It was ALWAYS the oil
With gas at four bucks a gallon [depending on where you live, $3.80-something in the Patch] it was a quieter opening weekend here at the lake than usual — everywhere, I hear.
The week George W. Bush took office, fuel was $1.49 at the pump and people were worried; the war has certainly enriched the Bush cartel — the plan all along, me’thinks.
Like my friend Fishin’ Jim sez … if all cars got 200 mpg, gas would cost $15 a gallon.
Here’s reads — and a quick word on the race, this from Big Dog Bill the other day:
Clinton also spoke against bullying superdelegates to make up their minds, saying, “I cant believe it. It is just frantic the way they are trying to push and pressure and bully all these superdelegates to come out. ‘Oh, this is so terrible: The people they want her. Oh, this is so terrible: She is winning the general election, and he is not. Oh my goodness, we have to cover this up.’”
To which I can only say:
The Five Stages of Grief, via Dr. Elisabeth Kubler-Ross
1. Denial and Isolation.
2. Anger.
3. Bargaining.
4. Depression.
5. Acceptance.
Move along, Bill darlin’.
You’ll find articles/reads here, here and here on the topic.
Here are reads that echo from those shouting into the wilderness during the early years of the war … which is, and was, about the oil.
Jude
Iraq War May Have Increased Energy Costs Worldwide by a Staggering $6 Trillion
Geoffrey Lean, The Independent
May 27, 2008
The Iraq War means oil costs three times more than it should. How are our lives going to change with oil heading toward $200 a barrel?
The invasion of Iraq by Britain and the US has trebled the price of oil, according to a leading expert, costing the world a staggering $6 trillion in higher energy prices alone.
The oil economist Dr Mamdouh Salameh, who advises both the World Bank and the UN Industrial Development Organisation (Unido), told The Independent on Sunday that the price of oil would now be no more than $40 a barrel, less than a third of the record $135 a barrel reached last week, if it had not been for the Iraq war.
He spoke after oil prices set a new record on 13 consecutive days over the past two weeks. They have now multiplied sixfold since 2002, compared with the fourfold increase of the 1973 and 1974 “oil shock” that ended the world’s long postwar boom.
Goldman Sachs predicted last week that the price could rise to an unprecedented $200 a barrel over the next year, and the world is coming to terms with the idea that the age of cheap oil has ended, with far-reaching repercussions on their activities.
Dr Salameh, director of the UK-based Oil Market Consultancy Service, and an authority on Iraq’s oil, said it is the only one of the world’s biggest producing countries with enough reserves substantially to increase its flow.
Production in eight of the others — the US, Canada, Iran, Indonesia, Russia, Britain, Norway and Mexico — has peaked, he says, while China and Saudia Arabia, the remaining two, are nearing the point at of decline. Before the war, Saddam Hussein’s regime pumped some 3.5 million barrels of oil a day, but this had now fallen to just two million barrels.
Dr Salameh told the all-party parliamentary group on peak oil last month that Iraq had offered the United States a deal, three years before the war, that would have opened up 10 new giant oil fields on “generous” terms in return for the lifting of sanctions. “This would certainly have prevented the steep rise of the oil price,” he said. “But the US had a different idea. It planned to occupy Iraq and annex its oil.”
Chris Skrebowski, the editor of Petroleum Review, said: “There are many ifs in the world oil market. This is a very big one, but there are others. If there had been a civil war in Iraq, even less oil would have been produced.”
David Strahan: What happens next? The expert’s view
At just under 86 million barrels per day, global oil production has, essentially, stagnated since 2005, despite soaring demand, suggesting that production has already reached its geological limits, or “peak oil”.
Recession in the West may not provide relief on prices. There is increasing demand from countries such as China, Russia and the Opec countries, whose consumers are cushioned against rising prices by heavy subsidies. The future could unfold in a number of ways:
Oil price collapses
Fuel subsidies could suddenly be scrapped, dousing demand. Cost pressures have forced Malaysia, Indonesia and Taiwan to cut them, but China is hardly strapped for cash. Opec producers are under no pressure to abolish subsidies; as the oil price rises they get richer. Prospect: very unlikely.
Peace could break out in Iraq, the long-disputed oil law agreed, and international oil companies start work on the world’s largest collection of untapped oil fields. Prospect: vanishingly unlikely.
Oil price stabilises or moderates
Deep recession in the West might cut oil consumption enough to offset growth in the developing world and Opec, or even engulf them too, softening prices. Prospect: unlikely in the short term.
Oil price soars
Russian oil output has gone into decline; Saudi Arabia has shelved plans to expand production capacity, and advisers to the Nigerian government predict its output will fall by 30 per cent by 2015. More news like this, expect oil at $200 a barrel. Prospect: likely.
Big oil producers will increasingly divert exports for home consumption. Opec, Russian and Mexican exports expected to fall, pushing oil to $200 by 2012. Prospect: highly likely.
The writer is author of ‘The Last Oil Shock’, John Murray, lastoilshock.com
Peak oil
After 150 years of growth, the oil age is beginning to come to an end. “Peak oil” is the common term for when production stops increasing and starts to decline. At that point what have been ever-expanding and cheap supplies of the resource on which all modern economies depend become scarcer and more expensive, with potentially devastating consequences.
Pessimists believe that production has passed its peak. Optimists say it may be 20 years or so away — which would give us some time to prepare — but are now muted. Last week the hitherto optimistic International Energy Agency admitted that it may have overestimated future capacity. Chris Skrebowski, editor of ‘Petroleum Review’ and once an optimist himself, believes that the world is now in “the foothills of peak oil”. Prices may ease a bit over the next few years, but then the real crunch will come. The price then? “Pick a number!”
Travel
Oil provides 95 per cent of the energy used in transport, so this will be hit hard and soon. People are likely to go on using their cars, but airlines are expected to be the first to suffer. On Thursday, British Airways’ chief executive Willie Walsh declared that the era of cheap flights was over, suggesting that those environmentalists who have made them their main target for combating climate change may have been wasting their breath.
At least three carriers have already gone bust this year. Last week, American Airlines said it was cutting routes, laying off staff, and charging US passengers $15 to check in a bag because of a $3bn rise in its fuel bills. Even Michael O’Leary, chief executive of Ryanair, says the oil price is “really hurting”. On Thursday, Credit Suisse analysts said his company would slip into the red if oil prices rose just a little more, to $140 a barrel.
Cars
The world’s biggest oil well, it is said, lies beneath Detroit. US vehicles get an average of only 25 miles per gallon. Dramatically improving this would do more to ease the oil crunch than any likely new discovery. But new measures recently approved by Congress would increase the average only to the 35mpg already being achieved by China. Europe does better, if not well enough, at 44mpg.
Rising fuel prices are already beginning to drive change. Sales of 4×4s are plummeting in both the US and Britain, and those of hybrids — which do 60mpg are soaring. As the price climbs further, manufacturers will unlock long-prepared plans for much more efficient vehicles. “Plug-in” hybrids, charged up with electricity overnight, save another 45 per cent in petrol consumption. Further down the line is the “hypercar” — made of tough, light plastic — which could cross the US on a single tankful.
Houses
All new houses in Britain will have to be zero carbon — burning no fossil fuels such as oil — by 2016, the Government announced, and housebuilders are struggling to meet the target. At present the standard can be reached only at great expense, but the industry is confident of bringing the cost down as mass production kicks in. It is even more important to adapt existing homes.
The key step is to super-insulate the house to make it as energy-efficient as possible — and only then to provide renewable energy sources. Solar water heaters, ground source heat pumps and boilers powered by wood pellets are favourites. Rooftop windmills do not work well enough yet. Photovoltaic panels, which get electricity from the sun, are expensive but their price should come down. Britain has lagged behind other countries. Soaring energy prices should shake things up.
Shopping
Effectively, almost everything is partially made of oil, and so is going to get more expensive. About 10 calories of oil are burned to produce each calorie of food in the US, and farming a single cow and getting it to market uses as much as driving from New York to Los Angeles. Some 630g of fuel is used to produce every gram of microchips.
The cult of local, seasonal produce will enter the mainstream, as everyone learns about food miles and a modern-day Dig for Victory grips gardeners — bad news for the farm workers overseas who provide 95 per cent of our fruit and half our vegetables. Trips to out-of-town supermarkets will seem extravagant, heralding a high street renaissance and a new surge in online grocery shopping, and soon we’ll all be eating our own potatoes.
Third World
Poor countries and their peoples will be hit by a devastating double whammy as both their fuel and food prices increase. Last year, when oil cost only about half as much, countries from Nepal to Nicaragua were hit by fuel shortages. At least 25 of the 44 sub-Saharan nations are facing crippling electricity shortages.
As oil is used in agriculture, its increased cost will also drive up the price of food, making more and more people go hungry. Worse, expensive petrol is bound to increase the drive towards biofuels made from maize and other crops, which then brings the world’s poorest people into competition with affluent motorists for grain — a contest they cannot win. Just one fill-up of a 4×4’s tank with ethanol uses enough grain to feed one person for a year.
Emerging economies
China and India and other developing countries will help to drive up demand for oil and compete for scarce supplies. This has already helped to raise prices: demand for oil from Western countries has actually fallen over the past two years, but the emerging economies have more than made up the slack. And they have the money to do so.
Chinese and Indian consumers have so far been insulated from the effects of the price increase by heavy government subsidies, and their industrial revolutions and rapid growth are largely fueled by oil. There is little sign that the growth in demand will slacken These countries are also likely to follow the time-honored Western tradition of making deals with oil-exporting countries — and backing unpleasant regimes — to try to secure supplies. ++
Obama’s Secret War Profiteering Tax
Greg Palast, Smirking Chimp
May 23, 2008
I can’t make this up:
In a hotel room in Brussels, the chief executives of the world’s top oil companies unrolled a huge map of the Middle East, drew a fat, red line around Iraq and signed their names to it.
The map, the red line, the secret signatures. It explains this war. It explains this week’s rocketing of the price of oil to $134 a barrel.
It happened on July 31, 1928, but the bill came due now.
Barack Obama knows this. Or, just as important, those crafting his policies seem to know this. Same for Hillary Clinton’s team. There could be no more vital difference between the Republican and Democratic candidacies. And you won’t learn a thing about it on the news from the Fox-holes.
Let me explain.
In 1928, oil company chieftains (from Anglo-Persian Oil, now British Petroleum, from Standard Oil, now Exxon, and their Continental counterparts) were faced with a crisis: falling prices due to rising supplies of oil; the same crisis faced by their successors during the Clinton years, when oil traded at $22 a barrel.
The solution then, as now: stop the flow of oil, squeeze the market, raise the price. The method: put a red line around Iraq and declare that virtually all the oil under its sands would remain there, untapped. Their plan: choke supply, raise prices rise, boost profits. That was the program for 1928. For 2003. For 2008.
Again and again, year after year, the world price of oil has been boosted artificially by keeping a tight limit on Iraq’s oil output. Methods varied. The 1928 “Redline” agreement held, in various forms, for over three decades. It was replaced in 1959 by quotas imposed by President Eisenhower. Then Saudi Arabia and OPEC kept Iraq, capable of producing over 6 million barrels a day, capped at half that, given an export quota equal to Iran’s lower output.
In 1991, output was again limited, this time by a new red line: B-52 bombings by Bush Senior’s air force. Then came the Oil Embargo followed by the “Food for Oil” program. Not much food for them, not much oil for us.
In 2002, after Bush Junior took power, the top ten oil companies took in a nice $31 billion in profits. But then, a miracle fell from the sky. Or, more precisely, the 101st Airborne landed. Bush declared, “Bring’m on!” and, as the dogs of war chewed up the world’s second largest source of oil, crude doubled in two years to an astonishing $40 a barrel and those same oil companies saw their profits triple to $87 billion.
In response, Senators Obama and Clinton propose something wrongly called a “windfall” profits tax on oil. But oil industry profits didn’t blow in on a breeze. It is war, not wind, that fills their coffers. The beastly leap in prices is nothing but war profiteering, hiking prices to take cruel advantage of oil fields shut by bullets and blood.
I wish to hell the Democrats would call their plan what it is: A war profiteering tax. War is profitable business - if you’re an oil man. But somehow, the public pays the price, at the pump and at the funerals, and the oil companies reap the benefits.
Indeed, the recent engorgement in oil prices and profits goes right back to Bush-McCain “surge.” The Iraq government attack on a Basra militia was really nothing more than Baghdad’s leaping into a gang war over control of Iraq’s Southern oil fields and oil-loading docks. Moqtada al-Sadr’s gangsters and the government-sponsored greedsters of SCIRI (the Supreme Council For Islamic Revolution In Iraq) are battling over an estimated $5 billion a year in oil shipment kickbacks, theft and protection fees.
The Wall Street Journal reported that the surge-backed civil warring has cut Iraq’s exports by up to a million barrels a day. And that translates to slashing OPEC excess crude capacity by nearly half.
Result: ka-BOOM in oil prices and ka-ZOOM in oil profits. For 2007, Exxon recorded the highest annual profit, $40.6 billion, of any enterprise since the building of the pyramids. And that was BEFORE the war surge and price surge to over $100 a barrel.
It’s been a good war for Exxon and friends. Since George Bush began to beat the war-drum for an invasion of Iraq, the value of Exxon’s reserves has risen - are you ready for this? - by $2 trillion.
Obama’s war profiteering tax, or “oil windfall profits” tax, would equal just 20% of the industry’s charges in excess of $80 a barrel. It’s embarrassingly small actually, smaller than every windfall tax charged by every other nation. (Ecuador, for example, captures up to 99% of the higher earnings).
Nevertheless, oilman George W. Bush opposes it as does Bush’s man McCain.
Senator McCain admonishes us that the po’ widdle oil companies need more than 80% of their windfall so they can explore for more oil. When pigs fly, Senator. Last year, Exxon spent $36 billion of its $40 billion income on dividends and special payouts to stockholders in tax-free buy-backs. Even the Journal called Exxon’s capital investment spending “stingy.”
At today’s prices Obama’s windfall tax, teeny as it is, would bring in nearly a billion dollars a day for the US Treasury. Clinton’s plan is similar. Yet the press’ entire discussion of gas prices is shifted to whether the government should knock some sales tax pennies off the oil companies’ pillaging at the pump.
More important than even the Democrats’ declaring that oil company profits are undeserved, is their implicit understanding that the profits are the spoils of war.
And that’s another reason to tax the oil industry’s ill-gotten gain. Vietnam showed us that foreign wars don’t end when the invader can no longer fight, but when the invasion is no longer profitable. ++
Why Dems and Republicans Are Afraid of Two Words: Peak Oil
The pro-growth faction has reacted quickly and scathingly to the idea that there could be limits to growth.
Kelpie Wilson, TruthOut
May 22, 2008
In 1956, M. King Hubbert, a petroleum geologist with Shell Oil, presented a paper to the American Petroleum Institute that predicted US oil production would peak in the early 1970s and then follow a declining curve, now known as Hubbert’s curve.
But Hubbert almost didn’t get to give his paper. He got a call from his bosses at Shell, who asked him to “tone it down.” His reply was that there was nothing to tone down. It was just straightforward analysis. He presented the paper, unedited. You can read the whole story here.
Since that time, the oil industry and its political supporters have done everything they can to tone down the message that oil is a finite resource and that we will run out of it some day. Why would they do that? To further the short-sighted, short-term pursuit of profit. In 2004, Shell finally got caught in a lie about the size of its oil reserves. The company had inflated the stated size of its oil reserves to keep stock share prices high because who wants to invest in a company — or an industry — that is going the way of the dinosaurs?
Since 1956, the world economy has proceeded under a sort of oil company spell that has woven the illusion all around us that oil depletion is so far into the future that we don’t need to worry about it. That belief was essential to support the aim of an endlessly growing economy. There have been a few hitches in that strategy.
In 1972, just as oil production in the United States reached its all-time peak, a group of computer modelers from MIT released a study called “The Limits to Growth.” They predicted a steep decline in natural resources of all kinds. Because reserve numbers for many minerals, including oil, were not accurately known back then, they looked at different scenarios. Some showed us running out of oil before 2000 and some showed the peak occurring toward the middle of the 21st century.
The pro-growth faction reacted quickly and scathingly to the idea that there could be limits to growth. The MIT scientists were treated like Cassandras in academia and in the press. This strategy of killing the messenger, the bearer of bad news, soon permeated American politics. Jimmy Carter tried to grapple with the energy crisis in the late 1970s with support for energy alternatives and conservation, but he was ridiculed by the media and American consumers were not able to hear the message. Ronald Reagan walked away with the presidency and promptly tore the solar panels off the roof of the White House. Ever since then, it has somehow been “not polite” to talk about limits to growth.
Today, despite skyrocketing oil prices, most politicians still avoid the term “peak oil.” Most of the media still treat peak oil advocates with skepticism, using epithets like “fringe” and “so-called”to describe peak oil theory. To be clear, peak oil is often misunderstood. The date that the world reaches peak oil is not the date we actually run out, but the date that we stop increasing production. This is followed by a “plateau” where oil production is flat.
Eventually, oil production will decline. Even a plateau is a big problem for a world economy that is based on growth. In a world where 850 million are still going hungry and 3 billion out of 6.5 billion live on less than $2 a day, stagnant oil production means an end to development models based on economic growth. The statistics show that oil production has been flat for more than two years now.
These facts are simple. As Hubbert said back in 1956: “Nothing sensational about it, just straightforward analysis.”
And yet the most powerful institutions in our society continue to do everything they can to avoid confronting the truth. Fortunately, a vast network of independent citizens, academics and renegade oil company employees has kept probing at the truth and attempting to educate the public about peak oil. You can find their work online at sites like energybulletin.net and theoildrum.com.
These networks have not only exposed the real statistics about oil production constraints, but they have begun to grapple with how the world should respond to this unprecedented crisis. Anyone who is interested in a firsthand encounter with the intrepid “peakists” might check out an upcoming conference. The International Conference on Peak Oil and Climate Change: Paths to Sustainability takes place from May 30 to June 1 in Grand Rapids, Michigan.
Michigan Congressman Vernon Ehler will launch the conference. Ehler is a member of the House Peak Oil Caucus, which was founded by another Republican, Roscoe Bartlett of Maryland. The Peak Oil Caucus is co-chaired by Democrat Tom Udall, but it has only 15 members in all. There is no similar group in the Senate and very few other politicians will use the term peak oil. None of the current presidential candidates have made peak oil an issue. Bartlett’s press secretary, Lisa Wright, said that Bartlett has talked about peak oil with John McCain but not with Obama or Clinton. When I asked if McCain would take on the peak oil issue, Wright said, “I would not describe Senator McCain as being nearly as knowledgeable or committed as Representative Bartlett on the issue.”
When speaking of energy issues, politicians will often use the euphemism of energy security, acknowledging that the US has only three percent of the world’s oil reserves and warning that most of the rest of it belongs to unfriendly or unstable governments. While there is truth to this type of statement, it sets up a framework for conflict by creating the perception that there is plenty of oil left but bad people are keeping it away from us.
Both Democrats and Republicans buy into this view. In this election season, some Democrats seem even more willing than Republicans to play the oil fear card and promote quick-fix measures that are ineffectual or downright ridiculous. First there was the gas tax holiday proposed by John McCain and seconded by Hillary Clinton. Barack Obama distinguished himself by resisting the idea.
The economics of it make no sense. It would at best save the average motorist about $30 over a summer of driving, and at worst the increased demand would drive up gas prices. Obama’s position shows he understands that oil supply is not meeting demand, even if he has not used the words “peak oil.”
In the last two weeks, Congress has seen a slew of silly proposals from both sides. Democrats want President Bush to twist Saudi arms to get the kingdom to produce more oil. If that doesn’t work, they want to cut off their arms — weapons that is.
Senator Reid plans to bring an expedited resolution to the Senate floor that would block $1.37 billion in arms sales to the Saudis unless they increase oil production by one million barrels a day.
Peak oil educator Richard Heinberg warns where all this confrontation might lead: “[S]uppose we get tough with the Saudis and end up destabilizing the kingdom so that forces unfriendly to us take over. Then we will feel more or less forced to invade in order to maintain access to our national drug of choice. Where would it end? Does any of this help?”
Meanwhile, what Democrats would do to the Saudis, Republicans want to do to the polar bear and the caribou. Republicans are generally in favor of drilling in the Arctic National Wildlife Refuge (ANWR) despite the fact that even at peak production it would meet only two percent of American’s oil demand. But not all Republicans favor drilling in ANWR. Peak Oil Caucus Co-Chair Roscoe Bartlett thinks we should save the Arctic oil for a real emergency. Speaking in opposition to drilling, he said “I am having trouble understanding how it is in our national security interest to use up our little bit of oil as quickly as we can. If we could pump ANWR tomorrow, what would we do the day after tomorrow?”
Bartlett takes this position because he is operating with the knowledge that oil is finite and that the world is nearing or has surpassed peak production. If all members of Congress were operating within this framework, then we would see some very different policy proposals. I asked Lisa Wright why Bartlett’s office thinks the peak oil issue has gotten so little traction in the media and with politicians. Wright blamed a human psychological condition known as cognitive dissonance, “the phenomenon that you only hear what you’re interested in hearing.”
“Hard truths are hard to talk about as well as hard to absorb,” she said. “It’s much easier to believe people who say that if we just have more American production then we wouldn’t have to worry about foreign imports, without explaining that we’re already pumping our minute portion of world reserves three or four times faster than the rest of the world. But we can’t drill our way to self-sufficiency because you can’t pump what’s not there.”
When asked if she saw peak oil becoming an issue in the presidential campaign, Wright said, “It will become a campaign issue if candidates make it an issue and candidates will choose to make it an issue if it shows up as being a motivating issue for voters.” But, she said, “It’s a chicken and egg conundrum. To the extent that voters become informed and aware through media, you’ll find that candidates will follow. That’s generally the way American politics works.”
After years of toning down the message of peak oil in public discourse, voters need to let candidates know that now is the time to tone it up. ++
We Have Gone Mad, Your Majesty, and Only You Can Cure Our Affliction
An open letter to the leader of Opec’s biggest oil producer, the one man who can force Britain to cut its carbon emissions
George Monbiot, The Guardian/UK
Tuesday, May 27, 2008
King Abdaullah of Saudi Arabia
Your Majesty,
In common with the leaders of most western nations, our prime minister is urging you to increase your production of oil. I am writing to ask you to ignore him. Like the other leaders he is delusional, and is no longer competent to make his own decisions.
You and I know that there are several reasons for the high price of oil. Low prices at the beginning of this decade discouraged oil companies from investing in future capacity. There is a global shortage of skilled labour, steel and equipment. The weak dollar means that the price of oil is higher than it would have been if denominated in another currency. While your government says that financial speculation is an important factor, the Bank of England says it is not, so I don’t know what to believe. The major oil producers have also become major consumers; in some cases their exports are falling even as their production has risen, because they are consuming more of their own output.
But what you know and I do not is the extent to which the price of oil might reflect an absolute shortage of global reserves. You and your advisers are perhaps the only people who know the answer to this question. Your published reserves are, of course, a political artefact unconnected to geological reality. The production quotas assigned to its members by Opec, the oil exporters’ cartel, reflect the size of their stated reserves, which means that you have an incentive to exaggerate them. How else could we explain the fact that, despite two decades of furious pumping, your kingdom posts the same reserves as it did in 1988?
You say that you are saving your oil for the benefit of future generations. If this is true, it is a rational economic decision: oil in the ground looks like a better investment than money in the bank. But, reluctant as I am to question your Majesty’s word, I must remind you that some oil analysts are now wondering whether this prudence is a convenient fiction. Are you restricting supply because you want to conserve stocks and keep the price high, or are you unable to raise production because your fabled spare capacity does not in fact exist?
I do not expect an answer to this question. I know that the true state of your reserves is a secret so closely guarded that oil analysts now resort to using spy satellites to try to estimate the speed of subsidence of the ground above your oil fields, as they have no other means of guessing how fast your reserves are running down.
What I know, and you may not, is that the high price of oil is currently the only factor implementing British government policy. The government claims that it is seeking to reduce carbon dioxide emissions, by encouraging people to use less fossil fuel. Now, for the first time in years, its wish has come true: people are driving and flying less. The AA reports that about a fifth of drivers are buying less fuel. A new study by the Worldwide Fund for Nature shows that businesses are encouraging their executives to use video conferences instead of flying. One of the most fuel-intensive industries of all, business-only air travel, has collapsed altogether.
In other words, your restrictions on supply — voluntary or otherwise — are helping the government to meet its carbon targets. So how does it respond? By angrily demanding that you remove them so that we can keep driving and flying as much as we did before. Last week, Gordon Brown averred that it’s “a scandal that 40% of the oil is controlled by Opec, that their decisions can restrict the supply of oil to the rest of the world, and that at a time when oil is desperately needed, and supply needs to expand, that Opec can withhold supply from the market”. In the United States, legislators have gone further: the House of Representatives has voted to bring a lawsuit against Opec’s member states, and Democratic senators are trying to block arms sales to your kingdom unless you raise production.
This illustrates one of our leaders’ delusions. They claim to wish to restrict the demand for fossil fuels, in order to address both climate change and energy security. At the same time, to quote Britain’s Department for Business, they seek to “maximise economic recovery” from their remaining oil, gas and coal reserves.
They persist in believing that both policies can be pursued at once, apparently unaware that if fossil fuels are extracted they will be burnt, however much they claim to wish to reduce consumption. The only states that appear to be imposing restrictions on the supply of fuel are the members of Opec, about which Brown so bitterly complains. Your Majesty, we have gone mad, and you alone can cure our affliction, by keeping your taps shut.
Our leaders, though they do not possess the least idea of whether the oil supplies required to support it will be sustained, are also overseeing a rapid expansion of our transport infrastructure. In the UK, we are building or upgrading thousands of miles of roads and doubling the capacity of our airports, in the expectation that there will be no restriction in the supply of fuel. The government’s central forecast for the long-term price is just $70 a barrel.
Over the past few months, I have been trying to discover how the government derives this optimistic view. In response to a parliamentary question, it reveals that its projection is based on “the assessment made by the International Energy Agency in its 2007 World Energy Outlook”. Well, last week the Wall Street Journal revealed that the IEA “is preparing a sharp downward revision of its oil-supply forecast”. Its final report won’t be released until November, but it has already concluded that “future crude supplies could be far tighter than previously thought”. Its previous estimates of global production were wrong for one simple and shocking reason: it had based them on anticipated demand, rather than anticipated supply. It resolved the question of supply by assuming that it would automatically rise to meet demand, as if it were subject to no inherent restraints.
Our government must have known this, but it has refused to conduct its own analysis of global oil reserves. Uniquely among possible threats to the economy and national security, it has commissioned no research of any kind into this question. So earlier this year, I asked the Department for Business what contingency plans it possesses to meet the eventuality that the IEA’s estimates could be wrong, and that global supplies of petroleum might peak in the near future. “The government,” it replied, “does not feel the need to hold contingency plans.” I am sure I do not need to explain the implications if its forecasts turn out to be wildly wrong.
Your Majesty, I recognise that this is not among your usual duties as the ruler of Saudi Arabia. But I respectfully beg you to save us from ourselves.
Yours Sincerely,
George Monbiot ++
Americans Driving At Historic Lows
Eleven Billion Fewer Vehicle Miles Traveled in March 2008 Over Previous March
Friday, May 23, 2008
WASHINGTON - Americans drove less in March 2008, continuing a trend that began last November, according to estimates released today from the Federal Highway Administration.
“That Americans are driving less underscores the challenges facing the Highway Trust Fund and its reliance on the federal gasoline excise tax,” said Acting Federal Highway Administrator Jim Ray.
The FHWA’s “Traffic Volume Trends” report, produced monthly since 1942, shows that estimated vehicle miles traveled (VMT) on all U.S. public roads for March 2008 fell 4.3 percent as compared with March 2007 travel. This is the first time estimated March travel on public roads fell since 1979. At 11 billion miles less in March 2008 than in the previous March, this is the sharpest yearly drop for any month in FHWA history.
Though February 2008 showed a modest 1 billion mile increase over February 2007, cumulative VMT has fallen by 17.3 billion miles since November 2006. Total VMT in the United States for 2006, the most recent year for which such data are available, topped 3 trillion miles.
Additionally, the U.S. Department of Transportation estimated that greenhouse gas emissions fell by an estimated 9 million metric tons for the first quarter of 2008.
The estimated data show that VMT on all U.S. public roads have dropped since 2006. The FHWA’s Traffic Monitoring Analysis System (TMAS) computes VMT for all types of motor vehicles (motorcycles, cars, buses and trucks) on the nation’s public roads. These data are collected through over 4,000 automatic traffic recorders operated round-the-clock by state highway agencies. More comprehensive data are published in the FHWA’s “Highway Statistics” at the end of each year.
To review the FHWA’s “Traffic Volume Trends” reports, visit http://www.fhwa.dot.gov/ohim/tvtw/tvtpage.htm.
For “Highway Statistics 2006,” visit http://www.fhwa.dot.gov/policy/ohim/hs06/index.htm. ++
Getting Big Oil to feel our pain
Derrick Z. Jackson, Boston Globe
May 27, 2008
AGAIN, the oily executives of black gold told Congress it gouges Americans to the least extent possible. Again, senators and representatives wagged their fingers at them. Representative Maxine Waters of California told the executives to “share the pain.” Representative Debbie Wasserman Schultz of Florida told them, “I’m a mom of three young children who filled up her minivan the other day for $68 . . . Maybe that’s not real money to the five people sitting here because $68 is like a nickel to you.”
And again, the real story was, despite all that, House Speaker Nancy Pelosi holding a press conference to say “despite a strong case for rescinding taxpayer subsidies for Big Oil, we will have to do that another day . . . because of the opposition of the Republicans in the Senate. So we will do that another day.”
Later in the press conference, Pelosi said, “We will keep making this fight.”
Who will make the fight?
Last year, ExxonMobil made $40.6 billion. In the first quarter of this year, ExxonMobil, Shell, Chevron, ConocoPhillips, and BP America, the five companies that had officials appear before House and Senate committees to cry relative poverty, together made $36 billion in profits. Exxon senior vice president J. Stephen Simon said he made $12.5 million last year. John Lowe, executive vice president of ConocoPhillips, forgot how much he made, saying, “I know it’s on page 36 of the proxy.”
Who is going to be the people’s proxy to tell ExxonMobil and the other companies to stop gouging us? You cannot tell by the money. The oil and gas lobby has showered $639 million on Capitol Hill over the last decade, according to the Center for Responsive Politics. In the current election cycle, the industry is in the top 10 of industries that have already swamped politicians with over $20 million of lobbying efforts each.
In political contributions, the oil companies still lean heavily Republican, obviously in hopes of blocking Democrat-inspired proposals to help consumers. ExxonMobil and Chevron rank second and third, respectively, among oil and gas companies and have so far made $1 million in 2008-cycle contributions, three-quarters of it going to the Republicans.
But make no mistake, they are diversifying their portfolio. Of the top 10 recipients, number five and number six are Democratic presidential candidates Hillary Clinton and Barack Obama. Republican John McCain is number two at $485,526, but his money is easily surpassed by the combined contributions of $628,419 for Clinton and Obama.
At the Senate hearing with Big Oil, Dick Durbin of Illinois asked them, “We’re about to fall into a recession. Does it trouble any of you when you see what you’re doing to us?”
The most could-care-less response was from BP America chairman Robert Malone, who said, “Every week I receive letters from consumers about the impact that high energy prices are having on their everyday lives. Unfortunately, I cannot, and we cannot, change the world market on which this nation now relies on.”
This, by the way, is from one of the few members of Big Oil to give more than 40 percent of its contributions to the Democrats and boast about its wind farms (while drilling in Alaska). If you cannot get anything more from BP than, “Sorry guys, our billions of dollars of profits are held hostage by the world market,” then you know what superpredator Exxon thinks. In fact, Peter Robertson, vice chairman of Chevron, blatantly told the Senate panel, “I feel very proud of what we do.”
Who will wipe the smirk off their faces? We already can guess it will not be a McCain White House. But can you really be certain about an Obama White House, even if the Democrats pick up more seats in Congress? Exxon’s Simon patronized the senators by saying Big Oil’s huge profits “must be viewed in the context of the massive scale of our industry.”
The nation awaits a leader to say, “Sorry Big Oil, you have tipped the scales.” ++
Energy expert: Gas could reach $15 per gallon
David Edwards, Raw Story
Robert Hirsch, senior advisor for Science Applications International Corporation, sat down with MSNBC’s Alex Witt to discuss the possibility of an upcoming oil crisis. Hirsch says that gas could reach $15/gallon within a few years because it is “essentially certain” the world has reached the maximum levels of oil production.
“The problem is that there’s not that much oil left in the ground,” Hirsch says.
“What we’ve done is been very fortunate to have oil production increase as our economies have developed over the past decades. And now we’re reaching a point where we’re about to get, or we may be, at the maximum world oil production.
After that, oil production will then decline and prices, of course, will continue to do what they’ve been doing recently. So what we’ve got today may be the ‘good old days.’”
Hirsch addressed the timeframe in which the US could see $15/gallon gas: “It could happen within a matter of months. It could happen within a matter of a few years. But it’s essentially certain that we are at the maximum of world oil production. And after that, we’ll go into decline, and when there’s much less oil available, then, of course, the price of oil is going to increase dramatically.”
Fuels, heating oil, and consumer products that rely on petroleum will all be impacted by the decline in world oil production. Hirsch estimates the world GDP declining at the same rate as oil production.
[Open link to view] This video is from MSNBC’s News Live, broadcast May 24, 2008. ++
Energy fears looming, new survivalists prepare
SAMANTHA GROSS, Associated Press
Saturday, May 24, 2008
BUSKIRK, N.Y. — A few years ago, Kathleen Breault was just another suburban grandma, driving countless hours every week, stopping for lunch at McDonald’s, buying clothes at the mall, watching TV in the evenings.
That was before Breault heard an author talk about the bleak future of the world’s oil supply. Now, she’s preparing for the world as we know it to disappear.
Breault cut her driving time in half. She switched to a diet of locally grown foods near her upstate New York home and lost 70 pounds. She sliced up her credit cards, banished her television and swore off plane travel. She began relying on a wood-burning stove.
“I was panic-stricken,” the 50-year-old recalled, her voice shaking. “Devastated. Depressed. Afraid. Vulnerable. Weak. Alone. Just terrible.”
Convinced the planet’s oil supply is dwindling and the world’s economies are heading for a crash, some people around the country are moving onto homesteads, learning to live off their land, conserving fuel and, in some cases, stocking up on guns they expect to use to defend themselves and their supplies from desperate crowds of people who didn’t prepare.
The exact number of people taking such steps is impossible to determine, but anecdotal evidence suggests that the movement has been gaining momentum in the last few years.
These energy survivalists are not leading some sort of green revolution meant to save the planet. Many of them believe it is too late for that, seeing signs in soaring fuel and food prices and a faltering U.S. economy, and are largely focused on saving themselves.
Some are doing it quietly, giving few details of their preparations - afraid that revealing such information as the location of their supplies will endanger themselves and their loved ones. They envision a future in which the nation’s cities will be filled with hungry, desperate refugees forced to go looking for food, shelter and water.
“There’s going to be things that happen when people can’t get things that they need for themselves and their families,” said Lynn-Marie, who believes cities could see a rise in violence as early as 2012.
Lynn-Marie asked to be identified by her first name to protect her homestead in rural western Idaho. Many of these survivalists declined to speak to The Associated Press for similar reasons.
These survivalists believe in “peak oil,” the idea that world oil production is set to hit a high point and then decline. Scientists who support idea say the amount of oil produced in the world each year has already or will soon begin a downward slide, even amid increased demand. But many scientists say such a scenario will be avoided as other sources of energy come in to fill the void.
On the PeakOil.com Web site, where upward of 800 people gathered on recent evenings, believers engage in a debate about what kind of world awaits.
Some members argue there will be no financial crash, but a slow slide into harder times. Some believe the federal government will respond to the loss of energy security with a clampdown on personal freedoms. Others simply don’t trust that the government can maintain basic services in the face of an energy crisis.
The powers that be, they’ve determined, will be largely powerless to stop what is to come.
Determined to guard themselves from potentially harsh times ahead, Lynn-Marie and her husband have already planted an orchard of about 40 trees and built a greenhouse on their 7 1/2 acres. They have built their own irrigation system.
They’ve begun to raise chickens and pigs, and they’ve learned to slaughter them.
The couple have gotten rid of their TV and instead have been reading dusty old books published in their grandparents’ era, books that explain the simpler lifestyle they are trying to revive. Lynn-Marie has been teaching herself how to make soap. Her husband, concerned about one day being unable to get medications, has been training to become an herbalist.
By 2012, they expect to power their property with solar panels, and produce their own meat, milk and vegetables. When things start to fall apart, they expect their children and grandchildren will come back home and help them work the land. She envisions a day when the family may have to decide whether to turn needy people away from their door.
“People will be unprepared,” she said. “And we can imagine marauding hordes.”
So can Peter Laskowski. Living in a woodsy area outside of Montpelier, Vt., the 57-year-old retiree has become the local constable and a deputy sheriff for his county, as well as an emergency medical technician.
“I decided there was nothing like getting the training myself to deal with insurrections, if that’s a possibility,” said the former executive recruiter.
Laskowski is taking steps similar to environmentalists: conserving fuel, consuming less, studying global warming, and relying on local produce and craftsmen.
Laskowski is powering his home with solar panels and is raising fish, geese, ducks and sheep. He has planted apple and pear trees and is growing lettuce, spinach and corn.
Whenever possible, he uses his bicycle to get into town.
“I remember the oil crisis in ‘73; I remember waiting in line for gas,” Laskowski said.
“If there is a disruption in the oil supply it will be very quickly elevated into a disaster.”
Breault said she hopes to someday band together with her neighbors to form a self-sufficient community. Women will always be having babies, she notes, and she imagines her skills as a midwife will always be in demand.
For now, she is readying for the more immediate work ahead: There’s a root cellar to dig, fruit trees and vegetable plots to plant. She has put a bicycle on layaway, and soon she’ll be able to bike to visit her grandkids even if there is no oil at the pump.
Whatever the shape of things yet to come, she said, she’s done what she can to prepare. ++
“So keep fightin’ for freedom and justice, beloveds, but don’t you forget to have fun doin’ it. Lord, let your laughter ring forth. Be outrageous, ridicule the fraidy-cats, rejoice in all the oddities that freedom can produce. And when you get through kickin’ ass and celebratin’ the sheer joy of a good fight, be sure to tell those who come after how much fun it was.”
~ Molly Ivins, 1944 - 2007
In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes.
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