Global Oil Production Substantially Lower Than Believed

69 Comments on "Global Oil Production Substantially Lower Than Believed"

shortonoil on Wed, 17th Jun 2015 7:57 pm 



Hi Kurt,

Did you finally get around to reading our web site. Its been up for almost two years. But yes, what you say, or we said, is exactly right. Anything with an API greater than 45 is feedstock. You can’t run an economy on feedstock. It doesn’t deliver enough energy to make it worth taking out of the ground unless there is an economy powered by crude to buy it. The shale industry has been pulling the wool over the investors eyes for a long time by using a little quirk in the EIA’s definition of oil. The EIA has been part, and party to it by not stating explicitly that what they were reporting was “liquid hydrocarbons”. But, thanks for reiterating what we have been trying to inform people of for quit a while.

Energy independence…. not a chance!

http://www.thehillsgroup.org/

Apneaman on Wed, 17th Jun 2015 8:08 pm 



Kurt Cobb explains how they muddy the waters and move the goal posts.

“But first, an important question. Why do government and industry officials, oil analysts, and energy reporters equate total liquids and total oil supply? They claim that these other liquids are essentially interchangeable with oil. (I will discuss some of the not-so-savory motives behind this claim later.) In a recent report the U.S. Energy Information Administration put it this way: “The term ‘liquid fuels’ encompasses petroleum and petroleum products and close substitutes, including crude oil, lease condensate, natural gas plant liquids, biofuels, coal-to-liquids, gas-to-liquids, and refinery processing gains.” Let’s see why the “close substitutes” assumption is demonstrably false when it comes to most natural gas plant liquids and decidedly disingenuous when it comes to biofuels.”

http://resourceinsights.blogspot.ca/2012/07/how-changing-definition-of-oil-has.html

Plantagenet on Wed, 17th Jun 2015 9:00 pm 



The obama administration changed the legal definition of “oil” to include condensates, palm oil, biofuels, ethanol, etc. etc. so data from US government sources have this bias build in now. The reason why is obvious—-its to make the supply of oil look bigger.

rockman on Wed, 17th Jun 2015 9:04 pm 



A valid point, of course. But I need to point out a few unarguable facts. First, the consumers don’t buy oil, condensate or gas plant liquids. So while the amount of “crude oil” produced might be less it doesn’t mean the primary products refined from crude oil and all other liquid hydrocarbons has declined. Consider the consumption history from the EIA of the three primary liquid petroleum products made from crude oil, condensate, et al from 2000 to 2013…thousands of bbls per day:

Gasoline: 19.9 to 22.6

Diesel: 20.4 to 26.4

Jet fuel: 4.6 to 5.4

It’s also important to remember that US refineries don’t make these products from 20 API oil, 50 API condensate or even lighter NG plant liquids. They refine blends. Blends that have varied very little for decades: 29 API to 32 API. The heavy oils have to be mixed with lighter condensates. One of the big benefits of the increased Eagle Ford condensate production is the decrease in those imports.

So yes: various folks have played semantic games with “oil” for various reasons. But that doesn’t change the fact that the composition of the refinery products made from all liquid hydrocarbons hasn’t changed in the last 13 years despite the increase in “non-crude oil” production. And those volumes consumed have also increased.

Makati1 on Thu, 18th Jun 2015 12:39 am 



rockman, does that mean that gasoline made with 10% ethanol(biofuels) blend has the same energy per gallon/mpg as pure petroleum gasoline? I know that ethanol and ‘condensate’ are two different animals.

Just asking for clarification in my mind. Thanks.

Nony on Thu, 18th Jun 2015 1:33 am 



The liquids whining is getting really old. Yes, I agree propane is not oil, it is a heavy gas. But somehow ace/Campbell/staniford were fine to look at all liquids c. 2007. Just now that things are not working out so good for the peakers, they decide some evil MSM conspiracy is playing games. No…it’s the same confusion that was there before. It’s just now things look worse for peakers on total liquids than on oil (doesn’t look good for them there either).

Brown has also had a lot of really misguided remarks about 40+ API oil and condensates.

yoananda on Thu, 18th Jun 2015 2:37 am 



oil barrel counting is a trick.
What really matters is gasoline and diesel.

I had hard times finding some reliable sources of world (and countries) gasoline/diesel production.

Does somebody know’s where to find that ?

Perk Earl on Thu, 18th Jun 2015 2:53 am 



Short wrote:

“Anything with an API greater than 45 is feedstock. You can’t run an economy on feedstock.”

Rockman then Wrote:

“The heavy oils have to be mixed with lighter condensates. One of the big benefits of the increased Eagle Ford condensate production is the decrease in those imports.”

“So yes: various folks have played semantic games with “oil” for various reasons. But that doesn’t change the fact that the composition of the refinery products made from all liquid hydrocarbons hasn’t changed in the last 13 years despite the increase in “non-crude oil” production. And those volumes consumed have also increased.”

Did you catch that, Short? It’s all getting used and even reducing imports. So what do you say to that?

Ralph on Thu, 18th Jun 2015 3:54 am 



WestTexas has a lot to say on this over at peakoilbarrel. The truth is somewhere between Short and Rockman.

US oil production is getting higher average API over the years, and the abundance of shale has been building up in storage because the refineries can’t use it all, whilst imports of heavy oil held up. Also – there are limits to blending. Mixing 48 API with 12 API might give you a nominal 30 API, but refineries want middle sized molecules, not a mixture of very short and very long molecules.

When oil got expensive the price of diesel went up more than the price of petrol – because we are running out of middle fraction oil faster than heavy or light oil.

Finally of course, we want energy, and measuring production in barrels does not reflect the lower energy in biofuels etc.

Davy on Thu, 18th Jun 2015 7:08 am 



Folks can you spot the slimy cheerleader promoting a snake oil salesman agenda of all is well and the well balanced and direct comment?

Number one:
“The liquids whining is getting really old. Yes, I agree propane is not oil, it is a heavy gas.”

Number two:
Read Ralphs whole comment.

Aire on Thu, 18th Jun 2015 7:27 am 



Essentially Short-on is correct in saying it’s feedstock because you absolutely need the real McCoy to make it viable. Otherwise you cannot run a complex society.

I see it as a way of thinning out what we were use to and it (refinery products) being basically as good still.

The article points out that yes this can make things misleading and yes we’re in trouble since the sweet stuff is going down the hill.

shortonoil on Thu, 18th Jun 2015 8:14 am 



“Did you catch that, Short? It’s all getting used and even reducing imports. So what do you say to that?”

You can take pentane (essentially plant condensate) and make gasoline out of it. That is accomplished with a splitter (a type of mini refinery). The total net energy available from it is just about zero. The total net $ value to the economy is also just about zero. If you attempted to run the economy on plant condensate everything requiring petroleum to power it would stop. In essence, you can’t put food on the table using pentane.

You are confusing volume, and energy. They are both properties of matter, but they are certainly not equivalent. Oil companies sell oil by its volume metric; barrels. The economy uses oil by its energy metric. One barrel of oil with an energy content of 1 million BTU results in the same amount of economic activity taking place as 10 barrels with 100,000 BTU. Splitting, blending, and cracking does not produce more economy, it just produces more barrels. When the net energy within the society from petroleum reaches zero, everything requiring petroleum to power it will stop. The billions of barrels left in the ground will remain in the ground; there will be no economy remaining to use it. The difference between volume, and energy will then become very apparent!

This all goes back to what Issac Newton said 300 years ago. Force = mass times acceleration. Energy = force times distance. If mass is not moving, the economy has stopped, and without energy it is not moving.

http://www.thehillsgroup.org/

rockman on Thu, 18th Jun 2015 8:25 am 



“…feedstock because you absolutely need the real McCoy to make it viable.” Just as you need the lighter liquid hydrocarbons, the other feedstock, required to make crude oil a viable source of refinery products. IOW our “complex society” is as dependent upon the light liquid hydrocarbons as “crude oil”. How important are the light liquids to the refining process? Have we forgotten that Canadian refineries are paying to ship millions of bbls of Eagle Ford condensate half way around the country so they can make motor fuels?

And Ralph: and what, pray tell, did my post point out that wasn’t the “truth”? Inquiring minds would like to know. LOL

Mak: think about it – how do vehicles run today using 2015 diesel/gasoline vs how the same engine designs ran in 2000?

Bottom line: 99.9% of folks on the planet don’t care if their products are made from crude oil, condensate or owl sh*t. LOL. IOW the critical issue isn’t so much PO but PRP…Peak Refined Product. And the price of those products.

There’s nothing wrong with highlighting the word games being played with the categorization of produced liquid hydrocarbons. In fact, over 40 years ago in New Zealand Mobil Oil made motor fuel out of NG. Motor fuel identical to that made from crude oil blends. It just costs more the it’s worth. Companies today are still trying to find a way to take the much cheaper NG Btu’s and make motor fuels.

And one more side note: remember that those hundreds of millions of Canadian oil sands production couldn’t make it to US refineries to be cracked if they weren’t first blended with condensate in order to transport it. In fact about 25% of “oil sands oil” is actually condensate…much of it imported from the US. How critical is that condensate to the process: there is a plan to build a pipeline from S La to Alberta to haul light “oil”.

justeunperdant on Thu, 18th Jun 2015 8:34 am 



Short is right that it is about a energy balance. It is not about money or volume.

Once you understand that, you understand that eventually there will not be enough energy to keep the supply chain alive (food production, diesel production, clothes production).

https://youtu.be/lbPEaaKiCww

http://www.learnengineering.org/2013/03/frist-law-of-thermodynamics-open-system.html

shortonoil on Thu, 18th Jun 2015 8:36 am 



“Did you catch that, Short? It’s all getting used and even reducing imports. So what do you say to that?

Did you ever consider that maybe imports are slowing because the world economy is slowing? Cause, and effect can be tricky! If you are turned around in the cart, the cart before the horse sort of makes sense.

shortonoil on Thu, 18th Jun 2015 9:17 am 



“Bottom line: 99.9% of folks on the planet don’t care if their products are made from crude oil, condensate or owl sh*t.”

99.9% of folks don’t care if it is a stinky petroleum product, or magic pixie dust as long as it makes their car, boat, or plane go. It is all about energy, and when the energy is gone so also will go the petroleum industry. The number of barrels they will be able to pump, split, crack and frac will be none. When the energy will be gone is what we have been calculating. It is not as far into the future as most would like to believe. We will then have to try running our world on NG, coal, fission, fusion, solar, wind, and magic pixie dust. Looks like things are about to change!

The start of things to come is shown below:

http://www.reuters.com/article/2015/06/18/us-usa-oil-slowdown-insight-idUSKBN0OY0E820150618

And this will go on, and on:

http://www.thehillsgroup.org/depletion2_022.htm

And its all about when the energy will be gone?

http://www.thehillsgroup.org/

Nony on Thu, 18th Jun 2015 9:42 am 



Light crude oil sells at a premium to heavy crude oil. You can get more middle distillate products (the money products of gasoline/jet/diesel) by simple distillation of light sweet than of heavy sour. Yes, the heavy sour has more total energy content, but a lot of the first cut is gasoil or even heavier resids and has to go to secondary processes like cracking, reforming, visbreaking, coking, etc. to get useful molecules. The other thing is that too heavy of a crude (whether you buy it that way or just from having the light ends evaporate, for instance crude that is exposed to air for long times) is hard to handle because it becomes so thick and hard to flow.

Remember back in the peaker peak, that the concern was not enough WTI!

http://econbrowser.com/archives/2005/08/sweet_and_sour (James Hamilton, 2005)

“Fascinating fact that light sweet grades seem to have peaked already.” -Stuart Staniford! in comments.

Nony on Thu, 18th Jun 2015 9:48 am 



The other thing that peakers always fail to note is how sweet (low sulfur) shale oil is. Light oils are sweet. Heavy oils are sour (high sulfur). And sour is bad, sweet is good!

Sulfur is a waste product at a refinery. (you sell it, but it costs you more to remove it than you get paid for it). People don’t like sulfur in their diesel or gasoline now. Getting the sulfur out requires extra steps in the processing (read capital equipment cost) and use of hydrogen (cost).

Nony on Thu, 18th Jun 2015 9:54 am 



These old pre-shale comments are revealing:

“Don’t blame the governement’s regulamentations. The data show that the Hubbert’s peak for light crude is on us. That is the main factor that is causing the light crude oil prices going to sky. There are no free market that can spare the world from use all oil. Because with governamental’s regulamentations or no governamental’s regulamentations, the heavy crude have a higher coust to produce gas and it flow slower. It is more expensive to produce the heavy crude and it is more expensive to use it to make gas, so the market will ever prefer buy the light crude. And the market ever prefered to buy the light crude BEFORE the governamental’s regulamentations. So, not blame the governamental’s regulamentations, it is not the main factor.
The main factor causing the oil prices going to sky is called HUBBERT’s PEAK. It is something that the free market cannot foresee and cannot find an answer. But only the governement can create a public project for find a substitute for oil…
But evidently is too late.
Joo Carlos
Sorry the bad english, my native language is portuguese.”

1. Before the peakers say light crude is better. Now they change their story!

2. The government needs to do something…free market can’t find more light oil. BS!!!! The shale revolution happened while the government was investing in Solyndra!

Perk Earl on Thu, 18th Jun 2015 10:12 am 



Short wrote:

“You are confusing volume, and energy. They are both properties of matter, but they are certainly not equivalent.”

Rockman wrote:

“And one more side note: remember that those hundreds of millions of Canadian oil sands production couldn’t make it to US refineries to be cracked if they weren’t first blended with condensate in order to transport it. In fact about 25% of “oil sands oil” is actually condensate…much of it imported from the US. How critical is that condensate to the process: there is a plan to build a pipeline from S La to Alberta to haul light “oil”.”

Short wrote:

“Did you ever consider that maybe imports are slowing because the world economy is slowing? Cause, and effect can be tricky! If you are turned around in the cart, the cart before the horse sort of makes sense.”

Wrong! – more oil than ever is being used in the US and the world economy. Remember Short to hook up the horse in front of the cart.

Rockman wrote:

“And one more side note: remember that those hundreds of millions of Canadian oil sands production couldn’t make it to US refineries to be cracked if they weren’t first blended with condensate in order to transport it. In fact about 25% of “oil sands oil” is actually condensate…much of it imported from the US. How critical is that condensate to the process: there is a plan to build a pipeline from S La to Alberta to haul light “oil”.”

Short, you’re responding to me but really it’s Rockman that is taking you to task on these questions, so why don’t you have the guts to respond to him directly?

westexas on Thu, 18th Jun 2015 10:18 am 



Note that Cat Feed + Distillate Yield drops from about 50% at an API gravity of 39 to about 19% at an API gravity of 42:

http://i1095.photobucket.com/albums/i475/westexas/Refineryyields_zps4ad928eb.png

And the global refinery system is currently designed to handle the grades of crude oil on the following chart (note the upper API limit):

http://i1095.photobucket.com/albums/i475/westexas/APGravityVsSulfurContentforCrudeOils_zpsc28e149c.gif

And of course, when we ask for the price of oil, we get the price of 40 API or lower gravity crude oil (most commonly WTI and Brent on the above chart).

The EIA is now estimating that there was almost no increase in quality US crude oil production (40 API and lower crude oil) from 2011 to 2014:

http://i1095.photobucket.com/albums/i475/westexas/US%20CC%20Production%20by%20API%20Gravity_zps0aa4elnz.gif

However, the refinery yields of crude oil versus condensate is something of a red herring. As prices rise, I don’t think anyone was arguing that partial substitution would not be a factor, but the Cornucopians are arguing that there is no sign of any kind of peak in sight.

I would argue that the only reasonable inference that one can draw from the following data is that global crude oil production (45 and lower API gravity crude oil) probably peaked in 2005, while global natural gas production and associated liquids–condensate and natural gas liquids (NGL)–have so far continued to increase–as annual Brent crude oil prices increased from $55 in 2005 to an average of $110 for 2011 to 2013 inclusive (and to about $99 in 2014).

BP shows that global gas production increased by 24% from 2005 to 2014.

The EIA shows that global Natural Gas Liquids (NGL) production increased by 27% from 2005 to 2014.

The EIA shows that global Crude + Condensate (C+C) production increased by only 5% from 2005 to 2014.

Condensates and NGL are byproducts of natural gas production.

Why did we see a very slow rate of increase in global C+C production versus the much more rapid rate of increase in global NGL and gas production?

Perk Earl on Thu, 18th Jun 2015 10:20 am 



Short, there’s been a post on the right side of this website for about a week at the link below that is directly asking you a question, yet you continue to ignore it, why?

http://peakoil.com/forums/viewtopic.php?f=1&t=71458

Perk Earl on Thu, 18th Jun 2015 10:25 am 



Also, while Rockman (an actual expert in the field) is on this particular board, can you opine for us on the graph on Short’s website that claims the value of a barrel of oil to the economy in 2020 will be $18. Does that seem to you to be an accurate prediction?

Davy on Thu, 18th Jun 2015 10:27 am 



Well said JUST and my thoughts also, “Short is right that it is about a energy balance. It is not about money or volume. Once you understand that, you understand that eventually there will not be enough energy to keep the supply chain alive (food production, diesel production, clothes production)”.

Just is making the connection I constantly try to get across to all the oil talk here and that is the dynamics of oil in the economy. The system requires more energy and more growth. Less energy and less growth is not good enough and cannot last.

I will get even more focuses saying just a little bit less growth increase is not good enough. The slightest miss to a needed required growth on average of 3% globally is deadly for the system. This is the key to the equation. You can argue all day long about the molecular nature of oil, the price of oil, and the oil markets but the reality is the decreasing availability of the best oil along with many other economic dynamics that are putting a negative inertia on the vital momentum of global growth.

I would say oil is the most important variable to our systems survival but its effects may not be the most pronounced just yet. I would say oil’s economic value to the global system is the wall that is the end of the line for our global train. I think now we are more at threat from the financial side of the economic system deteriorating. Oil is playing a part in the financial decay at an ever increasing pace but oil is not yet the killer it will be in a few years hence.

We have a deteriorating geopolitical and economic situation in a global system that must cooperate to ensure complex systems and networks remain functioning. The fact is we are just too dependent on each other for conflict to work. We are too dependent on increasing energy needs. It is the multiple failures that are going to bring our plane down not the one.

Nony on Thu, 18th Jun 2015 10:30 am 



Have you ever worked in a refinery, Jeff?

39 and 42 are not dramatically different (your little red and yellow picture). And for that matter, the exact distillation curve of a 39 (or) 42 may vary depending on the source. Remember API is nothing magic…it is just the specific gravity (density) run through a formula. Knowing the density of an oil does not tell you everything about it. To know the distillation curve, you have to distill it.

http://www.astm.org/Standards/D2887.htm

Cat feed is something going to another, very significant and expensive process. So not stuff you just distill off and blend and use.

What the HECK is that distillation fraction called “gasoline” and giving you 80% for the 42 API? That makes no sense at all. Is that supposed to be naptha?

Where the eff did you get those little picture from?

Nony on Thu, 18th Jun 2015 10:43 am 



http://inside.mines.edu/~jjechura/Refining/02_Feedstocks_&_Products.pdf

See pages 23 and 24 for comparison of Bakken shale oil to classic WTI. It’s almost the same thing. For that matter having less asphaltenes at the bottom of the barrel (vacuum dist resid) is a feature, not a bug! Oh…and less V, less Ni, less concarbon. What’s not to like?

westexas on Thu, 18th Jun 2015 12:37 pm 



50% cat feed + distillate yield (at 39 API) versus about 19% (at 42 API) is not a dramatic difference?

In any case, as I said, the quality issue is something of a red herring, which tends to obscure the bigger picture, to-wit, it’s very likely that actual global crude oil production (45 and lower API gravity crude) peaked in 2005, while global gas production and associated liquids, condensate and NGL, have so far continued to increase.

Nony on Thu, 18th Jun 2015 1:03 pm 



1. To not distinguish between 47 API Eagle Ford crude (which you can buy cargoes of that come in tankers to you…well in Canada/US) and propane is insane. One is clearly a crude oil liquid soup of hydrocarbons that gets processed through a refinery. The other is a molecularly pure substance that is a gas at room temperature!

2. What is the source of your little red/yellow charts. I’m not impressed.

3. The feed to a catalytic cracker is heavy gas oil, dude. A cat cracker is an expensive piece of machinery for trying to get useful molecules out of NOT useful molecules by transforming them. It is a downstream process! Read the comments in the 2005 post that I linked to. Even your fellow peakers were discussing how it cost extra money and was more work to refine heavy oils.

https://en.wikipedia.org/wiki/Fluid_catalytic_cracking

4. Heavy oil STILL costs less than light oil. Even in the US, with a boom in light oil and export restrictions trapping it.

5. And you TOTALLY avoid the issue of sulfur and the added costs of processing sour crudes vice sweet ones, and that API and S are negatively correlated.

westexas on Thu, 18th Jun 2015 1:25 pm 



Normalized global C+C, Gas and NGL data (2002 to 2012, EIA data, with 2005 = 100%):

http://i1095.photobucket.com/albums/i475/westexas/Slide1_zps45f11d98.jpg

Based on EIA + BP data, C+C in 2014 was at 105%, gas was at 124% and NGL was at 127% (of 2005 values).

I wonder what changed in the 2005 to 2014 time period versus the 2002 to 2005 time period, in regard to the composition of global C+C values?

ML on Thu, 18th Jun 2015 1:41 pm 



Perk Earl wrote:
“Wrong! – more oil than ever is being used in the US and the world economy. Remember Short to hook up the horse in front of the cart.”

More oil is consumed in the _entire_ economy, but the larger part of that growth in consumption happened in the energy producing sector, while the oil available to the _remaining_ economy is getting less. What’s so difficult about that?

westexas on Thu, 18th Jun 2015 1:41 pm 



Incidentally, based on EIA + RRC data, the rate of increase from 2005 to 2013 for Texas NGL was 8.3%/year, while condensate production increased 15%/year.

The EIA shows that the 2005 to 2014 rate of increase in global NGL production was 2.7%/year.

Based on the foregoing, it’s a reasonable assumption that the rate of increase in global condensate production exceeded–and perhaps significantly exceeded–the rate of increase in global NGL production, which would of course suggest a probable decline in actual global crude oil production.

Nony on Thu, 18th Jun 2015 1:41 pm 



1. What is the source for your little red/yellow % fraction bar charts.

2. Yeah, NGLs are up a lot more than crude, because natural gas shale boom has been much more substantial than the oil shale boom. And yes, C2-C3 don’t go into refined products (C5+ does go into gasoline and C4 does in the winter [hence the massive summer storage tanks]…but I’m fine to agree that they are minor components in the mix). If you want to argue for keeping NGLs out that is fine…although a little less of the woe is mea conspiracy mindset would be good.

3. The cat piss remarks about condensate (50+ API) or even about light sweet crude in the 40s is just batshit insane. That is oil that sells for MORE than medium or heavy API crudes. It is a liquid mix of hydrocarbons of various lengths (very different from the few molecules in NGL). It goes through the normal processes of petroleum refining (distillation, etc.). And it actually needs LESS downstream processing (has less gasoil) which is a feature, not a bug. Light crude looks like oil, smells like oil, creates sludge in crude tanks when stored, etc. etc.

Nony on Thu, 18th Jun 2015 1:43 pm 



And it is freaking hilarious to read the peaker comments from 2005 about how we were out of light sweet crude and the only growth would come in heavy!

Nony on Thu, 18th Jun 2015 1:49 pm 



Where do you store NGLs? Gas storage tanks. These are pressure vessels.

Where do you store condensate and light sweet crude? Petroleum storage tanks. Crude tanks. Big honking metal things with internal floating roofs. The same exact steel structures that are used for heavier oil from Basra, Hibernia, California, etc. etc.

——-

So, if you want to whine about NGLs, fine. Got a point. But the condensate and light oil crying is BEE ESS.

shortonoil on Thu, 18th Jun 2015 2:02 pm 



“And one more side note: remember that those hundreds of millions of Canadian oil sands production couldn’t make it to US refineries to be cracked if they weren’t first blended with condensate in order to transport it. In fact about 25% of “oil sands oil” is actually condensate…much of it imported from the US. How critical is that condensate to the process: there is a plan to build a pipeline from S La to Alberta to haul light “oil”.”

Well Perk here’s to Rock:

The statement above is absolutely correct. Without US condensate, and LTO only about half of the present tar sands production would reach the US. It has been the primary reason for the Bakken since day one. But—-

That is not the point, and has nothing to do with the difference between energy and volume. 38% (depending on whom you ask) of the world economy is powered by oil. 19% of that is the petroleum industry itself. That economy is dependent upon the energy that is provided by that petroleum. The half (47% presently) that is the end consumer is the relevant portion. The petroleum industry does not pay for the production of that oil. Those costs must be passed on to the end consumer in some way; if they weren’t the industry would soon go broke. The energy delivered to the end consumer is the relevant metric, not the barrels. The energy (which is necessary to move things, E = F*d) is what drives the economy; again not barrels. If 1 barrel provided 1 million BTU of energy to that economy, or 1 million barrels which each provided 1 BTU, there would be the same amount of economic activity. That energy which is delivered to the end user must be able to pay for the full cost of the production. Again I will state, you are confusing energy, and volume. They are two entirely different properties of matter, and may or may not be directly correlated. The number of barrels does not determine the amount of energy delivered to the end consumer. That is determined by the the amount of energy delivered per barrel times the number of barrels. The amount of energy delivered per barrel is rapidly approaching zero as the energy to produce it approaches the total energy in a barrel of oil.

“Wrong! – more oil than ever is being used in the US and the world economy. Remember Short to hook up the horse in front of the cart.”

If more oil is being used then why have prices dropped 40%, and world inventories are hitting all time highs. Inventory reduction in the US was 2.6 mb last week, and this is the height of driving season when inventory draws can reach 20 mb. Production increases over the last two years have been less than half the previous 50 year average. The only area of the economy that is using more oil is the petroleum industry itself. That is because it is taking an ever increasing amount of energy to produce oil.

Confusing energy and volume has nothing to do with 100s of millions of barrels of Canadian Tar sands oil? They are completely unrelated topics.

GregT on Thu, 18th Jun 2015 2:07 pm 



You constant cheerleading is nothing more than a futile distraction from reality Nony.

We will quit using fossil fuels, we will run out of them, or we will fry our planet. Take your pick.

http://www.resilience.org/stories/2015-06-15/the-future-history-of-political-economy-part-2

shortonoil on Thu, 18th Jun 2015 2:18 pm 



“The EIA shows that the 2005 to 2014 rate of increase in global NGL production was 2.7%/year.”

According to the Oklahoma Department of Geology condensate production has historically in that state been 3.7% of total production. Since the percent of condensate production is a function of pressure, and temperature, and most conventional wells have been found in the 4000 foot zone, that statement makes imminent sense.

Our Model suggests that conventional crude production has been in decline for several years. The evidence that you present certainly supports that conclusion.

http://www.thehillsgroup.org/

westexas on Thu, 18th Jun 2015 2:24 pm 



Cornucopians, who generally reside on Fantasy Island, seem constitutionally unable to admit that Peaks Happen, and they tend to become almost hysterical when confronted with hard data.

But back here in reality, it looks like global crude oil production has probably peaked, which will be followed by peaks in global condensate, NGL and gas production.

shortonoil on Thu, 18th Jun 2015 2:37 pm 



Davy said:

“The slightest miss to a needed required growth on average of 3% globally is deadly for the system.”

With world debt at $200 trillion, and world GDP $73, 3% growth is likely a little conservative. 3% would not even be enough to service the interest on that debt. There would also be no real capital formation taking place to develop the technology needed to handle the depletion of all the various resources being used. Just building the water infrastructure that will be needed over the next few years will likely bankrupt the US.

Apneaman on Thu, 18th Jun 2015 2:45 pm 



Corn hysterics are hilarious. Like when nony-marm lost it last fall when the price tanked and ran away for a month or two. I think he went to corn rehab where they make you read Yergin 12 hours a day until the faith is restored. AKA – doubling down.

Nony on Thu, 18th Jun 2015 2:52 pm 



In 2013, Short was predicting prices to rise. Lately he predicts them to drop. Of course, it’s pretty hard to take any of his predictions seriously (or to judge them in retrospect) when they are all in some sooper seekret report that you have to pay 39 bucks for. Then looking at his site, it’s a bunch of voodoo thermodynamics babble. Really Staniford was ten times better than this guy.

Nony on Thu, 18th Jun 2015 3:11 pm 



WT: “Cornucopians, who generally reside on Fantasy Island, seem constitutionally unable to admit that Peaks Happen, and they tend to become almost hysterical when confronted with hard data.

But back here in reality, it looks like global crude oil production has probably peaked, which will be followed by peaks in global condensate, NGL and gas production.”

———-

Of course in 2006, the peakers were predicting that North American natural gas had already peaked and would be dropping 1.5 BCF/d/year.

http://www.theoildrum.com/node/1946

Look how BAD that prediction turned out. Oh…and who do we see in the comments section, west texas?

“Interestingly, the conference organizers appended the acronym ASPO, to represent the Association for the Study of Peak Oil and Gas for this gathering. Indeed, much more time was spent discussing the North American natural gas problem than at any prior Peak Oil conference I am aware of. Prominent among the presenters addressing this situation was David Hughes of NRCan. Mr Hughes is a senior geoscientist with the Geological Survey of Canada who has been speaking widely on global and North American energy sustainability issues over the past few years to governmental agencies, industry forums and the popular press. He painted a sobering picture of North American Natural Gas Supply – in effect we are trying harder and harder and spending more energy and dollars just to maintain flat production.”

WRONG.

“With respect to supply, the good plentiful stuff has been found, pumped and used on our continent. The US peaked in production in 1973 with another peak in 2001.”

WRONG.

”
By ‘treadmill’, I mean we are drilling more and more just to stay in place. As geology turns up the speed of the treadmill, we may not be able to keep up at prices consumers can afford.”

WRONG

“And the new fad (old technology) of horizontal drilling used by Devon Energy and others, in effect gets gas out of the ground even quicker without meaningfully increasing the total EUR.”

WRONG.

“Mr. Hughes pointed out that the amount of reserves that are energetically recoverable for the non-conventional sources are much less than the total reserves in government forecasts.”

WRONG.

“We have taken the low hanging natural gas apples from the tree and now have to climb the tree. Soon we will require ladders. Eventually large ladders and parachutes. To get that last apple we might need a helicopter and commandos, who eat more than one apple a day in any case.”

WRONG.

[West texas commenting] “IMO, nonconventional gas is to conventional gas (in North America) as nonconventional oil is to conventional oil worldwide, i.e., the nonconventional sources will serve to slow, but not reverse (at least not for a very long time) the aggregate decline in natural gas and oil production.”

WRONG.

[West texas commenting] “IMO, nonconventional gas is to conventional gas (in North America) as nonconventional oil is to conventional oil worldwide, i.e., the nonconventional sources will serve to slow, but not reverse (at least not for a very long time) the aggregate decline in natural gas and oil production.”

WRONG. (9 years later and everyday life is the same; trips to Europe are commonplace.)

Nony on Thu, 18th Jun 2015 3:15 pm 



“As someone has been saying, it is a good idea to downsize now, if you have not already done so, and to try adjust your lifestyle so that you are living on 50% or less of your current income (i.e., ELP).
If you can afford it, I would still advise anyone who wants to see some of the cultural treasures in Europe to go now.”

(last WT quote)

9 years in retrospect this is some pretty bad advice. How many people ended relationships or blew life savings investing in doomsteads.

Perk Earl on Thu, 18th Jun 2015 3:21 pm 



It’s also important to remember that US refineries don’t make these products from 20 API oil, 50 API condensate or even lighter NG plant liquids. They refine blends. Blends that have varied very little for decades: 29 API to 32 API. The heavy oils have to be mixed with lighter condensates. One of the big benefits of the increased Eagle Ford condensate production is the decrease in those imports.

Short you’ve been claiming Bakken oil is camel pea, but;

Rockman wrote:

“So yes: various folks have played semantic games with “oil” for various reasons. But that doesn’t change the fact that the composition of the refinery products made from all liquid hydrocarbons hasn’t changed in the last 13 years despite the increase in “non-crude oil” production. And those volumes consumed have also increased.”

You got faced jobbed on that camel pea, and you owe Rockman a response.

Then Rockman wrote:

“And one more side note: remember that those hundreds of millions of Canadian oil sands production couldn’t make it to US refineries to be cracked if they weren’t first blended with condensate in order to transport it. In fact about 25% of “oil sands oil” is actually condensate…much of it imported from the US. How critical is that condensate to the process: there is a plan to build a pipeline from S La to Alberta to haul light “oil”.”

Don’t try to spin that some other way, like no one knows what you’re doing. Obviously you were wrong again on the camel pea bit.

Oil out of the Bakken’s, Eagle ford and other similar plays were making money before the price dropped so now they are reducing their drilling efforts, but once price goes back up they will begin drilling again. Just because it’s peaked for now doesn’t mean it won’t have another peak later. You act like you know everything about the financing but you obviously don’t.

By the way they laugh at you at Ron’s site. I was on there a few weeks back and there was some minor discussion about your website and it was laughed off as completely inaccurate. If you had any guts you’d be over there responding to them and playing out this arrogant act of yours.

I don’t have any reservations about what peak oil is the problems coming down the pike, but I do take exception to taking things I write out of context, like yesterday when you apparently thought I was claiming consumers are involved in the oil production business. Really, that’s such a crock and bull stupid routine to try and plant thing people didn’t write on them. As far as I’m concerned you’re a jackass!!!

GregT on Thu, 18th Jun 2015 3:26 pm 



How many people actually took some kind of positive action to counter climate change Nony? You are living in one of the areas most likely to be adversely affected by inaction, yet you continue to be motivated by greed?

You are a part of the problem Nony, not the solution.

Perk Earl on Thu, 18th Jun 2015 3:26 pm 



http://peakoil.com/forums/viewtopic.php?f=1&t=71458

And Short, you still haven’t responded to the link above and on the right side of the website. It’s for you, go there and respect the question with an answer.

Northwest Resident on Thu, 18th Jun 2015 3:32 pm 



It looks like Perk Earl has gone full “Nony/marmico” on us. Would it be a big surprise to learn that Perk Earl was always just another “sleeper” sock puppet that Nony has now activated? Wouldn’t surprise me at all. The rude tone, the confrontational attitude, the bullshit claims — if it looks like a Nony/marmico, quacks like a Nony/marmico and eats green slime like a Nony/marmico, then it must be a Nony/marmico.

Nony on Thu, 18th Jun 2015 4:07 pm 



Man…looking at these peak gas calls from 2006 is hilarious! Check out the sainted ASPO/TOD chart:

http://www.theoildrum.com/story/2006/11/27/61031/618#comment-133406

These guys said we would be at 10 TCF/year in 2015!

Hello!!!!

GregT on Thu, 18th Jun 2015 4:29 pm 



“Man…looking at these peak gas calls from 2006 is hilarious! Check out the sainted ASPO/TOD chart:”

And to think it only cost 8 Trillion US dollars in debt. Quite the bargain eh Nony!

Apneaman on Thu, 18th Jun 2015 4:30 pm 



Arctic Sea Ice Area Drops 320,000 Square Kilometers in Just One Day

https://robertscribbler.wordpress.com/2015/06/18/arctic-sea-ice-area-drops-320000-square-kilometers-in-just-one-day/