The Oil Drum

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Global Total Liquids production and oil price, January 2002 to present. Production data from the IEA, data files supplied by Rembrandt Koppelaar. Monthly average WTI oil prices from Economagic.

With oil reaching $135 / barrel, Oil Drum readership exceeding 30,000 unique visitors per day and many wild stories circulating in the MSM as to why oil prices are so high this post strives to explain why oil prices are rising exponentially:

• Supply and demand
• Decline of older fields
• Declining net energy and energy density
• New mega-projects
• OPEC spare capacity
• Peak exports

This is a repost of Professor Cutler Cleveland's paper on energy transitions. It provides an excellent big picture overview of what issues need to be considered in a successful transition away from fossil fuels. Professor Cleveland previously wrote "Energy From Wind - A Discussion of the EROI Research", and "Ten Fundamental Principles of Net Energy" posted on theoildrum.com. Cutler Cleveland is a Professor at Boston University and has been researching and writing on energy issues for over 20 years. He is Editor-in-Chief of the Encyclopedia of Earth, Editor-in-Chief of the Encyclopedia of Energy, the Dictionary of Energy and the Journal of Ecological Economics

Composition of U.S. energy use. (Source: Cutler Cleveland) Click to Enlarge

This is a guest post by oil and energy economist Douglas Reynolds. Dr. Reynolds is Graduate Director of Economics at the University of Alaska Fairbanks, and author of "Scarcity and Growth Considering Oil and Energy", and "Alaska and North Slope Natural Gas". Doug has a prior guest post on theoildrum on The Energy Utilization Chain. This post offers a different but related perspective on energy comparisons and transitions than last weeks post on Energy Transitions by Professor Cutler Cleveland.

1. Weight Grade

The weight grade determines how much energy there is per pound of energy resource. For example, coal has about 12.7 thousand BTU/lb, natural gas about 10 thousand BTU/lb, oil about 19.3 thousand BTU/lb, and an electric battery typically has 100 BTU/lb. Electric batteries then are very heavy compared to their energy output which is why electric cars do not have very good driving ranges.

Professor Reynolds' paper is below the fold.

This is a guest post from Cutler Cleveland. It provides an excellent big picture overview of what variables we need to consider as we transition away from fossil fuels. Professor Cleveland previously wrote "Energy From Wind - A Discussion of the EROI Research", and "Ten Fundamental Principles of Net Energy" posted on theoildrum.com. Cutler Cleveland is a Professor at Boston University and has been researching and writing on energy issues for over 20 years. He is Editor-in-Chief of the Encyclopedia of Earth, Editor-in-Chief of the Encyclopedia of Energy, the Dictionary of Energy and the Journal of Ecological Economics