[ROCKMAN]

pstarr - Which is why some time ago I suggested less emphasis on peak oil for a number of reasons. But primarily the worlds economies don't function with oil to any real degree. Except, of course, for the major oil exporting economies. The global consumers don't utilize oil: they utilize gasoline, diesel, heating oil, jet fuel, lubricants, etc.

The typical US driver doesn't give a sh*t how much oil the country produces or imports. Most of those drivers care only about PG and the price they pay per gallon. They don't care if their motors fuel is made from WTI or recycled oil from McDonald's deep fat fryers.

By focusing on the production of refinery products we avoid the never ending debate of the definition of "oil". We occasionally touch on what US gasoline consumption looks like. But has anyone seen a curve for global gasoline production? Jet fuel production? And the most interesting and relevant stat: total globally refinery out put?

In the end the details of energy consumption with be more important then the amount of "oil" is produced.

[ROCKMAN]

For instance how many would be surprised to learn that US "net refinery output" has steadily decline since 2005 (the earliest date shown by the EIA)?

http://www.eia.gov/dnav/pet/hist/LeafHa ... _nus_1&f=a

Or that the "net production of finished motor gasoline" from US refineries has declined 75% since 2005?

http://www.eia.gov/dnav/pet/hist/LeafHa ... _nus_1&f=m

Globally from Reuters last June:

"Oil demand is set to surge in the short-term as refining capacity hits a record, yet the gains may not hold as a flood of fuel gluts the market, eroding profit margins and eventually forcing refiners to cut runs and crude orders.

Data on Thomson Reuters Eikon shows that available global capacity to refine oil into fuels like gasoline, diesel, or jet and shipping fuel, will reach 101.8 million barrels per day (bpd) in August, the highest on record, and up from about 97.25 million bpd in March."

[Subjectivist]

I won't deny it, though I am a PO news junky what I care most about is what I have to pay when I go to the fueling station.

[ROCKMAN]

Sub - Which only means you're no different then the other 99%+ of the buttholes on the planet. It's just us 1%- buttholes that produce oil for a living that care about the volume. LOL.

But seriously I've tried to turn the conversation from PO to PRP (Peak Refinery Products) unsuccessfully in the past. And now that we have debates over floating definitions of "oil", reserves vs resources, increasing/decreasing EROEI, etc. it seems all the more appropriate today. Consider all the speculation over the future price of oil. Oil will be priced based upon how much refinery products consumers buy at what price...just as it has always been. Despite what some believe the dynamic doesn't work the other way around. Correctly predict how much refined fossil fuel the world consumes and whaf it will pay in 10 years and you'll have a good idea of the price of oil at that time.

And how f*cking difficult would that be? LOL. Think back just 3 years or so: what data do you recall that would have led you to predicting the global economy would consume as much refinery products as we are today at the current price? Now jump into your Way-back Machine to 2005 and tell me what data you obviously misinterpreted since you didn't predict the volume and very high price refinery products in 2011. Or did you predict US consumers would be willing to pay $3.96/gal for 1.3 BILLION gallons of gasoline in May 2011? Had you done so predicting oil selling for $100/bbl that same month would have been easy, right?

So tell us: how much money did you make on those long term oil future contracts. LOL.

Consider what I just offered: how important is predicting the date of global PO, new reserves discovered this year, depletion rate of old fields, rig count in the Eagle Ford in January 2018, how many EV's will be sold betweenn now and 2028, etc. compared to how much refinery products the global economy can afford to buy every year for the next 20+ years? IOW if US drivers can't afford to buy much gasoline priced at $2+/gal in 2020 what will oil sell for then? And if they can afford $4/gal in 2020 and refinery out put is low for whatever reason and it takes that price to get it to them what will oil be selling for?

See: predicting future oil prices is easy-peazy. LOL.

[sparky]

.
@ Rockman , good call on refineries output volume ,
my personal Peak Oil indicator is commercial jet fuel volume ,
that imply an advanced level of spending and there is no substitute for it if one want a commercial aviation ,

[Tanada]

Thinking back I can remember several analysts and/or radio/TV spokespersons saying with some regularity that the USA economy would collapse if gasoline had achieved a sustained price of $4.20/gallon for more than a few days. I never understood what the magic of $4.20 was as opposed to say $4.10 or $4.30 but the number was said stridently often enough that I still remember it 5+ years later.

Lets be honest for a moment, the USA sustained prices north of $60/bbl for crude oil from late 2009 right up until the middle of 2015. For most of that period, mid 2010 through late 2014 crude oil was selling for more than $80/bbl. The USA economy wasn't growing by leaps and bounds and the FED was dumping QE cash infusions into the big finance people every few months, but there was no permanent collapse/crash and oil demand on the world stage grew every stinking year.

All these folks who post endlessly about demand destruction or how the world economy can not handle $60/bbl oil prices can only reach those conclusion by totally ignoring the recent past. Not only CAN the world survive and increase demand at $60/bbl, $70/bbl, $80/bbl IT ALREADY HAS DONE SO!!!!

Now that I have that out of my system world peak oil is dependent on two things, when the 'world consumer' is both able and willing to pay X how many barrels can the oil producers deliver at price X? If that number is 99 MM/bbl/d then that will be ultimate peak, if that number is 111 MM/bbl/d then that will be ultimate peak. Geological limits are not the only factor because give me enough money and I can build a natural gas to oil plant, or a coal to oil plant, or a biomass to oil plant and eke out a few hundred thousand more barrels of very expensive synthetic oil to meet your demand.

On the other hand if the world economy slows significantly every time oil hits say $96/bbl then all the oil that companies can make a profit from producing at $96/bbl will be produced and demand destruction will cap world peak production at whatever level that price can sustain.

This is the fundamental price=demand/supply equation that has ruled oil supply since Drake poked his first hole in Pennsylvanian. Price changes BOTH demand and supply, so ignoring it won't give you a valid answer. I can give you say 1 BILLION bbl/d if you get the price high enough, but to do so what I would really be doing is converting something else into the oil you were willing to pay for. IOW almost all of that oil would be synthetic oil. But as has been pointed out, if you are the guy buying gasoline or diesel fuel what difference does it make to you if the fuel is synthetic or refined from a natural goo retrieved from underground? Heck if I were the retail fuel outlet I wouldn't care either, I just care if you deliver what I need in a way that satisfies my customers. The only people who would care would be ROCKMAN and his fellow oil workers who would be swamped out of business by the synthetic fuel producers.

[ROCKMAN]

T/pstarr - A nice civil discussion...well done. Since my company never borrowed a penny of the $260 million we spent developing oil/NG I tend to forget that crutch the oil patch had from QE and debt.

T - And back to that aspect that makes unravelling cause and effects of an already complex dynamic more difficult: time lag. Which itserlf isn't static but a differential of ever varying factors. IOW how the global economy reacted to $119/bbl (2015) oil in the late 70's doesn't necessarily represent a template for the reaction when it hit $120+/bbl in 2008.

[AdamB]

$this->bbcode_second_pass_quote('Graeme', '[')b]Peak oil is approaching[;quote]

AGAIN?

$this->bbcode_second_pass_quote('', '�')��By 2030, the growth in fossil fuel use will almost have stopped,” Bloomberg New Energy Finance founder Michael Liebreich told renewable-energy investors at the BNEF 2013 annual summit in New York last month.

[ROCKMAN]

Perhaps there is a NATIONAL practical approach to deal with that approaching beast. In case some missed it in the News section I wanted them to be aware of a book our cohort Energy Investor just made the Rockman aware of: "The Grid - The Fraying Wires Between Americans and Our Energy Future".

Perhaps someone should send President-elect Trump a copy. Perhaps a much better infrastructure investment then much the many the tens of $BILLIONS spent on "shovel ready" projects in recent years. Maybe the new POTUS could appoint a czar of a new national EXCOT group. LOL. From a review:

"America's electrical grid, an engineering triumph of the twentieth century, is turning out to be a poor fit for the present. It's not just that the grid has grown old and is now in dire need of basic repair. Today, as we invest great hope in new energy sources--solar, wind, and other alternatives--the grid is what stands most firmly in the way of a brighter energy future. If we hope to realize this future, we need to re-imagine the grid according to twenty-first-century values. It's a project which forces visionaries to work with bureaucrats, legislators with storm-flattened communities, moneymen with hippies, and the left with the right. And though it might not yet be obvious, this revolution is already well under way."

See more at: http://www.bloomsbury.com/us/the-grid-9 ... Ypttu.dpuf

EI's post also allows the Rockman to point out for the umtenth time that the big alt energy build out in Texas would not have happened without $7 BILLION in tax payer monies being spent to improve the Texas grid. The Texas grid that is not part of the two national electric grids the book discusses.

[AdamB]

$this->bbcode_second_pass_quote('ROCKMAN', '
')EI's post also allows the Rockman to point out for the umtenth time that the big alt energy build out in Texas would not have happened without $7 BILLION in tax payer monies being spent to improve the Texas grid. The Texas grid that is not part of the two national electric grids the book discusses.

[ROCKMAN]

"Jimmy Carter said it would happen by the end of the 1980's." And in 1975 Tim Bullard, the Rockman's first mentor at Mobil Oil, explained how the dynamics of global PO were already impacting the US to a small degree but over time it would become much more serious. His best guess: some time after the turn of the century.

Looks like Tim was a good guesser for a geologist. But he had been working in the oil patch ever since the end of WWII when he was a double ace P-51 pilot. One heck of a guy in many aspects.

[AdamB]

$this->bbcode_second_pass_quote('ROCKMAN', '&')quot;Jimmy Carter said it would happen by the end of the 1980's." And in 1975 Tim Bullard, the Rockman's first mentor at Mobil Oil, explained how the dynamics of global PO were already impacting the US to a small degree but over time it would become much more serious. His best guess: some time after the turn of the century.

[ROCKMAN]

"Some texans will always drive pick me up trucks, but others will get with the program and enjoy the benefits of transport powered by the renewable generation that Texans have already INVESTED in. Good for them."

In reality with regards to our big alt build out neither our citizens nor the politicians give a crap about EV's. It was all about our booming home and business electricity demand. As proven by the fact that only 0.2% of vehicles sold in Texas were EV's. Despite:

"In the summer of 2014 Texas began offering a $2,500 rebate on electric cars, plug-in hybrids and natural gas-powered vehicles. That money is on top of federal tax credits that can reach $7,500. For the Nissan Leaf and Chevrolet Volt, the two most popular cars in the state program, $10,000 in incentives can knock off almost a third of the retail price. That’s tempting, even with gasoline selling for about $2.50 a gallon."

Needless to say even with 10% of our electricity coming from wind (and now with solar beginning to take off) Texas isn't not part of the mythical "transition" away from ICE's. Especially now that gasoline has fallen from $2.50 per gallon to under $2. LOL.

[ROCKMAN]

"The USGS was predicting US peak oil in 1919," Read my post again. Tim didn't predict the impact of the peak oil dynamic in the future: he pointed out clues that it had already begun. Just as all the old timers in the oil patch had recognized then. But obviously the companies had no incentive to have that info presented to the public.

Tim's lessons helped the Rockman appreciate the cycles of the peak oil dynamic for the last 40 years. This was the main reason the Rockman chose to focus on development and engineering early on instead of exploration. And a big reason he prospered during the mid 80's bust when exploration got tossed under the bus. Just as it was a couple of years ago with the Rockman now still gainfully employed: exploration wells disappear while development wells requiring maintenance keep pumping. LOL.

Understanding the POD wasn't some new hobby for the Rockman: he saw the personal joys and pains of the peak oil dynamic first hand for the last 4 decades. As well as the last few years. Same reason the Rockman decided to disconnect himself from employment with public companies almost 10 years ago. He understood that decades old shell game was nearing its end.

IOW understanding the POD has not been some idle Internet pastime for the Rockman as for some here: it's how he's taken care of his family and will continue to do so.

[AdamB]

$this->bbcode_second_pass_quote('ROCKMAN', '&')quot;Some texans will always drive pick me up trucks, but others will get with the program and enjoy the benefits of transport powered by the renewable generation that Texans have already INVESTED in. Good for them."

In reality with regards to our big alt build out neither our citizens nor the politicians give a crap about EV's.