Spring Break – Kunstler

Last week, I was in Illinois walking the majestic Beaux Arts-vintage main quad of the State U in Champaign-Urbana. The flowering trees were in full bloom, the grass was green and speckled with dandelions, and the leaves on the privet hedges were unfurling. Then I came home to upstate New York where everything is brown, gray, and dead-looking, and humps of snow still remain on the north side of every building. I called the heating oil man to get 100 gallons because our tank was close to running on fumes and the daily high temperature lingered in the 30s.

This is the flip side of the abnormally warm early winter we had. The jet stream, for whatever reason, has pulled a flag of frigid air over the northeast US, the region which proportionately uses the most oil for home heating, as opposed to natural gas. The weather forecast says they see frigid days and nights as far ahead as they dare to look.


Gasoline use typically shoots up around this time of year as spring breakers hit the road. Meanwhile, US Department of Energy’s EIA reports that US refinery inputs are 115,000-barrels-a-day short of their 15-million-barrel-a-day “threshold” (which I take to mean their required capacity to keep things humming), while imported gasoline supplies (we get some of that, too) also fell short. The EIA’s monthly report concludes: “…consequently, as gasoline demand began to grow in earnest in April, gasoline supply has failed to keep pace, resulting in continued significant stock declines and sharp upward pressure on gasoline prices in recent weeks.” Gasoline prices are now 11.9 cents per gallon higher than at this time last year.

The EIA has to be more reality-based about current activity than their future projections, because the current import-export and refinery figures are out there for other people and other data-gathering organizations to see. The EIA’s future projections are a joke. They are based on the fantasy that everything will be okay despite what we see happening now. The EIA projects that all the world’s oil producers will increase their oil production hugely by 2030. They see Saudi Arabia shooting up to 17.1 million barrels a day when, in fact, Saudi production fell 7 percent just over the past year alone to 8.4 mm/b/d. They see Mexico shooting way up, despite the announcement last year by Pemex that the Cantarell field (60 percent of Mexico’s total production) is crashing at a minimum rate of 15 percent a year. They see Russia zooming way up, despite the fact that Russia is probably past the 70 percent mark of its original total reserves. If you go to this EIA chart, you’ll see practically everybody’s production shooting way up in the decades ahead, even the US, which, in reality, has seen nothing but steady annual decline for more than thirty years (we produce half now of what we did in 1970).

Atlantic Free Press