tag:blogger.com,1999:blog-5235419263414453422.post2681732850735574107..comments2024-02-23T01:30:06.101-08:00Comments on Early Warning: Global Oil Supply Now Contracting?Stuart Stanifordhttp://www.blogger.com/profile/07182839827506265860noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-5235419263414453422.post-11218528322673860632010-07-31T16:18:59.702-07:002010-07-31T16:18:59.702-07:00If you stand back and look at the chart with the p...If you stand back and look at the chart with the purple, plum and green curves, it looks like the long-term, smoothed-out line for production is approaching (or is just at) a peak. Hm-m-m... is that why they call it Peak Oil?<br /><br />So the trade off seems to be:<br /><br />1. Stay in recession and use less oil (letting the price of oil remain lower than it might have otherwise been) for a few more years, and then start running out, or<br /><br />2. End the recession, start using more oil, pay higher prices starting now rather than later, and then run out of oil just a little sooner.<br /><br />Does that pretty much sum up our predicament? That self-sufficient rural retreat with the windmill and solar panels is looking better and better every day...MisterMoosehttps://www.blogger.com/profile/14484672208906420595noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-37036475086276417392010-07-29T12:42:08.158-07:002010-07-29T12:42:08.158-07:00Should have said "3-5% annual drop in global ...Should have said "3-5% annual drop in global *demand*..." Efficiencies will supplement productiviy losses in decreasing demand.Unknownhttps://www.blogger.com/profile/16405290282490340535noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-11401486162585743272010-07-29T11:59:54.730-07:002010-07-29T11:59:54.730-07:00The one thing about Hubbert I don't buy is the...The one thing about Hubbert I don't buy is the demand side. We've seen what a temporary 5% drop in global productivity can do to slow production, and I'm assuming that demand relationship will have a mitigating effect on the speed of declining oil production. What I'm stuck on is how things will operate at a sustained 3-5% annual drop in global productivity to maintain, say, 8-10 more years of an oil production plateau.Unknownhttps://www.blogger.com/profile/16405290282490340535noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-5368131104672708852010-07-28T07:09:32.978-07:002010-07-28T07:09:32.978-07:00Is oil poised to make another run at $90 a barrel?...Is oil poised to make another run at $90 a barrel?<br /><br />Recall in May when both stocks and commodities (along with gold) were making bull runs before the Greek Debt Crisis pulled the plug. Or, was it the $87 oil that pulled the plug?<br /><br />The big question is whether there is enough money in the various economies to support $90 oil? You will notice that the highest trend prices over time since Summer of 2008 have declined from +$145 to +$87 to the current +$78. The trend is lower highs, suggesting less funds available for oil over time: the world is becoming poorer.<br /><br /><br />http://economic-undertow.blogspot.com/2010/07/watching-oil-market.htmlSteve From Virginiahttps://www.blogger.com/profile/04002636865996847926noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-28612372319847810992010-07-27T14:01:46.374-07:002010-07-27T14:01:46.374-07:00And here is an today interview with JE Stiglitz - ...And here is an today interview with JE Stiglitz - he seems to be more in real world than Krugman, although still quite optimistic:<br /><br />Troubles ahead for world economy:<br /><br />http://www.abc.net.au/7.30/content/2010/s2965891.htm#Alexander Achttps://www.blogger.com/profile/16845172528191878930noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-6005530480372493582010-07-27T13:41:58.984-07:002010-07-27T13:41:58.984-07:00Hi Stuart,
I tend to agree with Greyzone. That th...Hi Stuart,<br /><br />I tend to agree with Greyzone. That the supposed recovery is largely based in the debt (growing faster than GDP, see also China). And thus, it is unsustanable recovery :-)<br /><br />best,<br />AlexAlexander Achttps://www.blogger.com/profile/16845172528191878930noreply@blogger.comtag:blogger.com,1999:blog-5235419263414453422.post-66191788288787105642010-07-27T08:10:09.204-07:002010-07-27T08:10:09.204-07:00There never really was a real end to the Great Rec...There never really was a real end to the Great Recession, Stuart. We had what appears to be an 11% surge in "stimulus" which resulted in GDP numbers of 3% or so, meaning the real economy was probably still contracting by 8% or so during that time.<br /><br />With the end of government stimulus or any significant cutback in the same, the contraction will resume in earnest.<br /><br />People had simply acquired as much debt as they could possibly service, even in the best of times. Debt can only be (a) paid off, (b) defaulted, or (c) forgiven. Given the "jobless recovery" (what an oxymoron!!), I fully expect the rate of foreclosure to remain high, the rate of credit card charge offs to remain high, and for banks to hold cash in anticipation of future loan losses.<br /><br />In fact, at the current rate of bank closures, we will have more bank closures in this "recovery" year than we had during the supposed height of the Great Recession. And I expect it to get worse as all we have done is transfer the bad debt largely from private hands to government hands around the world.<br /><br />There will be further sovereign debt crises around the world over the next 24 months and there may even be a few sovereign defaults.<br /><br />Against this backdrop, oil production can do little other than decline, regardless of what the actual reserve situation really is. And if peak oil is rearing its head, it will definitely complicate any genuine recovery once the debt load is brought back down to manageable levels.Anonymousnoreply@blogger.com