWB.