Jet Fuel Prices WILL Be Climbing A LOT, and Soon

[T-Bags]

"These countries can increase GDP with declining oil consumption:
South Korea
Germany
Russia
Italy
United Kingdom'

Ummm, NO!

While many of those countries may have increased GDP during a period of decreased oil demand, it does not mean there is some magical relationship. For example, some of these countries may have made a transition from oil fired powerplants to other sources. Our oil use is primarily for transportation, and I'd be willing to bet a large portion of that is discretionary. Here's a little quizzy for you.

True or False:

1. During the first 4 years Darth Bush's administration, oil consumption int he US went up drastically, dwarfing the increase during the administration of the Saint Clinton. As a matter of fact, oil consumption decreased during Saint Clintons second term.

2. Oil production peaked in 2001. Since then oil production has declined significantly each year due to either OPEC cuts or real supply issues.

3. No new reserves are being found and we now see a decrease in proved reserves each year.

Key
1. False. U.S. Oil consumption in 1992 was 17.033 million BPD. In 1996 it was 18.309 MBPD in 2000 it was 19.7 MBPD and in 2004 it was 20.732 MBPD. Do the math. It appears the Dems controlling the White House is the WORST thing that can happen to oil consumption. If that weren't enough, oil consumption WENT DOWN during GHWB's administration, and was FLAT (slight decrease) during the 12 years beforre Clinton took office. This was during a period of HUGE economic growth in the US. Prior to the Reagan Admin, Carter saw a huge INCREASE in oil consumption, until his last year in office.

2. False. Oil production in 2000 was 74.941 MBPD and decreased to 74.382 MBPD in 2002. In 2005 it was 81.088 MBPD. That's about a 9% increase inproduction. IMPOSSIBLE!! PEAK OIL IS HERE!!

3. False. Proved oil reserves: 1985 770.4 Billion BOE 1995 1027.0 BBOE 2005 1200.7 BBOE

 

[jetflyer]

T-Bags,

Great points again... You are a wealth of knowledge for sure. It's nice chatting with you.

As the economy grows so does oil consumption in the U.S. Since 1983 after the oil shocks were over, the U.S. did become less dependent on oil to increase GDP. We cut our dependence in half the number of new barrels required to increase GDP by one dollar.

Where do you get that oil production peaked in 2001? That would be crazy.

We'll also find oil in 2030, but will the new oil coming online then replace the fields in decline?

Jet

 

[inline]

Hi!

Currently, to make oil from shale, natural gas is used is used in the process.

Canada has a TON of oil shale, but to convert it to oil would take ALL the natual gas in N. America.

I don't think it's a question of cost, it's a question of energy usage to make the shale oil.

With our current energy and global warming situations, renewable evergy is the ONLY way to go.

We nee an Apollo type program funded by the government, to the tune of $100B over 10 years, to develop renewable sources so we don't have to buy ANY foreign oil, and we can pull our troops out of the ME.

cliff
LRD

Wouldn't have to buy nearly as much foreign oil if democrats would let us build more refineries and drill for more oil........right here in the U.S. There hasn't been a new refinery built in the U.S. in over 30 years.

 

[jetflyer]

The article that started this thread by ATPCliff was about the Ghawar Oil field of Saudi Arabia and if it was in decline. If it is in decline, Saudi Arabia is in decline and probably the world.

Here is another article questioning the largest oil field in the world, Ghawar:

From an article entitled, "The Ghawar Oil Field: How Much is Left?" comes some proof that Ghawar may have peaked:

"Not surprisingly, there was widespread concern -- even alarm -- over a 2005 report by a major bank which indicated that Ghawar had peaked. Analyst Don Coxe, working for the Bank of Montreal, became the first representative of a major financial institution to state unequivocally his belief that Ghawar was in irreversible decline. The Canadian bank analyst did not mince words: "The kingdom's decline rate will be among the world's fastest as this decade wanes... Most importantly, Hubbert's Peak must have arrived for Gharwar, the world's biggest oilfield.""

"According to industry experts a few months ago Ghawar was producing 55 percent water -- in other words, more than half of the fluid brought to the surface was not oil. In fact, a number of signs clearly indicate that Ghawar is in decline. Back in April 2006, a Saudi Aramco spokesman admitted that its mature fields are now declining at a rate of 8 percent per year. "

Then there is a peak at the bigger picture: "So, if Ghawar is confirmed to be in decline, it likely means that the entire world is as well. Of the four oil "super-giant" oil fields, three are officially in decline: Mexico's Cantarell, Russia's Samotlor, and Kuwait's Burgan. Though Ghawar has not "officially" been so declared, the implications of the facts noted above are clear."

Having the four major oil fields of the world all go into decline when they were all increasing production a few years ago is going to be devastating to the world. The impact will be felt especially hard when their declines all begin to accelerate like Cantarell's, the North Seas or Australia's. Cantarell alone lost 500,000 barrels of oil last year. PEMEX even admits it will probably lose another 500,000 this year.

That Jack field in the Gulf that is supposed to produce oil in 2015? It is not even going to replace this loss from Cantarell that has occured in 2 years, 8 years from now.

Ghawar's field also like Cantarell has been using advanced oil recovery techniques this last decade, which has been found like in the Red Sea, Australia, and Cantarell to cause decline rates in the mid double digits after peak. When Ghawar goes it will go fast......

There is some speculation that the Saudi cuts have occurred because Saudi Arabia simply cannot maintain current levels of production. IF Ghawar has peaked and is now in terminal decline (a decline which will most likely accelerate as time goes on) we could be looking at a serious energy crisis unfolding just within the next few years. Although some peak oilers look to 2010 as the time for the peak new evidence is coming in that maybe, just maybe, we have already crossed the peak and are now on the downslope. Westexas from the OilDrum.com stated that "I estimate that net oil exports by the top 10 net oil exporters are down by about 8% from 11/05 to 11/06."

You should go to the www.theoildrum.com blog and read forecasts from the "Export land model". Importers like the United States are going to have to compete with other importers on price for for net-exports whose decline will be on the magnitude twice as high as world oil production decline because oil exporters' economies will continue to thrive causing their internal consumption to continue to increase at incredible rates.

The Bottom line is net oil exports available to importers like the U.S. will diminish much faster than overall oil production.

Jet

 

[jetflyer]

Wouldn't have to buy nearly as much foreign oil if democrats would let us build more refineries and drill for more oil........right here in the U.S. There hasn't been a new refinery built in the U.S. in over 30 years.

Refineries are increasing their ability to refine more oil by expanding existing facilities because like you said they can't build new ones. This is a non-factor. A lot of them are switching to refine more heavy sour oil which is what is left as light sweet oil has already peaked.

You're right we need to drill in Alaska, off both coasts, in my Grandma's back yard if we have to!!

The problem is it won't matter much for the world or even the U.S....
ANWAR is supposed to provide 5% of our oil in 2016. This will not even replace domestic delines, let alone world declines...

You do realize we used to be the largest oil producer of the world in the United States and now we have declined by half. There are some fields that can stop our decline, but probably not increase it because there is just such a massive amount of oil production going down year over year in the U.S. We only produce 1/3 of the oil we need. We are very addicted to foreign oil and this will not change in decades.

But we can't give up and the more coal we turn to oil, the more shale, tarsands, etc. and the faster we do it the easier the transition to a post-easy to pump oil world will be.

We'll probably just go to war though, since the declines for the world are probably here now.....

Saudi: 9.5 to 8.7 steadily in a year.
The World: Flat production since December 2004 at around 84-85 mbd.

Can Saudi and the world increase in 2007? That is the question on every oil analysts mind right now. No one is sure. Not even T-Bags.

Jet

 

[Usual Suspect]

The US has 0.60 billion people and consumes 28 barrels per person per year - India and China have 2.4 billion people(+-) and consume less than 1.7 barrels per person per year.

Jet

The population of the US is about 300 million, which if expressed in billions would be 0.30 billion, not 0.60 billion.

 

[jetflyer]

Usual Suspect,

Thanks I shouldn't have been posting past 3 in the morning!

Jet

 

[G100driver]

And that's why several flight departments parked large portions of their fleet and laid pilots off when oil was up around eighty? Rich people are no different thatn you or I, if it's going to increase their costs noticably, some will stop doing it or slow down.

They did? I am sure that was an excuse. Until the price of corporate aircraft and orders drop those are isolated instances as opposed to a trend.

 

[G100driver]

Usual Suspect,

Thanks I shouldn't have been posting past 3 in the morning!

Jet

Burning the midnight oil I see .... yuk yuk yuk yuk :bomb:

 

[G100driver]

Wouldn't have to buy nearly as much foreign oil if democrats would let us build more refineries and drill for more oil........right here in the U.S. There hasn't been a new refinery built in the U.S. in over 30 years.

With no competition and record profits WTF would you build more refineries?

Ask your republican friends how allowing buyouts/mergers and subsiquent closures of refineries have lowered prices?