I'm feeling pretty good about peak oil response, even as solo drivers in their large SUVs look over at me disdainfully as I walk, or bike.
I'm optimistic because I think the central question has been answered: will people respond, or will they remain in denial?
We are seeing responses wall to wall. Now, some of those responses are stupid ("E85 Everywhere") but I'll take 'em. I figure the stupid ideas will drop out of their own accord. They are a little wasted energy, but there is your invisible hand, and creative destruction, in action. Heck, a few weeks ago commentators here were maligning the invisible hand for its inaction, and now it is off the stick:
A new index tracking the performance of a portfolio of US alternative energy stocks is set to be launched on Friday, among the first to focus on the relatively young and fast-growing sector.
The launch comes as high oil prices, geopolitical uncertainty and worries about climate change are generating growing investor interest in non-hydrocarbon based energy businesses.
"What people are seeing at their gasoline pumps reflects the global economy in which we live," President George W. Bush said last week. "I think we need . . . to encourage conservation, to expand domestic production and to develop alternative sources of energy like ethanol."
I agree... I too am surprised by the amount of response. I thought it would take $5/gallon gas before we saw this.
Hopefully, gas prices will stay high enough in the near term to get people to make more permanent investments and changes.
If our politicians had any guts they would enact an adjustable gas tax that would keep gasoline at a minimum of $3.50 and then increase this amount by 25 cents a year till it hit $5.00 a gallon. If this happened, we would see huge investments in alternatives.
But, if oil prices stay in the $60-$70 range for the next 6 months, I think you'll see this issue drop completely off the radar, as people become used to it.
You have to remember that for US citizens, oil is still really really cheap at $70 a barrel.
Another factor beyond his control also will affect Worthington's 1,100-acre crop farming operation this year: high-priced diesel fuel, fertilizer, propane and other energy products. By his estimate, those costs will add $22 per acre to his production expenses on 750 acres of corn - $16,500 in all.
"When you put the LP costs and the fertilizer and the diesel together, you're talking serious dollars," said Worthington, a 43-year-old, third-generation Iowa farmer. "Something has to give."
We had the warmest winter on record in North America. Average temps were 10 degrees above normal in much of US so there was alot of natural gas left over in storage. Each year there are two high demand seasons for NG - summer and winter. Each year going forward we will run the gauntlet of risk of hot summer or cold winter. We are stuck with 30-40% depletion rates on domestic wells, Canada using more and more of her NG to fire tar sands operation, and delays and political problems with increased LNG ports.
The market doesnt work in situations like this. End users can earn a 100%+ return by buying front month NG now and storing it against Jan-Feb needs (price is over double). But there does NOT exist such storage capacity otherwise people would be doing it. NG market will continue to be just in time inventory - crisis will be here first time we have hot summer or cold winter. (Russia had a VERY cold winter this year).
The mild winter has (because of lowering NG demand) put some relief on coal/rail infrastructure and if there is alot of left over NG by summers end it will likely replace coal for power demand at the margin rather than be potentially flared (gasp!).
This is a long winded answer of saying the crisis in NG in US exists -it just has a time lag.
Natural Gas production is at its lowest point in years though stocks are building. It is all the result of demand destruction. In the last three years, because of very high natural gas prices, many industrial users, such as nitrogen fertilizer producers, have moved overseas where natural gas prices are much lower. It is easy for a lot of people. Natural gas prices of over $15 last November was the death knell for many industrial users. They either moved overseas or just closed their doors for good.
US natural gas production peaked in 1973 then reached a secondary but lower peak in 2001. We are definitely on the downhill side of the peak and will see lower production each year. But because people can either close shop, move overseas or switch to coal for power generation, we will not likely see prices above $15 again for several years.
We have local gas storage tanks in the UK that move up and down with the volume being stored. The local tank, less than a mile from where I live, dipped to its lowest level early winter that I had ever witnessed. Interestingly after a cold spell in March the height was raised in April only to take a dive last month close to the winter level and has stayed low.
I think the UK is going to be very 'interesting' this winterin relation to NG.
What ever happened to the natural gas crisis I thought we were going to have??
It's still coming. Denver, as you probably heard, had its first-ever winter blackout, partly due to a downturn in natural gas supply. A fluke, according to Xcel Energy, but many new patterns begin as flukes.
In Vermont we have had 9 days in a row of rain, heavy at times and the rivers are overflowing. I dont know about how common this is as I am new here. With global climate change and such, I assume we will continue to see higher volatility in weather patterns across the globe. Since its a closed system, is the amount of rain, accounting for any glacial melt, the same on the planet each year? And heavier than normal rain in Vermont means it is less than normal elswhere?
A peak oil forum not exactly the place to ask this, but lots of smart weather people on here. I ask, primarily to know the standard deviation of weather, hence crop, hence energy impacts going forward.
And heavier than normal rain in Vermont means it is less than normal elswhere?
Weather patterns have been highly unusual in a lot of places. Parts of Oklahoma and Texas just went through a 100-year type drought. My family's farm in Oklahoma got drier than I have ever seen it. Creeks dried up, and our large stock ponds were down to puddles. My Dad has lived on that place for 50 years, and said he had never seen anything remotely like it.
On top of that, we just had one of the warmest winters on record in my part of Montana. It rained for a record number of days in Seattle. It didn't rain for a record number of days in Arizona.
Maybe this is just part of the normal weather cycles. But I suspect it isn't.
There are regions, which will get more precipitation on account of climate change, and there are regions which are expected to become drier.
However a rule of thumb is, the more energy (higher temperature) is in the atmosphere, the more water it can transport and eventually rain down. However this doesn't help, when it is a tropical cyclone (Hurricane) oder torrential summer rains, which we had 4 years ago the eastern parts of Germany, and in parts of Poland the Czech Republic.
The water cycle is a cylce, but there are many "storage factors" which change. Deforestation changes the intensity of run-off in rivers, dams do the same. Agriculture uses masses of water and a lot of groundwater which needes to be replenished finally.
To show a regional example: The western parts of Germany are expected to get more precipitation on account of climate change. Weather pattern, however are expected to bring a maximum of precipitation in the summer months. The eastern parts and here especially the region around Berlin is expected to become more and more a steppe. Which is as well to be blamed to the topsoil quality here, sandy soils drain water very well and therefore moisture can't be given back to the local climate (natural landscapes always create their own weather patterns in some parts, best exampel is the rain forest).
Expect more extreme weather conditions in th forecoming years. I presume North America is more prone to such changes, because the north-south direction of the Rocky Mountains or Apalachians help transporting air masses very quickly in both directions.
One should be able to find published lists of all recent floods on record. One should also be able to find a list of the 10, 25, 40 and 100 year flood levels for any river. The 100 year flood level, for example, means a flood that occurs about once every 100 year. Probably the flood levels are lower than they were historically bc/ public works projects such as building of dams and resevoirs occured in the middle part of the 20th century. Also floods are highly related to deforestation as a large tree can hold many gallons of water on its leaves and bark. In my area, the greatest floods were in the late 1800's and early 1900's as we had by then completely deforested the area and the dams had not yet been built. The worst flood in nearly 100 years is fifteen feet lower then the record floods as dams and resevoirs have been built and forest have been partially restored. In other words there are many variables that affect flood levels so they are very crude indicators of total rainfall or any other measure of weather. As pointed out by another reader, some areas will get more rain, others will experience drought as the globe warms.
New Orleans since Hurricane Rita has had what passes for a drought here. No real negative effects since it still rains, just not as much or as often.
A few years ago we had no rain for all of July and none in August till the last few hours of the month. Unique in records going back over 150 years and newspaper accounts back further than that.
A single data point which is not enough to make any inferences from.
To repeat myself:
The present plateau is very easy to distinguish from previous ones.
Just look at a graph of total world supply, ex-USA, ex-USSR(and successor states), ex-OPEC.
It's as smooth as you could wish, and it's just peaked.
No outsize contribution of any one country, no political revolutions, no swing producers, no cartel considerations have distorted it.
It suggests that before too long, we're going to plunge.
Did it look chopped off like that when you copied it? Someone complained yesterday that the graphs were showing up chopped off. They look fine to me, so if they are chopped off, I need to investigate.
I'm pretty sure that is always a case of the user's screen resolution (or window size) combined with page layouts that constrain columns (as in the typical 3-column blog layout). The above looks fine to me, if I shrink my browser window it appears chopped.
You have posted it as <img src="http://static.flickr. ..." height="467" width="861" alt="Hubbertworld2004">.
Try shrinking the posted dimensions ( to less than the actual picture size) and it should fit a typical browser better. Of course your results may vary with this; Super G probably knows a better way to scale images...
For example <img src="http://static.flickr. ..." height="311" width="574" alt="Hubbertworld2004"> will look like this:
You can also specify 100% for the width and it will autosize based on the column width. So:
img src="http://static.flickr. ..." width=100% alt="Hubbertworld2004"
gives
which you should find resizes to fit the width of your center column.
Im figuring this out on the fly - I have no training or knowledge in HTML - Stuart in a post long ago indicated what I was supposed to do to show a graph and Ive been repeating it ever since - is there any relatively easy way to learn how to make more complicated posts? e.g. HTML for dummies?
well in that text should be dimensions of the image. Make them smaller proportionally. Or in flickr itself make sure you are clicking on the "medium" or smaller size option. Large is usually to large.
In preparation for the upcoming G8 meeting, the energy ministers/secretaries of the G8, along with various other major players in the consumption or production of energy, met and pre-worked some of the major issues, of which energy will be one of the most important: http://en.rian.ru/analysis/20060317/44488927.html
A few things worth noting form the above (emphasis mine):
"Viktor Khristenko said the concept of energy security includes the guaranteed demand for its oil and gas abroad. This does not fully coincide with the Western strategy. In February, President Bush called on his compatriots to give up their addiction to oil and focus on the development of alternative energy sources."
So, using President Bush's own analogy, the dealer wants to keep his addicts. I guess the only way to guarantee a certain demand is an agreement to set the minimum for delivery or price, or both.
The Russians seem quite confident that they can deliver lots of energy for several years, quite in contrast to many of TOD's readers.
In 1999, the top 10 major oil companies working the North Sea--using the best data, best engineers and best technology available--were predicting that North Sea oil production would not peak until 2010 at the earliest.
As the HL model predicted, North Sea crude + condensate production peaked in the vicintiy of 50% of Qt (total estimated recoverable reserves), and production has been steadily falling since 1999. The HL model indicates that the North Sea is about two-thirds depleted.
It's an old story that oil producers are confident of their ability to maintain and grow their production.
Some people in Texas are talking about substantially increasing our production through the use of better technology. Texas is down about 75% from our peak, and we have never shown a year over year increase since we peaked.
Russia's secondary peak was just making up for what was not produced after the Soviet Union collapsed. Existing producing basins in Russia are probably about 80% to as much as 90% depleted.
A group of animals are staring open mouthed at a large SUV:
How many humans does it carry?
Usually just one. They are gradually losing their ability to walk.
They didn't see the stop sign, took a turn for the worst
She said, "Listen baby, you can hear the engine ring
We've been up and down this highway, haven't seen a god damn
thing"
He said, "Call the doctor, I think I'm gonna crash"
"The doctor say he's comin', but you gotta pay him cash"
They went rushin' down that freeway, messed around and got lost
They didn't care they were just dyin' to get off...
Eagles '76
I'm optimistic because I think the central question has been answered: will people respond, or will they remain in denial?
We are seeing responses wall to wall. Now, some of those responses are stupid ("E85 Everywhere") but I'll take 'em. I figure the stupid ideas will drop out of their own accord. They are a little wasted energy, but there is your invisible hand, and creative destruction, in action. Heck, a few weeks ago commentators here were maligning the invisible hand for its inaction, and now it is off the stick:
Mobilization ...
"What people are seeing at their gasoline pumps reflects the global economy in which we live," President George W. Bush said last week. "I think we need . . . to encourage conservation, to expand domestic production and to develop alternative sources of energy like ethanol."
Oh my! Dubya used the C word!
I agree... I too am surprised by the amount of response. I thought it would take $5/gallon gas before we saw this.
Hopefully, gas prices will stay high enough in the near term to get people to make more permanent investments and changes.
If our politicians had any guts they would enact an adjustable gas tax that would keep gasoline at a minimum of $3.50 and then increase this amount by 25 cents a year till it hit $5.00 a gallon. If this happened, we would see huge investments in alternatives.
But, if oil prices stay in the $60-$70 range for the next 6 months, I think you'll see this issue drop completely off the radar, as people become used to it.
You have to remember that for US citizens, oil is still really really cheap at $70 a barrel.
http://tonto.eia.doe.gov/oog/info/twip/twip.asp
And check out Cost of raising corn grows
The market doesnt work in situations like this. End users can earn a 100%+ return by buying front month NG now and storing it against Jan-Feb needs (price is over double). But there does NOT exist such storage capacity otherwise people would be doing it. NG market will continue to be just in time inventory - crisis will be here first time we have hot summer or cold winter. (Russia had a VERY cold winter this year).
The mild winter has (because of lowering NG demand) put some relief on coal/rail infrastructure and if there is alot of left over NG by summers end it will likely replace coal for power demand at the margin rather than be potentially flared (gasp!).
This is a long winded answer of saying the crisis in NG in US exists -it just has a time lag.
See bottom middle graphic for disparity of temperatures in US/Canada vs Europe/Russia
Natural Gas production is at its lowest point in years though stocks are building. It is all the result of demand destruction. In the last three years, because of very high natural gas prices, many industrial users, such as nitrogen fertilizer producers, have moved overseas where natural gas prices are much lower. It is easy for a lot of people. Natural gas prices of over $15 last November was the death knell for many industrial users. They either moved overseas or just closed their doors for good.
US natural gas production peaked in 1973 then reached a secondary but lower peak in 2001. We are definitely on the downhill side of the peak and will see lower production each year. But because people can either close shop, move overseas or switch to coal for power generation, we will not likely see prices above $15 again for several years.
http://tonto.eia.doe.gov/dnav/ng/ng_prod_sum_dcu_NUS_m.htm
http://money.guardian.co.uk/utilities/story/0,,1779621,00.html
We have local gas storage tanks in the UK that move up and down with the volume being stored. The local tank, less than a mile from where I live, dipped to its lowest level early winter that I had ever witnessed. Interestingly after a cold spell in March the height was raised in April only to take a dive last month close to the winter level and has stayed low.
I think the UK is going to be very 'interesting' this winterin relation to NG.
It's still coming. Denver, as you probably heard, had its first-ever winter blackout, partly due to a downturn in natural gas supply. A fluke, according to Xcel Energy, but many new patterns begin as flukes.
In Vermont we have had 9 days in a row of rain, heavy at times and the rivers are overflowing. I dont know about how common this is as I am new here. With global climate change and such, I assume we will continue to see higher volatility in weather patterns across the globe. Since its a closed system, is the amount of rain, accounting for any glacial melt, the same on the planet each year? And heavier than normal rain in Vermont means it is less than normal elswhere?
A peak oil forum not exactly the place to ask this, but lots of smart weather people on here. I ask, primarily to know the standard deviation of weather, hence crop, hence energy impacts going forward.
Weather patterns have been highly unusual in a lot of places. Parts of Oklahoma and Texas just went through a 100-year type drought. My family's farm in Oklahoma got drier than I have ever seen it. Creeks dried up, and our large stock ponds were down to puddles. My Dad has lived on that place for 50 years, and said he had never seen anything remotely like it.
On top of that, we just had one of the warmest winters on record in my part of Montana. It rained for a record number of days in Seattle. It didn't rain for a record number of days in Arizona.
Maybe this is just part of the normal weather cycles. But I suspect it isn't.
RR
However a rule of thumb is, the more energy (higher temperature) is in the atmosphere, the more water it can transport and eventually rain down. However this doesn't help, when it is a tropical cyclone (Hurricane) oder torrential summer rains, which we had 4 years ago the eastern parts of Germany, and in parts of Poland the Czech Republic.
The water cycle is a cylce, but there are many "storage factors" which change. Deforestation changes the intensity of run-off in rivers, dams do the same. Agriculture uses masses of water and a lot of groundwater which needes to be replenished finally.
To show a regional example: The western parts of Germany are expected to get more precipitation on account of climate change. Weather pattern, however are expected to bring a maximum of precipitation in the summer months. The eastern parts and here especially the region around Berlin is expected to become more and more a steppe. Which is as well to be blamed to the topsoil quality here, sandy soils drain water very well and therefore moisture can't be given back to the local climate (natural landscapes always create their own weather patterns in some parts, best exampel is the rain forest).
Expect more extreme weather conditions in th forecoming years. I presume North America is more prone to such changes, because the north-south direction of the Rocky Mountains or Apalachians help transporting air masses very quickly in both directions.
matthias, berlin
NOAA is one place to track river levels:
http://newweb.erh.noaa.gov
Also the US corps of engineers is another place to check.
A few years ago we had no rain for all of July and none in August till the last few hours of the month. Unique in records going back over 150 years and newspaper accounts back further than that.
A single data point which is not enough to make any inferences from.
The present plateau is very easy to distinguish from previous ones.
Just look at a graph of total world supply, ex-USA, ex-USSR(and successor states), ex-OPEC.
It's as smooth as you could wish, and it's just peaked.
No outsize contribution of any one country, no political revolutions, no swing producers, no cartel considerations have distorted it.
It suggests that before too long, we're going to plunge.
OK. Just show me one.
In the meantime, you can also see the graph here:
http://en.wikipedia.org/wiki/Peak_oil
RR
Try shrinking the posted dimensions ( to less than the actual picture size) and it should fit a typical browser better. Of course your results may vary with this; Super G probably knows a better way to scale images...
For example <img src="http://static.flickr. ..." height="311" width="574" alt="Hubbertworld2004"> will look like this:
gives
which you should find resizes to fit the width of your center column.
What You Need to Know about Peak Oil
See the 3rd graph down.
RR
http://en.rian.ru/analysis/20060317/44488927.html
A few things worth noting form the above (emphasis mine):
"Viktor Khristenko said the concept of energy security includes the guaranteed demand for its oil and gas abroad. This does not fully coincide with the Western strategy. In February, President Bush called on his compatriots to give up their addiction to oil and focus on the development of alternative energy sources."
So, using President Bush's own analogy, the dealer wants to keep his addicts. I guess the only way to guarantee a certain demand is an agreement to set the minimum for delivery or price, or both.
The Russians seem quite confident that they can deliver lots of energy for several years, quite in contrast to many of TOD's readers.
As the HL model predicted, North Sea crude + condensate production peaked in the vicintiy of 50% of Qt (total estimated recoverable reserves), and production has been steadily falling since 1999. The HL model indicates that the North Sea is about two-thirds depleted.
It's an old story that oil producers are confident of their ability to maintain and grow their production.
Some people in Texas are talking about substantially increasing our production through the use of better technology. Texas is down about 75% from our peak, and we have never shown a year over year increase since we peaked.
Russia's secondary peak was just making up for what was not produced after the Soviet Union collapsed. Existing producing basins in Russia are probably about 80% to as much as 90% depleted.
Is that some of them or all of them?