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Lying? lol
I would beg to differ just a bit.
http://www.tradingeconomics.com/saud...r-wb-data.html
The Saudi government subsidizes the price of gasoline. It can do so because it produces so damn much of the stuff.
Drill all you want offshore in the US, and in ANWAR.
It will not make a 's worth of difference in the global picture, or even for US consumers.
Anybody who tells you differently is lying to you.
AS THE developed-world economy tries to gain momentum, it faces a persistent headwind. The oil price remains stubbornly over $100 a barrel, acting like a tax on Western consumers. Some blame the high price on evil speculators—Barack Obama unveiled plans to increase penalties for market manipulation on April 17th. But there is a simpler explanation: that supply is inadequate to keep up with rising demand.
The concept of peak oil—the idea that global crude production may be at, or close to, its limit—is far from universally accepted. One leading asset manager talked recently of the world being “awash with energy” because of the exploitation of American shale gas. Nevertheless, oil is still the main fuel for cars and trucks. And crude output (as opposed to alternatives such as biofuels and liquids made from gas) has been flat since 2005.
A number of countries (including Britain, Egypt and Indonesia) have turned from net oil exporters into importers in recent years. And although rich countries have curbed their energy-guzzling a little, demand continues to surge in emerging markets.
This has left the oil market very vulnerable to temporary supply disruptions, such as the war in Libya. Speaking at a conference in Dublin this week, organised by the Ins ute of International and European Affairs and the Association for the Study of Peak Oil and Gas, Chris Skrebowski, a consulting editor of Petroleum Review, argued that spare capacity in the oil market could be eroded by 2015.
The peak-oil concept was devised by the late M. King Hubbert, who correctly predicted in 1956 that oil output in the lower 48 states of America would peak by around 1970. At the conference Michael Kumhof, an economist at the International Monetary Fund, presented the findings of a forthcoming working paper which showed that adding the idea of a “Hubbert peak” to energy production greatly improved the ability of a model to forecast oil prices. Based on an expected 0.9% annual increase in production over the next decade, the model predicts that real oil prices will nearly double over the same period.
The economic damage caused by such a rise is predicted to be modest, perhaps 0.2% of global GDP a year. In the past changes in oil prices have had a limited long-term impact, since any losses to oil importers are matched by gains by oil exporters. To the extent that high oil prices played a role in the recessions of the early 1980s and 2008-09, the main reason is that oil-producing countries tend to have a lower marginal propensity to consume their income, denting global demand.
Nevertheless, Mr Kumhof worries that if oil prices are high enough, the economic impact might increase substantially. On the most extreme assumptions, it could be 2% a year. [I believe it will be weighted towards the upper end of the scale-RG]
Even if the world can find more oil—in the Arctic or tar sands, say—the longer-term question is whether the era of “cheap energy” is over and how the world can adjust if it is. Developed economies are built on easy access to cheap energy, importing goods that are transported from around the world, with consumers driving many miles to work in air-conditioned offices and then flying off to sunny climes for their annual holidays. Persistently high oil prices would clearly lead to subs ution (electric cars, natural-gas-powered trucks) but the transition costs could be significant.
Furthermore some potential subs utes for, or new sources of, oil (such as biofuels and tar sands) are a lot less efficient, in the sense that they require significant amounts of energy simply to produce. To the extent that this equation (energy return on energy invested, or EROI) is deteriorating, that must surely have an effect on economic growth.
“What is the minimum EROI that a modern industrial society must have for its energy system for that society to survive?” ask Carey King and Charles Hall in a recent paper*. The academics’ answer: “Complex societies need a high EROI built on a large primary energy base.”
This issue is not much considered by mainstream economists, who are too busy focusing on monetary policy, the impact of fiscal austerity or the need for labour-market reforms. But just as the industrial revolution was built on coal, the post-second-world-war economy was built on cheap oil. There will surely be a significant impact if it has gone for good.
Lying? lol
I would beg to differ just a bit.
http://www.tradingeconomics.com/saud...r-wb-data.html
The Saudi government subsidizes the price of gasoline. It can do so because it produces so damn much of the stuff.
What does that have to do with the OP?Lying? lol
I would beg to differ just a bit.
http://www.tradingeconomics.com/saud...r-wb-data.html
The Saudi government subsidizes the price of gasoline. It can do so because it produces so damn much of the stuff.
(edit)
More importantly, how does the price of gasoline in a small country like Saudi Arabia, have anything to do with the global price of oil, or proving that increasing US drilling will make a difference in that global price?
The Saudi's just don't consume much of their own product relative to the West plus Asia.
Really not sure what you are saying here.
The US only produces 10% of the world's oil. Doubling production tomorrow would bring that to 19%, setting aside the fact would require magic cloning of billion dollar rigs, people to operate them, and data good enough to tell them where exactly to drill.
I just don't see the link.
Last edited by RandomGuy; 04-26-2012 at 10:29 AM.
"....or even for US consumers"
I was just drawing the conclusion that since they do in fact produce so much oil, the revenue from said production allows the gov to subsidize the price to it's citizens. Ergo, if the US nationalized their production, they could conceivably do the same thing on a much smaller scale.
Doubling our production would still not supply the US with all the oil it consumes.
Further, demand is growing fast elsewhere.
You would have to 1) nationalize it, and 2) prohibit that oil from being sold to the global market if prices rise enough which appears probable.
Neither would be likely.
Drilling may not be the long, long-term solution, but it sure is helping our local economy right now. You could take my word for it, or just drive through the various towns along the Eagle Ford shale.
lol trying to stop someone from profiteering...
seriously opec and clowns who have an interest in oil dont give a about the consumer when it comes to high prices, cause ppl will still pay for it; until its too expensive they will opt for the alternative
... you do know the gas you put in your tank is not the gas that is being drilled at Eagle Ford, right?
You do know that drilling produces local revenue, right?
Yes, I do. Given that Darrin started blathering about what is primarily natural gas in a thread about oil, I wasn't sure if he knew. His track record when it comes to making coherent arguments is, um, less than stellar.
But hey, since we are going on about the benefits, here comes the cost shifting... (i.e. negative externalities)
Roads Killed: Texas Adds Up Damages from Drilling
... and when the speculative bubble bursts from the glut, I wonder what happens to those revenues? Yet another hidden cost.Texas could be looking at spending possibly hundreds of millions of dollars for road repairs and improvements to cope with the surge in oil and gas drilling.
“We have a task force [that] in the next 90 days is going out and talking to all the partners involved in the activity to see what we can do,” Mark Cross, spokesperson for the Texas Department of Transporation (TxDOT) told StateImpact Texas.
I think he took his time to stake his position clearly. It might be an outlier.
The cost of rebuilding roads pales in comparison to the monies poured into the local economies. There are only about a zillion examples of this IRL. Pick any town in West Texas.
Yup. I do realize this, for now.I think he took his time to stake his position clearly. It might be an outlier.
The cost of rebuilding roads pales in comparison to the monies poured into the local economies. There are only about a zillion examples of this IRL. Pick any town in West Texas.
FIgure the odds that enough money was set aside in that to fix the roads, so when the bubble bursts, that revenue will be a LOT less.The Texas Oil and Gas Association is well aware of the road conditions and concerns that have emerged alongside incredible economic activity and commerce in Texas,” said Mari Ruckel, the association’s Director of Public Affairs.
While Ruckel said the association has formed its own committee to look at what the industry can do to address the road issue, she said that oil and gas producers were already paying substantially into government coffers. She said that in 2010 alone, they paid $7.4 billion in Texas severance taxes, local property taxes and royalties.
Roads aren't quite the only infrastructure cost involved, but it is the most obvious.
"high prices, cause ppl will still pay for it"
some people are very sensitive to gas price.
a gas war in San Antonio now, people waiting in line 30 minutes to pay 3.30 instead of 3.80.
lol...I'm not putting any money on our illustrious legislators or TxDot laying anything back outta that revenue.
What determines energy abundance? Flow.
Energy abundance depends entirely on the RATE of energy flow. Let me say it again: Energy abundance depends entirely on the RATE of energy flow.
Now, here is what it does NOT depend on: supposed, but often unverified, fossil fuel reserves in the ground; hypothetical, sketchy, guesstimated, undeveloped, undiscovered resources imagined to be in the ground by governments or by energy companies and often deceptively referred to as "reserves"*; claims about future technological breakthroughs; mere public relations puffery about abundance in the face of record high average oil prices.
Why is the rate of flow the key metric? Because in order to function the global economy depends entirely on continuous, high-quality energy inputs. We cannot shut down the world's electric generating plants for six months or even three months without crashing world society into a state of irretrievable chaos and decline. We cannot shut down the world's shipping fleet for even a few weeks without doing irreparable harm. Modern global society has become like a shark. It either keeps barreling forward or it dies.
Fossil fuels that are actually proven to be in the ground are by definition not currently being used, whatever we may consider their potential. Fossil fuels that are hypothetical and undiscovered by definition cannot be used. Technology is NOT energy. Technology runs ON energy. Energy first, then applied technology. The ancient Romans designed and built small steam engines and used them to animate children's toys. But, the Romans lacked the dense energy sources needed to make steam engines practical as a mode of transportation or of power for manufacturing.
Now, why am I making such a fuss about all this? Because this week we have yet another entry in the ongoing energy misinformation derby, this time from the usually sensible Atlantic Monthly magazine. In fairness, the headline on the magazine's cover which reads "We will never run out of oil" was probably not chosen by the author for it does not really respect the nuances found in the piece which inside has the only slightly less disinformational headline: "What If We Never Run Out of Oil?" The subheading makes the astounding claim that fossil fuels may not be finite making me believe that the editors didn't actually read their own story.
http://www.csmonitor.com/Environment...All+Stories%29
well......Fire and Police....Roads aren't quite the only infrastructure cost involved, but it is the most obvious.
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