[Plantagenet]

$this->bbcode_second_pass_quote('Strummer', 'o')il companies are abandoning new exploration and development projects, thereby lowering their CAPEX, so the "cost floor" sinks lower. Is that supposed to be good news?

[Tanada]

Have no fear, Brent is back up to $95.65 as I type this.

http://www.bloomberg.com/energy/

[Pops]

$this->bbcode_second_pass_quote('Herr Meier', 'Y')ou could have full-employment economy where most productive output of the economy is geared towards finding, pumping and processing oil. High oil price has nothing to do with economic contraction, assuming the change in price is slow enough to be able to gear the industrial output towards oil production.

[AndyA]

Is this caused by a reduction in consumption or an increase in production? I'm not exactly sure what is going on, but there seem to be a few commodities that have been sliding in price this year. I'm thinking it has more then a little to do with the deflationary pressures of high debt, low growth in new debt and a genuine lack of money good collateral. Companies have stopped investing via capex and are investing in share buybacks, which is one way of saving energy. If Ebola continues to spread then the price of everything non medical can be expected to fall.

$this->bbcode_second_pass_quote('AndyA', 'I')s this caused by a reduction in consumption or an increase in production?

[KaiserJeep]

Yay for cheap oil! Lets go fill our tanks and go cruising, because we can.

[Pops]

$this->bbcode_second_pass_quote('AndyA', 'I')s this caused by a reduction in consumption or an increase in production? I'm not exactly sure what is going on, but there seem to be a few commodities that have been sliding in price this year. I'm thinking it has more then a little to do with the deflationary pressures of high debt, low growth in new debt and a genuine lack of money good collateral.

[KaiserJeep]

Pops, the only correction I would make is that the Chinese don't even care for beef that much. They are switching to a rice ball economy, not a burger-flipper economy. But unfortunately their trade imbalance is gonna put a few million private automobiles on their roads before the oil conniption ends, and create a huge demand for oil the world does not have.

Then after the light hydrocarbons are all burned as fuel, they will use the petroleum feedstocks that remain to manufacture plastic crap that they will export to us, in return for even more rice. Freight containers loaded with plastic crap go to the US, and come back loaded with sacks of rice. At the end of the cycle, we have beaucoups plastics in our landfills, and they have beaucoups honey in their honey buckets. At which point they have low-energy organic recycling to do to produce more food, and we will probably be burying plastic wastes as rising energy costs make recycling more expensive.

Seems like they have all the angles figured, sometimes.

[kublikhan]

$this->bbcode_second_pass_quote('KaiserJeep', 'P')ops, the only correction I would make is that the Chinese don't even care for beef that much. They are switching to a rice ball economy, not a burger-flipper economy.

[furrybill]

$this->bbcode_second_pass_quote('kublikhan', '')$this->bbcode_second_pass_quote('KaiserJeep', 'P')ops, the only correction I would make is that the Chinese don't even care for beef that much. They are switching to a rice ball economy, not a burger-flipper economy.

[GregT]

$this->bbcode_second_pass_quote('', 'W')ell.. so what's this mean for the peak oil picture?

[Herr Meier]

$this->bbcode_second_pass_quote('Pops', '')$this->bbcode_second_pass_quote('Herr Meier', 'Y')ou could have full-employment economy where most productive output of the economy is geared towards finding, pumping and processing oil. High oil price has nothing to do with economic contraction, assuming the change in price is slow enough to be able to gear the industrial output towards oil production.

[Herr Meier]

$this->bbcode_second_pass_quote('pstarr', '')$this->bbcode_second_pass_quote('Herr Meier', 'I') could even argue that in case of EROEI 1.1 the economy is much larger, providing jobs etc, although at no net benefit to the standard of living.

[Herr Meier]

P, not to penny-pinch, but EROEI approaches 1, not 0.

Assume you need 1 cord of wood for your own use every year. Fortunately your wood lot is basically infinitely large. Unfortunately it is also in extreme terrain, requiring you to buy, use and maintain very expensive and technologically advanced machinery to be able to access the wood. In order to pay for this you will need to cut and sell 9 cords of your wood, only to get your single cord for your own use. As you can see, even with a EROEI of 1.1, you still get your wood and don't need to freeze in winter. Same with oil. Expensive oil does not reduce economic activity (as long as the increase is cost is slow enough).

[Pops]

$this->bbcode_second_pass_quote('Herr Meier', 'A')s you can see, even with a EROEI of 1.1, you still get your wood and don't need to freeze in winter.

[ROCKMAN]

Just a touch of reality regarding EROEI: wells get drilled based on anticipated profit margin. I've explained many times that IMHO somewhere in the 5 to 6 EROEI range drilling for oil/NG becomes uneconomic. EROEI has never been the determining factor of what gets drilled... and never will. It's the ROR. Very simple: Follow the money... not the BTU's. LOL.