Why Peak Oil is a Lie

Why Peak Oil is a Lie

It's NOT Peak Oil, It's NOT even the end of "Cheap Oil."

The nasty little truth is, there is plenty of Oil in the world...it's just that the "Cheap stuff " was becoming more difficult to find.

First, to talk about Oil, realise that there is oil that is easy to refine into gasoline, propane etc. and we call that "Light Sweet Crude" (think of that as that as that squeeze bottle of honey in the shape of a bear, after being in hot water for twenty minutes) and on the other end of the spectrum, "Sour Crude" (think molasses, on a cold day)

The oil that was taken out of the ground in far West Texas (Midland/Odessa area) was, and is the standard for "Light Sweet" but there is very little of that anymore because it's been drilled out over the last 20-30 years. That isn't to say that there isn't more there at deeper levels. (An aside here, when an investor looks at oil/gas leases, here in Texas, one of the most interesting things is, that many of the holders of the original leases are only selling drilling rights down to about 7500ft and keeping those mineral (oil/gas) rights below 7500ft. and if that doesn't point toward reserves at lower levels, I don't know what does)

At the other end of our Oil spectrum is "Sour Crude", main problem, it's harder to refine, because it's thicker, and more likely to contain trace minerals that we don't want like Sulfur,the good news is it's plentiful and cheap. For years the oil companies avoided "Sour Crude" like the plague, because "the return per barrel was less than other Crude".. and at this point I need to explain how Crude is refined.

The main "Tool" used in refineries is what is refered to as a "Cracking Tower"..(an extreme over simpliflication, for any Chemical Engineers that may read this, I'm a layman explaining to other laymen OK) heated Crude is introduced into the tower, as the Crude is heated it breakes down into its lighter and heavier hydrocarbons, lighter hydrocarbons like those used to formulate gasoline "float" higher and are seperated, other hydrocarbons that are used to make Diesel and kerosine are lower and at the bottom of the tower, think Road Tar. Since the "thicker the crude, the fewer light hydrocarbons" the lower the return of gallons of gasoline relative to gallons of Diesel.

For every problem, there is a solution..and it's not to "Circle the Toyotas,Pilgrims..

The methods being used to "Re-Refine" Crude, to increase its lighter hydrocarbon makeup are to increase the heat and pressure used, and to add other" pre-refined" hydrocarbons (like kerosine) to thin the crude (and even Steam)

If you have purchased unleaded or Diesel that was refined by Valero USA, (Valero is baised in France) it started out as"Sour Crude".

Another "kicker" Oil refineries in Japan and South Korea are having to STOP REFINING crude oil, they have such an OVERSUPPLY of fuel oil (Diesel) that prices for it have dropped to under $20 per barrel (36 cents per gallon, wholesale) compare that with "Light Sweet" Crude (unrefined) selling for $60 That's the LARGEST percentage "spread" between refined/unrefined in history!

The ONLY thing holding up crude oil prices, are those who have purchased Crude Oil Futures, they all are DESPORATLY trying to find someone , ANYONE to sell their contracts to. In the next 12 months those who are "long" (buying) crude oil futures...will lose BILLIONS.

The problem is that "The Seven Sisters of Oil" want you buy the lie that we are running out of Oil, but so do those who want to "help" us. The FEAR industry is one of fastest growing movements today.

There have been overt price manunipulations in the last two years, but there is now an oversupply of Crude now coming onto the market...Just in time..for the Election..

Glen George

Originaly published October 2006 Yahoo360 GRGeorge

The World's Best Economy...isn't China or the U.S.A

GRGeorge's Blog

Originaly published 09/13/2006

The depressing TRUTH

The Worlds Best Economy ain't Here

What country consistently has low levels of unemployment, high wages, lower inflation, universal health care and social services, and 6 weeks of vacation per year, and for many a 30-32 hour work week?

Sweden, whose nine million people make it by some counts, the biggest Nordic country, is a particular example. In 2005, the English newspaper Guardian, , said that Sweden, was the most successful society the world had ever known. As proof, the Swedish economy grew at a annual rate of 5.6% in the second quarter of 2006, enough to trigger a spate of interest-rate rises by the central bank. Sweden's big companies, such as Ericsson, SKF, Telia and Volvo, are breaking export records.

FOR much of Europe, the past decade has been depressing. Slow growth, high unemployment and the burdens of rising public debt and falling competitiveness have renewed doubts about the sustainability of the European “social model”, which is also starting to creak under the weight of an ageing population. The youthful dynamism of America, and now of China and India, seems to be leaving the decrepit old continent in the shade. Yet there has always been one bright spot amid the gloom: Scandinavia.

In recent years defenders of the European social model—capitalism tempered by a generous and interventionist state—have taken to praising Scandinavia to the skies. The Nordic region, to go a bit wider, has the world's highest taxes and most generous welfare benefits. And yet Sweden, Finland and Denmark (Norway's oil sets it apart) have delivered strong growth and low unemployment, and rank among the world's most competitive economies. Nordic companies are strong in technology and research and development. Their health-care and educational systems are much admired. And, unlike other European countries, most Nordic states run healthy budget and current-account surpluses.

This is in part because history shows Sweden's economy to have flourished when it has been more liberal and low-tax—and to have gone off the rails when higher taxes and more regulation have been imposed.

Thirty years ago Sweden was a largely homogeneous country, but today 10% of its people (and one-seventh of those of working age) are foreign-born. Sweden's new immigrants—especially the country's fast-increasing Muslim population—have integrated poorly compared with the arrivals of the 1970s and 1980s. But the biggest problem for immigrants, as for young Swedes, is work. A study of comparable Somali groups in Sweden and Minnesota found that less than a third of working-age Somalis in Sweden had jobs, half the share in Minnesota.

The result is a worrying new group of people in Swedish society, non-assimilating immigrants, who come into the country "taking more from the system in services, than they give to the system in the form of social capital."

I'm not going to take the time to explain what I feel is a direct correlation between this and a problem with illegal immigration here in the US, some of you already get it..some of you never will, but if we REALLY want to stop people from comming across the border...modify our "anchor baby" access to public services, If a child is born here, but the mother is in the country illegally, citizenship should not be granted automatically to the child, and our laws need to be changed ..by an amendment to the constution that reflects differences between citizens and non-citizens, I know that on the surface this seems very harsh, but we must think of it as prioitising our needs..as a Father, I could never take someone else's kids to McDonald's knowing that my own child would go hungry as a result.

In Denmark, their economy has picked up to annual growth rates of over 3% per quarter since the first half of 2000, this coupled with low growth in the overall population leads to high output rates or as it best known..GDP or Gross Domestic Product per capita.

The increase in Danish growth and stability of it's labor market, is credited to a policy mix of supply-side and demand-side measures that reduced deficit spending in 1993 followed by tax reductions and strict budgetary consolidation between 1994 and 1997 which resulted in a balancing of the budget by 1997 and a budget surplus of 2.8% in 1999

( You can NOT reduce taxes unless you FIRST reduce deficit spending...there is NO point in reducing taxes alone...unless it's to make the Rich richer and to eliminate the Middle Class. Would you, if you knew that your income would decrease 10% next year, make arrangements so that your bills would increase by 10-15% in the next year?)

By placing it's focus on fiscal consolidation (like if you were to become "debt free" in your household fianances...you would pay off the Credit Card with the lowest balance and highest interest rate first..then you use the additional money that you have paying off card #1 against card #2 and so on..) Denmark was able to reduce it's general public debt to only 52.5% of annual GDP in 1999 with a mandate by law, that it can not ever exceed 60% of annual GDP.

The recipe for the perfect “Nordic model”, stretching the geography: Finland's education, Estonia's progressive tax policy, Denmark's labour market, Iceland's entrepreneurship, Sweden's management of big companies and Norway's oil. The right conclusion, in other words, is that it is wisest not to look for a single-country model at all, but just to take best practice wherever you find it.

The depressing Truth is, much of this is out of the pages of "Reaganomics" but that economic policy was never fully implemented..The Neo-Cons reversed policies that would have provided true ecconomic growth, raised the standard of living for all, lowered taxes while reducing the national debt. At the present time we don't know how bad the economy really is. The first act of the new Charman of the Federal Reserve was to stop reporting M3 money supply figures, so there is no way of knowing what the Reserve is doing with all the money it creates..making the Reserve the largest "BlackOps" in the goverment, not to mention how the Bush Adminstration is "cooking" the numbers on the economy (real unemployment in the US in the 2nd quarter of 2006 was over12% and climing).

We know the answers to our problems, Vote'm all out..

Glen George

09/13/2006