Oil and airlines

[Benhuntn]

Tmcat hate to burst your bubble but the number one importer of oil to the US is Canada and number 2 is Mexico. Middleast falls in 4th after Venezuala. Bruno you are dead on in your points.

 

[CrimsonEclipse]

People on 'ludes should not post.

Um.... no one uses 'ludes anymore.

(he's on the Meth, man......)

CE

 

[cjs]

There isn't enough oil in Alaska to be drilled for that could bring the price per barrel down. Also, I hope you realize that although we may need to get out of Middle East oil, the price per barrel isn't determined in the Middle East. It isn't even determined by OPEC. It's not even determined by the oil companies. It's determined on the floor of the Merck Exchange in New York and a couple other exchanges around the world.

Want to see a worse situation? Burn through our reserves. It would make the current situation highly desirable.

As much as many want to drill in Alaska, what we would get out of the ground up there is really a very small drop in the bucket compared to the other supplies around the world. It would have a very minimal impact on total supplies and thus have a very minimal impact on price.

Well said. Futures traders are an easy scapegoat, but their decisions converge to where supply and demand sets the future price of oil. There's a lot of demand for oil right now, and the supply of crude is only one part of the price you pay at the pump.

Refinery capacity is stretched thin, especially as the seasons change. And thanks to environmental regulations, you're about as likely to see new refinery construction as you are to see Obama's pastor at a KKK rally. Then there's the fuel taxes ..

Head down to South America and see what fuel prices OUGHT to be. Low fuel taxes, fewer regulations, and plenty of refining capacity = cheap gas.

 

[Hovernut]

Drill Alaska (been there...it's a moonscape, not the paradise as seen on CNN)
Drill off Florida. I'm a resident and am all for it.
Develop the up to 300 billion barrel Bakken field in SD, ND, & MT.
Develop the immense oil shale field with in-situ processing in Western CO and Eastern UT.
Build coal to oil plants and tap a 300 year supply at $55/bbl
Continue development on nuclear/hydrogen until commercially viable, then tell OPEC to take a hike!

What happened in the 70s and 80s when we last attempted to go 'in-house?' OPEC crashed the price of oil and bankrupted our independents and coal to oil projects. We'll eat our own to save a few dimes at the pump. We have to have the determination to git-r-done and for good!

 

[Jim Smyth]

On another forum I hang out on there was a discussion on Peak Oil last month. One of my Friends that works in the oil industry gave his opinion on it. Very interesting views to say the least. Heres what he had wrote and makes perfect sense. Look at South America. They use Sugar Cane and developed that over the last 2o years and are now fuel self sufficient! We need to get our US A$$ in gear and start taking care of our own problems here in the states before its totally out of control!
_______________________________________________

Well I have tried to stay out of this but since you ask!!!

Will we run out of oil? Of course!
Have we reached peak oil? Hard to tell.

There are still a lot of un-discovered reserves, they are just harder and harder to harvest. Its just a bit more complicated to drill/produce oil from wells that are located in 7500 feet of water!!! The Jed Clampett days are over.

As the technology improves we are able to better forcast reserves through the use of 3-d siesmic and computer added modeling. We are able to recover more of the oil from each well than we ever have before, we are able to re-enter abandoned wells and make them produce again. Directional and horizontal drilling allows us to tap into multiple "pay zones" that in the past when have been classified as "non-recoverable".

We still have plenty of oil. How long it will last is anybodies guess.

Do not expect fuel prices to EVER return to pre-war levels. Why? Because they don't need to.

Let me explain.
OPEC still has the ability to increase production to ease the cost of fuel but they will not. Why? Becasue WE continue to tolerate the higher cost. Think about it. The main reason oil proces have reached a susatined high level is because we have not backed off on our consumption. OPEC always bowed to pressure from the US to maintain a low price per barrel by perpetuating the myth that the American people will not tolerate high prices. That and the fact that we are the largest consumer so the OPEC countries were willing to "discount" our oil. Now that the prices have continually climbed (much of that fueled by specualtion on supply) and we keep right on using record amounts, the Arabs are playing a "lets see how high" we can go game. They have no REASON to increase production, they now know we will continue as always regardless of the price!!!

The Saudis like to "hold back" 2-3 MBPD (million barrels per day). Why? Because they know we have other options. Remember this cuz I will be coming back to it.

Once again, let me explain.
Do you know where the largest untapped petroleum reserves in the world are located?
How about right smack dab in the middle of NORTH AMERICA!!! Yep! There is a large mineral deposit of what is commonly called "oil shale" that lies right in the middle of the great Rocky Mountains. The far reaching deposit is guesstimated to contain approximately 7-11 Trillion (yep that's a "T") barrels of oil. That is enough oil to last for the next 2-300 Years!!!!
The thing is, to reclaim the product would require methods more akin to strip mineing than oil drilling. The shale would need to be dug out in huge quantities and then processed to recover the petroleum. The cost and environmetal impact would be staggering.

It was believed that the cost of regular petroleum would need to be sustained at or very near $75 p/barrel to make this option ECONOMICALLY feasible. So why havent we started to go after the shale? The three reasons stated earlier: Economics, Environmentalists, and Arabs....OH MY!

The first two should kinda explain themselves. The third? Why do you think OPEC wants to "hold back" all of that production I mentioned earlier? So they can fllod the market at a time of their choosing!!!

It would go something like this.......They see us begin to develop the infrastructure to end our dependence on foreign oil and then......... WHAM-O.........they open the spigots and dump their product on the market causing the price to plummet and making it no longer feasible to go after the shale oil!!! This after we have spent BILLIONS to ramp up the processing/recovery of the "shale oil". You just think we are close to a recession now!!!!!!!!!!!!!

 

[D-Bo]

Well said. Futures traders are an easy scapegoat, but their decisions converge to where supply and demand sets the future price of oil. There's a lot of demand for oil right now, and the supply of crude is only one part of the price you pay at the pump.

Refinery capacity is stretched thin, especially as the seasons change. And thanks to environmental regulations, you're about as likely to see new refinery construction as you are to see Obama's pastor at a KKK rally. Then there's the fuel taxes ..

True. The price if oil on the Merc is is also affected by traders using crude for the last few years as a hedge against the weak dollar which also drives the price per barrel up since the dollar has been tanking.

 

[atpcliff]

Hi!

AK has enough oil to supply America for one year. It will take 10 years to get new AK oil online.

Oil is not renewable.

We need renewable fuels for the long-term (obviously). I would like my great-great-great-great-great grandchildren to have a decent life on earth. To do this, we need to start using renewable energy sources as soon as possible.

cliff
YIP

 

[whymeworry?]

How about conservation:

1) Require the EPA to set vehicle fuel mileage numbers to be based on REAL WORLD driving.

2) Require auto-manufacturers to produce 30MPG minimum vehicles within 5 yrs, 40 MPG within 10.

3) Tax new V-8 powered cars so long as oil stays above $70/ bbl, i.e., if oil is high, you pay-to-play. Want to have all that extra power that you really don't need? Get taxed on it for overtaxing the energy system.

4) Start an energy conservation policy nationwide. How much energy is wasted each night by useless lighting, i.e. landscape lighting, store lights, etc.

5) Enforce idling laws. Most states have laws penalizing idling for longer than 5 min. Do you know how much fuel you'd save if you minimized idling your car? And don't tell me about engine damage during engine start-up. Once engine is warm there is no damage to a modern engine.

6) Educate people about staying warm in the home during winter, cool during summer. Do you know how many times my kids tell me they're cold in the winter while wearing shorts/ t-shirt in the house? Instead of warming the house, I make them put on proper clothing. You know what? It works. Amazing what a pair of sweats and longsleeve shirt will save you.

7) Learn more from the Europeans. I lived there. They know a lot about energy conservation. We should all be applying some of that knowledge here.

8) Any energy tax is to be 100% solely applied to the alternative energy industry (backed up by audit by the GAO).

9) Tax credits for users and purveyors of alternative energy. HUGE TAX CREDITS. Oil companies should be prohibited from getting any access to this system though.

10) Require all states and counties to initiate a recycling program. Fed penalty if not. Money to be used for alt energy projects.

Look, I'm no hippie, California tree-hugger. I'm simply a guy who is sick of seeing big oil rape us and then demand we thank them. All it would take is a REAL leader stating the above 10 items and this country would be on it's way to energy efficiency. God forbid, GB encourage energy conservation in his State of the Union. I voted for the guy (2rd round) and deeply regret it. He can call on Americans to shop (post 9/11 solution to getting the economy going again) but he can't call on all of us to do our part and conserve? I'm not talking about altering our lives all that much here.

And I'm not at all for using taxes to get alt energy going but when soccer-moms go out and buy a v-8 powered suburban instead of a v-6 powered minivan just because they want to look cool (vs the minivan look) then we have a cultural problem in this country. I bought my wife a kid hauler that gets 30-35 MPG. Her friends are constantly whinning about the $125 they pay to fill up their SUV (and she chastises me about driving something so "un-cool"). Duh. I have no sympathy for their plight for making such pathetic purchase decisions but why should I also pay (higher at the pump) for their poor decision-making? Meaning... they add to the US demand, by driving grossly inefficient vehicles during an energy crisis, which plays an effect on prices going up.

By the way, I came up with a similar list in 2003. My friends and compadres dismissed me. Think I'm wrong now? Wait until oil hits $150-$200 within 2 years. Boone Pickens says it will. He has been right, I think, 80% of the time.

If we reduce the demand, OPEC and its army of traders will be caught on the wrong side of the spec equation and get clobbered. Besides, we all know oil is not infinate. Why not start wheening ourselves off of it now?

The silver lining is that due to our sheer size, the largest economy on earth, a 5% reduction in demand would be enough to set the oil markets on a more reasonable path.

 

[IronCityBlue]

Overall not a bad post, but the V-8 versus V-6 arguement is a bit flawed. The number of cylinders is no measure of efficiency. If you taxed V-8's more than V-6's automakers would just use more powerful V-6's in their cars. BMW M series and the Nissan Z's were primarily 6 cylinders, and the Lotus Esprit Turbo was a 4 cylinder. Often there are powerplant choices for the same car with dramatic differences in fuel consumption, yet having the same number of cylinders.

Not trying to split hairs here or anything. Just pointint out how the free market will flow like water around, through, over and under ineffective and incomplete regulations.

 

[PositiveRate]

Solar, wind, tidal.

Coastal tidal farms have the greatest potential IMO due to the source consistency and proximity to a majority of the population and lesser distances to travel in the power grid.

For cars, incentivize innovation in electric motor technology and battery storage capacity and when breakthroughs are made give it away with tax breaks and other rebates that encourage a faster acceptance of the technology.

Same thing for solar - I would have a roof full of solar panels if the costs weren't at a 20+ year break even point.

Just a few passing thoughts...

 

[79%N1]

Don't forget Hydro-Turbines. Watched a show about NYC trying these in the East river, and are powering a hugh part of Roosevelt Island soley on this power! Talk about renewable energy! As long as the river flows, the turbines spin! Think of how many cities that sit on rivers (or near) could use this.

Ps....Why 40 mpg cares in 10 yrs??? Why not 70, or 80? We figured out how to get a man to the moon from scratch in 9 years, and we can't up mpg in cars from 40 - 80, when the Japanese are already darn close. Enough of the gas guzzling 15 mph Trucks and SUV's. These are collectively driving up our consumption. When we have massive programs to reduce energy consumpion, only then will energy be affordable. The problem is, the developing of new energy is expensive in itself. But, we need to think long-term now.

 

[ACWild]

Same thing for solar - I would have a roof full of solar panels if the costs weren't at a 20+ year break even point...

Depends on the state... NJ paid 70 percent for solar panels up front and also has an SRECs program that makes the payoff relatively fast. My panels will be paid off in a five year timeframe. The SREC program is available in other states, but I'm not sure which ones. It's really the dealbreaker as to whether it's economically viable for a homeowner to go solar or not. This is in addition to not having to pay for electricity.
The instant rebate went down from 70 percent this year, but the SRECs payout is going to be doubled this summer.
I've had my panels up for over two years now. My neighbors know all about the benefits and have agreed that it's a good idea. Has any of them signed up for some? Nope. It's not about aesthetics either as they've commented that they don't look out of place. People talk about the energy problem but they don't act like it exists. Heck, my neighbor still drives her suv a block to go to work. After years of growing it, I would have to say that her butt is big enough to warrant moving that load with a truck now.

 

[jetflyer]

Oil, schmoil. Get used to the rising prices and buy you some energy and precious metal mutual funds.

Now is the time to buy. The energy funds haven't participated in the recent runups in energy. Precious metal mining company stocks have also not participated in the recent runup or decline.

Both precious metal and energy mutual funds are about to explode to the upside. Back up the truck now if you wanna make some serious coin.

Some recommendations:
Fidelity Select Natural Resources Fund (energy)
Fidelity Select Gold Fund
Oppenheimer Gold and Special Minerals Fund
RS Natural Resources Fund (energy)
Tocqueville Gold Fund
Guinness Atkinson Global Energy Fund

Adios and good luck protecting your wealth,
Jet