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2012: Demand Exceeds Supply

General discussions of the systemic, societal and civilisational effects of depletion.
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Re: 2012: Demand Exceeds Supply

Unread postby AirlinePilot » Sat 01 May 2010, 17:35:40

$this->bbcode_second_pass_quote('shortonsense', 'I') deny censored discovery graphs, bet your butt, I like data, REAL data, not the kind shoveled around the peaker community as "proof" of some scenario.


There is no "REAL" data, its all manipulated and if you dont understand that now, then no wonder you think everything is going to be fine.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sat 01 May 2010, 17:39:14

$this->bbcode_second_pass_quote('Ludi', '')$this->bbcode_second_pass_quote('shortonsense', ' ')I still buy as much premium gas as I need for the wifes sports car



I know zip about economics, but isn't there a kind of rationing based on price? You seem to be saying that as long as the upper strata of income earners can afford gas, there's plenty of gas in the economy.


I suppose we could get into a full blown debate on the basics of economics, maybe get Tyler in here to keep us all honest, but to some extent sure, oil is as much about economics as...copper, uranium, natural gas, any mineral resource.

America as a country consumes far more than its share of oil...why? Because its richer and can use a fossil fuel which is barely affordable to the average Zimbabwean as the fuel to push 2 tons of steel plus a single person around to their kids soccer game.

So right there is rationing based on price, applied globally. It has nothing to do with the actual fuel as much as who can AFFORD it...and it was the same in 1925 as it is today.

The beauty of economics....works from discovery to peak, during peak, and long after peak has come and gone.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sat 01 May 2010, 18:14:36

$this->bbcode_second_pass_quote('AirlinePilot', '')$this->bbcode_second_pass_quote('shortonsense', 'C')ertainly I must disagree with this statement, its implications and assumptions, and its disregard for the power of efficiency and behavioral change.

I still buy as much premium gas as I need for the wifes sports car, and call me crazy but I'm betting you still buy fuel for your own personal aircraft, let alone the ones you fly professionally.


All your observations will change when real decline sets in after we move off the plateau short. Why would you expect some sort of cataclysm of doom to befall us while we are on it?


I expected a cataclysm of Doom when peak oil happened because I was told it would happen by the experts who predicted Doom in the first place. Then as part of my due diligence on the topic I began checking all the OTHER peaks and Dooms and "running out" claims spanning a century or two and realized that this has all happened before. Except those effects were worse of course and involved all the stuff we haven't seen yet, like rationing and shortages and such.

$this->bbcode_second_pass_quote('airlinepilot', '
') I still buy fuel for my plane but ITS MORE EXPENSIVE NOW THAN IT HAS EVER BEEN IN . It IS hurting General aviation. Choose not to see it but Im right here telling you that it is having an effect NOW.


Sure its having an effect....just like more expensive gasoline has an effect. Thats what price is SUPPOSED to do...have an effect. As far as "hurting" general aviation, well, thats an opinion. For example, it appears that avgas consumption has been going down for years. And 20 of those years were pre-peak oil.

So something certainly has been causing people to use less avgas...call me crazy...but I'm betting its something other than price, and certainly has NOTHING to do with the most recent peak oil. Unless you think this is all a consequence of the peak oil back in 1979? The data on this page only goes to the early 80's, so its hard to say.

http://tonto.eia.doe.gov/dnav/pet/hist/ ... 600001&f=M

$this->bbcode_second_pass_quote('airlinepilot', '
') I see little chance that we will attain efficiencies and new technologies in any real magnitudes to offset decline. We wont go there until its forced on us. Its just human nature.


I can agree with this. When we are forced to...we will all go find a way to buy a Volt, and the price of gasoline won't bother us much anymore. Perfectly acceptable economics in action in my book.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sat 01 May 2010, 18:22:20

$this->bbcode_second_pass_quote('AirlinePilot', '')$this->bbcode_second_pass_quote('shortonsense', 'I') deny censored discovery graphs, bet your butt, I like data, REAL data, not the kind shoveled around the peaker community as "proof" of some scenario.


There is no "REAL" data, its all manipulated and if you dont understand that now, then no wonder you think everything is going to be fine.


I understand manipulated data, and I understand real data, and I understand that sometimes "real" data isn't all its cracked up to be.

However, systematic exclusion of information to make something into something it is not....thats another matter entirely.

For example, whats been done with Peak discovery graphs is no different than collecting temperature data outside my house from 6AM to Noon....and then presenting it as evidence that temperature only goes up...while not mentioning what a full 24 hours of temperature data would show. Anyone who saw the 24 hour data would know that temperatures go up...and then go down as well. If your intent is to talk about only increasing temperatures, and then rigging the data to show only that...naughty naughty. What happens to peaker credibility when they pull this kind of stunt? Right out the damn window, thats what happens.
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Re: 2012: Demand Exceeds Supply

Unread postby AirlinePilot » Sat 01 May 2010, 22:35:45

$this->bbcode_second_pass_quote('shortonsense', 'S')o something certainly has been causing people to use less avgas...call me crazy...but I'm betting its something other than price, and certainly has NOTHING to do with the most recent peak oil.


Ok your crazy. The ONLY reason I see is rationing due to price. This will translate to normal uses also, we just haven't started the real decline yet to make it hurt enough.
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Re: 2012: Demand Exceeds Supply

Unread postby AirlinePilot » Sat 01 May 2010, 22:44:25

$this->bbcode_second_pass_quote('shortonsense', 'I') can agree with this. When we are forced to...we will all go find a way to buy a Volt, and the price of gasoline won't bother us much anymore. Perfectly acceptable economics in action in my book.


I believe this is where your entire argument folds short. We wont do it. The masses wont be able to afford the cost. This is about SO much more than affording an Electric vehicle. I wont do it and I'm on the upper end of being able to afford to buy one with CASH. There are far better uses for my money now which involve being prepared for the coming monetary and energy woes which befall us without real and aggressive attempts at mitigation.

What you still refuse to understand or address is the tie in with our monetary system and PO. Dwindling production of the main resource used to create growth...and therefore money... is ceasing. The entire paradigm fails under the weight of that declining (and no longer cheap) resource our fiat money system is based on.

That's why this will all be different than all those previous "peaks" you keep talking about.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sun 02 May 2010, 10:20:07

$this->bbcode_second_pass_quote('AirlinePilot', '')$this->bbcode_second_pass_quote('shortonsense', 'S')o something certainly has been causing people to use less avgas...call me crazy...but I'm betting its something other than price, and certainly has NOTHING to do with the most recent peak oil.


Ok your crazy. The ONLY reason I see is rationing due to price. This will translate to normal uses also, we just haven't started the real decline yet to make it hurt enough.


You didn't address the point. Avgas useage has been going down for DECADES. Why? Because the general aviation industry has been getting wonderfully better..until only recently? Certainly this isn't a reasonable assumption based on their fuel consumption behavior.

General aviation has been cutting back on fuel use way before "the final" peak oil came along. Certainly if the real price of avgas has been increasing since the early 80's you can argue that price has been a factor...you just can't argue that price has anything to do with peak oil a few years back.
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Re: 2012: Demand Exceeds Supply

Unread postby SeaGypsy » Sun 02 May 2010, 10:30:10

Japanese made motorcycles with 125cc engines retail in Asia for well under $1k USD, Chinese ones for half that. Put a sidecare on and they can move 4 people at 50mph doing 100mpg+. Not very classy by American standards, but they are transport and they can reduce demand in a big way.

http://images.google.com.ph/images?hl=t ... =&gs_rfai=

And if us westerners don't like it, well that's Ok, as long as it's OK that Asia is far more efficient.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sun 02 May 2010, 10:31:25

$this->bbcode_second_pass_quote('AirlinePilot', '')$this->bbcode_second_pass_quote('shortonsense', 'I') can agree with this. When we are forced to...we will all go find a way to buy a Volt, and the price of gasoline won't bother us much anymore. Perfectly acceptable economics in action in my book.


I believe this is where your entire argument folds short. We wont do it. The masses wont be able to afford the cost.


The average price of a car in America is what, $25G's? The Leaf is MSRP'd at $33G's, not counting any subsidies which might be included? The Volt is expected to be $40G's, maybe $33G's with tax credits?

You think the $8G's in addition cost, financed over say 5 years, in exchange for negligible fuel costs ( in the $6/gal, permanently increasing peak oil scenario you seem to advocate )WON'T be done...why? Because people refuse to exchange an extra $150/month in capital cost for a lack of $150/month ( 25 gal month @ $6/gal ) in fuel costs? For all intents and purposes, there is NO difference in cost.

$this->bbcode_second_pass_quote('airlinepilot', '
') What you still refuse to understand or address is the tie in with our monetary system and PO. Dwindling production of the main resource used to create growth...and therefore money... is ceasing. The entire paradigm fails under the weight of that declining (and no longer cheap) resource our fiat money system is based on.


I don't think its a refusal to understand, its a ridiculous speculation that I simply don't fall for. The US imports about the same amount of oil now as it did during the 70's....no growth in input...yet the country and GDP has grown quite a bit. Seems to contradict your requirement for growth right out of the box.

My opinion is that once peak oil didn't do what was assumed of it, that it would cause shortages and rationing and such, the peakers cast around for some other thing to attach their hysterical consequences to...and for some reason landed on fiat money. Interesting, but certainly not a given link by any stretch of the imagination, and certainly not backed up by peak demand some years ago in other developed countries.

$this->bbcode_second_pass_quote('airlinepilot', '
') That's why this will all be different than all those previous "peaks" you keep talking about.


Are you claiming that we didn't have fiat money from 1979 to 1985....when production was suffering some of those "real declines" you go on about, yet the economy grew as well?
Last edited by shortonsense on Sun 02 May 2010, 11:26:09, edited 1 time in total.
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Re: 2012: Demand Exceeds Supply

Unread postby Ludi » Sun 02 May 2010, 11:07:04

$this->bbcode_second_pass_quote('shortonsense', ' ')For all intensive purposes



For say.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sun 02 May 2010, 11:26:54

$this->bbcode_second_pass_quote('Ludi', '')$this->bbcode_second_pass_quote('shortonsense', ' ')For all intensive purposes



For say.


Yeah, you aren't the only one who pointed it out. I fixed it.
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Re: 2012: Demand Exceeds Supply

Unread postby vtsnowedin » Sun 02 May 2010, 11:33:29

$this->bbcode_second_pass_quote('shortonsense', '[')
The average price of a car in America is what, $25G's? The Leaf is MSRP'd at $33G's, not counting any subsidies which might be included? The Volt is expected to be $40G's, maybe $33G's with tax credits?

You think the $8G's in addition cost, financed over say 5 years, in exchange for negligible fuel costs ( in the $6/gal, permanently increasing peak oil scenario you seem to advocate )WON'T be done...why? Because people refuse to exchange an extra $150/month in capital cost for a lack of $150/month ( 25 gal month @ $6/gal ) in fuel costs? For all intensive purposes, there is NO difference in cost.


If gas goes to $6/gal then the alternatives like the Volt will jump in price to keep demand for them in line with supply. Witness the Prius two years ago when gas got briefly to $4.00. And the government will see no need to keep tax breaks when they are struggling with supply shortages themselves. Expect 50Gs on the free market.
Six dollar plus gas in constant dollars makes many American suburban lifestyles untenable and for the majority of suburbs that no longer or never had working commuter train service the only options are packed buses or moving back into town. Quite an upheaval there that will take years to sort out and the expected wild swings in price will keep confusing people on their best course. A little chaos seems a safe prediction.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sun 02 May 2010, 14:57:24

$this->bbcode_second_pass_quote('vtsnowedin', '')$this->bbcode_second_pass_quote('shortonsense', '[')
The average price of a car in America is what, $25G's? The Leaf is MSRP'd at $33G's, not counting any subsidies which might be included? The Volt is expected to be $40G's, maybe $33G's with tax credits?

You think the $8G's in addition cost, financed over say 5 years, in exchange for negligible fuel costs ( in the $6/gal, permanently increasing peak oil scenario you seem to advocate )WON'T be done...why? Because people refuse to exchange an extra $150/month in capital cost for a lack of $150/month ( 25 gal month @ $6/gal ) in fuel costs? For all intensive purposes, there is NO difference in cost.


If gas goes to $6/gal then the alternatives like the Volt will jump in price to keep demand for them in line with supply. Witness the Prius two years ago when gas got briefly to $4.00. And the government will see no need to keep tax breaks when they are struggling with supply shortages themselves. Expect 50Gs on the free market.


But thats not what happened with the Prius. I could still buy one MSRP during the 2008 runup ( I know this because I tried ) I would simply have been in line which was about 4 months long at the time. If it were some other item, I might agree with you, but manufacturers of automobiles don't always gouge as badly as, say, convenience stores with gasoline post-hurricane.

Also, I don't agree with AirlinePilot who appears to imply that $6/gal is devastating, when in fact it isn't even as expensive as what Europeans pay for fuel. Certainly I consider myself already prepared for $6/gal even without a Volt. I would find $6/gal irritating. I might consider the Volt preparation for $10/gal, at that price I would be irritated at filling up the motorcycle, and my capital investment strategies follow my irritation.

$this->bbcode_second_pass_quote('vtsnowedin', '
') Six dollar plus gas in constant dollars makes many American suburban lifestyles untenable and for the majority of suburbs that no longer or never had working commuter train service the only options are packed buses or moving back into town.


So behavioral changes save the day...again. My suburban lifestyle works fine with $6/gal, so I don't understand why you think all suburbs might be untenable? The suburbs take alot of heat in the peaker debate, and I've never understood why except for the more ridiculous examples provided by LA where people specialized in "driving till they qualified" which has nothing to do with peak oil and everything to do with people being stupid about their commuting cost and time.

$this->bbcode_second_pass_quote('vtsnowedin', '
')Quite an upheaval there that will take years to sort out and the expected wild swings in price will keep confusing people on their best course. A little chaos seems a safe prediction.


Wild swings in price are good. Businesses, and people, will make decisions on the uncertainty of fuel costs, and will buy houses and commuting vehicles accordingly. The only thing better than volatility is the government putting a floor under the price, taxing all gasoline to, say, $6/gal or something like the Europeans do. That would provide a decent amount of stability for everyone, mass transport, car manufacturers, housing. Unlikely that such a practical solution would happen in America though.
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Re: 2012: Demand Exceeds Supply

Unread postby Ludi » Sun 02 May 2010, 15:01:23

$this->bbcode_second_pass_quote('shortonsense', 'C')ertainly I consider myself already prepared for $6/gal even without a Volt. I would find $6/gal irritating. I might consider the Volt preparation for $10/gal, at that price I would be irritated at filling up the motorcycle, and my capital investment strategies follow my irritation.



What is your annual income?

I just need a point of comparison here with someone who can run out and buy a Prius (or a Volt). Just curious to know the kind of income level we're talking about.

Thanks.
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Re: 2012: Demand Exceeds Supply

Unread postby AirlinePilot » Sun 02 May 2010, 15:22:19

$this->bbcode_second_pass_quote('shortonsense', 'A')re you claiming that we didn't have fiat money from 1979 to 1985....when production was suffering some of those "real declines" you go on about, yet the economy grew as well?



As Ive said before back then it was evident, supportable, and reliable that oil production would grow and grow significantly. That IS changing whether you acknowledge it or not. It IS why price for crude is increasing. My point is that soon, maybe right now, there will be a realization that this paradigm will not continue. Oil production will begin to decline and likely forever. At what rate I dont claim to profess, but I have an idea.

For those who deny that this is coming their argument (and yours) is supportable. If you agree that it can and will decline forever, then it is not.

Im in that second camp, that's all.... your not, I get it.

Fiat money, without some form of support to allow it to continue..which means growth...will fail. All Fiat money systems since time began at some point have failed. Why is it so hard to believe that ours can now? I'm not one to turn away from the lessons of history short, I dont believe you are either.

Without a direct replacement for cheap oil (which it is NOT now) this situation will correct itself.
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Re: 2012: Demand Exceeds Supply

Unread postby vtsnowedin » Sun 02 May 2010, 18:28:40

$this->bbcode_second_pass_quote('shortonsense', '[')
$this->bbcode_second_pass_quote('vtsnowedin', '
') Six dollar plus gas in constant dollars makes many American suburban lifestyles untenable and for the majority of suburbs that no longer or never had working commuter train service the only options are packed buses or moving back into town.


So behavioral changes save the day...again. My suburban lifestyle works fine with $6/gal, so I don't understand why you think all suburbs might be untenable? The suburbs take alot of heat in the peaker debate, and I've never understood why except for the more ridiculous examples provided by LA where people specialized in "driving till they qualified" which has nothing to do with peak oil and everything to do with people being stupid about their commuting cost and time.


I speak from the experience of commuting 100 miles a day minimum for thirty plus years on an income that was just paying the bills if the wonderful wife's job kicked in a bit. Lets see now 2400 miles a month at twenty miles per gallon (can't afford a new one have to take the best beater you can find for what's in the check book) meant 120 gallons at $2.00 per gallon or $240 per month plus repairs tires and oil changes. Bump that up to six bucks per gallon and your at $720+/ month. What do you take the extra $480 per month out of? The groceries? The credit card payments? The mortgage? Oh yah the entertainment budget glad I thought of it.
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Re: 2012: Demand Exceeds Supply

Unread postby sparky » Sun 02 May 2010, 19:30:37

.

An often ignored fact is that producing countries internal demand is rising
the number for oil produced are not the story ,
the story is the oil available to be exported

the most striking example is Saudi Arabia
in a recent speech Khalid A. Al-Falih
Saudi Aramco President and Chief Executive Officer stated

".... If no efficiency improvements are achieved, and the business is as usual, the oil availability for exports is likely to decline to less than 7 million barrels per day by 2028, a fall of 3 million barrels per day while the global demand for our oil will continue to rise. "

Riyadh, Saudi Arabia, April 19, 2010

http://wwwp.saudiaramco.com/irj/portal/ ... Apr19.html
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Re: 2012: Demand Exceeds Supply

Unread postby Ludi » Sun 02 May 2010, 19:37:09

$this->bbcode_second_pass_quote('vtsnowedin', '
')I speak from the experience of commuting 100 miles a day minimum for thirty plus years on an income that was just paying the bills



According to Shorty, you should have had a higher-paying job. Then $6 gas would at worst be "irritating."

Why didn't you plan ahead to be in the top income quintile? Everyone should be!
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sun 02 May 2010, 19:42:04

$this->bbcode_second_pass_quote('Ludi', '')$this->bbcode_second_pass_quote('shortonsense', 'C')ertainly I consider myself already prepared for $6/gal even without a Volt. I would find $6/gal irritating. I might consider the Volt preparation for $10/gal, at that price I would be irritated at filling up the motorcycle, and my capital investment strategies follow my irritation.



What is your annual income?


My peak oil preps from the 1979 peak have paid off better than expected over the years. I consider myself solidly middle class. And yes, I am aware that this socio-economic level allows me more freedom to make capital investments to reduce operating costs, which might not be a plan for everyone.

$this->bbcode_second_pass_quote('Ludi', '
')I just need a point of comparison here with someone who can run out and buy a Prius (or a Volt). Just curious to know the kind of income level we're talking about.
Thanks.


It seems to me that someone paying $350/month + $200/month in fuel can afford to pay $450/month + $100/month in fuel, without being particularly far up the socio-economic food chain. Secretary at work drives a Prius for example. Certainly doesn't require my level of income to acquire one. And if the Volt is $550/month but gasoline costs disappear....we haven't changed the economics of any particular buying situation.
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Re: 2012: Demand Exceeds Supply

Unread postby shortonsense » Sun 02 May 2010, 19:51:33

$this->bbcode_second_pass_quote('AirlinePilot', '')$this->bbcode_second_pass_quote('shortonsense', 'A')re you claiming that we didn't have fiat money from 1979 to 1985....when production was suffering some of those "real declines" you go on about, yet the economy grew as well?



As Ive said before back then it was evident, supportable, and reliable that oil production would grow and grow significantly.


NOT true, otherwise Jimmy Carter wouldn't have been using the words "running out". It is only obvious in HINDSIGHT how badly that call went....it certainly was called an "energy crisis" at the time for a reason. For many of the same reasons you want to apply to today, as a matter of fact. "We aren't finding enough" and "We need 1 new Saudi Arabia every 3 years" being my favorite recycled nonsense.

$this->bbcode_second_pass_quote('AirlinePilot', '
') Fiat money, without some form of support to allow it to continue..which means growth...will fail. All Fiat money systems since time began at some point have failed. Why is it so hard to believe that ours can now? I'm not one to turn away from the lessons of history short, I dont believe you are either.


I never said that fiat money systems won't fail or have their weaknesses, I said they don't have near as much to do with peak oil as you imply, and certainly aren't tied to growth in oil supplies in a causal fashion.

$this->bbcode_second_pass_quote('AirlinePilot', '
') Without a direct replacement for cheap oil (which it is NOT now) this situation will correct itself.


We've been replacing cheap oil with more expensive oil since 1970. I certainly don't see that changing anytime soon either, no matter what the absolute volume of supply is.
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