Article

2007-03-03 Arabia

Saudi Oil declines 8% in 2006

Archived material is restricted to Rantburg regulars and members. If you need access email fred.pruitt=at=gmail.com with your nick to be added to the members list. There is no charge to join Rantburg as a member.

Posted by Grunter 2007-03-03 00:23|| || Front Page|| [10 views since 2007-05-07] Top

#1 I read through the article and 270+ comments. "The Oil Drum" apparently draws a lot of Chimpy McHalliburton haters who are absolutely salivating at "The End of Suburbia." These people are, IMO, LLL nuts who are just waiting for the MOTHERSHIP to come and rescue them.

If KSA is actually peaking out, there would be a lot of advantages to that. Less money for terrorists comes immediately to mind. In the U.S., we've been stymied in doing what we should have done years ago, go to nuclear, because of what I consider to be bogus environmental fears. High oil prices would probably produce a consensus that would override those fears. We, as a nation, might also remember that there quite possibly are some extraordinary amounts of oil to be found off of our other two coasts, a resource we haven't even looked at because of enviro idiocy and NIMBY obstructionism.

Long story short, if SA is actually peaking out, the sky isn't falling like most of those commenters over there are hoping for. We'll adjust and go to different types of energy for some of our needs and look in other places for oil.

Posted by mac 2007-03-03 05:16|| 2007-03-03 05:16|| Front Page Top

#2 What mac said. The notion that the world is running out energy is absurd. All that is needed is sufficient incentive to move to other sources.

Although, Saudi lack of transparency may well cause serious short and medium term disruptions, i.e. the problem is lack of transparency and not lack of oil.

Posted by phil_b 2007-03-03 06:22|| 2007-03-03 06:22|| Front Page Top

#3 We'll adjust all right, even if we have to go the full Amish. If world oil production peaks & then declines, the impact on the US economy will be severe unless adequate measures are taken. Yes, a lot of whackos are interested in Peak Oil and its implications, but this does not discredit the issue. The current world economy depends on adequate supplies of cheap oil, a change in that will hurt everyone, the US (and its sprawling gasoline-dependent suburbs) especially. Putting a great effort into building nuclear power plants would be one of those adequate measures. Doubling the size of our strategic petroleum reserve would be another. A 50% "war tax" tariff on imported petroleum would be another. Increasing the capacity of the US rail system to haul a great deal more freight than it now does (rather than in diesel-powered semi trucks) would be another. A half-hearted measure would be drilling for more offshore oil. I'll believe such a bountiful supply exists when I can buy some at my corner gas station, and not until then. Sure, do it, but I doubt much will be found. All the incentive in the world is not going to produce a year's supply of $30 / barrel oil for the USA.

Posted by Anguper Hupomosing9418 2007-03-03 06:33|| 2007-03-03 06:33|| Front Page Top

#4 Increasing the capacity of the US rail system to haul a great deal more freight than it now does (rather than in diesel-powered semi trucks) would be another.

I totally agree Anguper, trains are the answer. Trains are effecient, pollute very little, and can be very reliable. As most already know, trains serve Europe and Japan quite well, but one must follow the money. Unfortunately there is far too much money made on truck tags, permits, taxes and fees of all sorts... not to mention lucrative road building contracts. Federal and state taxes on petroleum production and sales is a revenue source the gov't can hardly afford to reduce or lose.

Posted by Besoeker 2007-03-03 06:52|| 2007-03-03 06:52|| Front Page Top

#5 In the West, the rails are running at capacity. We would need to add more tracks. Attempts to do so have been blocked by the ESA. So, the greenies are preventing our use of greener transportation.

Posted by Jackal">Jackal 2007-03-03 07:17|| http://home.earthlink.net/~sleepyjackal/index.html]">[http://home.earthlink.net/~sleepyjackal/index.html] 2007-03-03 07:17|| Front Page Top

#6 Iraqi oil production is somewhere near pre-invasion levels, and set to increase in the near future, I believe. Exxon just pulled out of a tar-sands project in Venezuela, according to an article here yesterday, which means the project leaders and their knowledge are available for application to Canadian oil sands -- and if I understand correctly there is more oil in Canadian sands (I'm not sure how that works, but the many oil patch Rantburgers will be able to explain, I suspect) than in current Middle Eastern sources combined. Current Middle Eastern oil fields may be running low of the cheap, easily extracted stuff, but there is plenty available... it's just going to be at a higher price point.

Posted by trailing wife 2007-03-03 07:29|| 2007-03-03 07:29|| Front Page Top

#7 Exxon hasn't pulled out yet , but if Oogo carries out his threat to nationalize foreign-owned petroleum reserves and infrastructure in V, then there may be consequences.

Posted by mrp 2007-03-03 07:57|| 2007-03-03 07:57|| Front Page Top

#8 Estimates I've read say that the easiest 50% of world oil has already been sucked out, the other half can be extracted only at a rapidly accelerating price. OTOH, the US government is counting on increasing oil supplies for the next 40-50 years (I wish that were correct, but I don't think it is.)
Last week the legendary oilman T. Boone Pickens had this to say: "If I'm right, we're already at the peak. The price will have to go up." also "The world has been looked at. There's still oil to be found, but not in the quantities we've seen in the past. The big fields have been found and the smaller fields, well, there's not enough of them to replenish the base." also "I think there are less reserves around the world than are being reported. There are no audited reserves in the Mideast. It makes me suspicious."
Steve Forbes was at the same conference and did say with the right incentives in places such as Mexico more oil could be brought to market and prices could drop. It is as if by squeezing a turnip hard enough, you can get oil out it.

Posted by Anguper Hupomosing9418 2007-03-03 08:25|| 2007-03-03 08:25|| Front Page Top

#9 Sauooodis are purporting to be ramping up output to put revenue pressure on the MM's. We should be putting presure on the Donks to open up ANWR, and when they don't, hammer them in '08

Posted by Frank G">Frank G 2007-03-03 09:07|| 2007-03-03 09:07|| Front Page Top

#10 What is being overlooked is the idea that anything people do a lot of they get better at. If we started building nuke plants on the scale that the French did, with a standard design, the initial costs would be high but the downstream costs would be much lower. As for the gasoline-dependent suburbs, we can now make hybrids that will do the job, just not as efficiently as gasoline cars. Start pumping out several million a year of those and put a lot more emphasis into battery technology and we'll undoubtedly make them more efficient. We might very well find a way to improve the battery technology as well. Make the country run more on electricity and less on gas and resources like tidal and geothermal become much more viable; this is because the steady electrical power they generate would be used 24/7 rather than just at peak loads (electric cars plugged in overnight). We CAN do this stuff, we should probably already have been doing some of it, and there is no one in the world better prepared to meet the challenge of a high oil price environment. Make it clear to Americans that high oil prices are here permanently (due to scarcity and not government fiat) and that investing in alternatives is smart economics; do that and the change will happen a heck of a lot faster than most people expect.

Posted by mac 2007-03-03 09:14|| 2007-03-03 09:14|| Front Page Top

#11 I lurk a lot at the Oil Drum a lot, I mean a lot of kooks who survived the Year 2K crisis are hunkered down there still wanting to use their 12 acre plot and survival shack.

That said except for the kook/exploiter Stuart S. the editors are purdy level headed and it's a good place for oil news. Beware that there's a huge fear of the Federal Reserve, the Greenland Icecap Rapid Meltdown, The Collapse of the Dollar, F.I.A.T. money, A.B.A.R.T.H. money and the imminent return of Ambrose Bierce.

Posted by Shipman 2007-03-03 09:26|| 2007-03-03 09:26|| Front Page Top

#12 OMG, Ship! Not the IMMINENT RETURN OF AMBROSE BIERCE! AAAAAAAAHHHHHH!!!!! (runs screaming off into the night). /moonbat channeling off

I wonder sometimes who it is that buys all the crap you see on infomercials. I suspect it's a lot of people who regularly post on The Oil Drum.

Posted by mac 2007-03-03 09:35|| 2007-03-03 09:35|| Front Page Top

#13 You got it Mac. Same people who made best-sellers of:
The Depression of 1984
The Collapse of 1989
The Coming Era of Low Gravity
2K, More Than a Number and a Letter
F.I.A.T. More Than A Car, Less Than Gold
Glaciers On The Move?
Chickens Can Kill You
Hybrid Corn Can Kill You
I Crossed The Street, An Act of One Mans Courage

Posted by Shipman 2007-03-03 11:32|| 2007-03-03 11:32|| Front Page Top

#14 Besoeker, just exactly do you get the goods(Whatever they are) to and from the train terminal, Trains are great for moving bulk cargos, such as raw ore to shipping ports, or to steel foundries, but lousy for hauling the weekly groceries home from walmart, small scale transportation is a must, and I DON'T mean Bicycles.

Posted by Redneck Jim 2007-03-03 11:48|| 2007-03-03 11:48|| Front Page Top

#15 Trains use one fourth the energy per ton mile than rubber on the road. They are good for the long haul. The trick is to get quick, efficient intermodal transfer to trucks for the short haul to market.

On the subject of nuclear power, we need standard design reactors in secure places that use plutonium as a fuel. We have more plutonium as fissile material for weapons that we need, so we might as well use that resource somehow. In my limited nuclear physics background.

Posted by Alaska Paul">Alaska Paul 2007-03-03 12:43|| 2007-03-03 12:43|| Front Page Top

#16 R.J.

That's a good point. Not only that, but trains are not well suited for hauling anything even remotely fragile. Which is just about anything in in a home. Air ride semi trailers are the standard for anything electronic, appliances or glass etc. etc. Most trains are better suited for hauling lumber, coal etc.

However, I see no reason why trains could not be built to handle this freight. It would seem to me to make more sense for one train to haul a load of Japanese electronics to a few points on the east coast than for dozens of semi trucks. Trucks can take it from there. That's basically the model for delivery of new cars if I understand correctly.

Posted by Mike N. 2007-03-03 12:49|| 2007-03-03 12:49|| Front Page Top

#17 Please, Please do not compare rail traffic in the United States to Europe or Japan. It just doesn't fit. Europe is 10 times more populated, with cities much closer together, than the United States, especially the western part. Driving from LA to New York is the equivalent of driving from Madrid to Moscow. We frequently ship perishables from California to New York and Maine. There is nothing like that in Europe.

Most of the trains in the western US are coal trains. At least twelve of them pass through Colorado Springs every day except Sunday. Each is at least 100 cars long. Nuke power plants would be great, and I'd like to see a hundred or more built in the United States - fast breeder reactors that create the fuel for more nuke power. Maybe we could even switch our rail system to electric, removing even another small dependence on oil. Whatever we do, it's going to take time, it's going to take money, and it's going to take an awful lot of persuasion to keep the "environmentalists" from blocking it at every move with lawsuits and other nuisance measures to "keep the greedy from destroying everything".

BTW, there IS enough oil. There's plenty of oil, and new methods of getting oil from old fields are being developed every day. One thing most non-oil people don't realize is that oil is extracted from ROCK. Those oil "reservoirs" aren't pools of pure oil, it's oil in porous rock. Oil "migrates" - moves through rock - toward the highest point in the reservoir. Several abandoned fields in the midwest have been re-tapped, and are now again producing. Oil moves SLOWLY, however, and it can take 25 years for enough oil to move back into a reservoir to make it worth going back to. There are a few petroleum scientists who believe that oil is continuously being "created", and that we'll never run completely out - it'll just get harder and harder to extract it.

Also, oil production requires constant care and attention to reservoirs. Pull the oil out too fast, and you can destroy a reservoir. There are also many other ways to muck up oil extraction. I think the Iranians are making a shambles of their oilfields, looking for immediate gain at the expense of long-term production. I wouldn't be surprised if the Saudis were doing the same thing, against the advice of their "infidel" minnions.

Posted by Old Patriot">Old Patriot 2007-03-03 13:25|| http://oldpatriot.blogspot.com/]">[http://oldpatriot.blogspot.com/] 2007-03-03 13:25|| Front Page Top

#18 "Saudi Oil declines 8% in 2006"

#17 OP: "I think the Iranians are making a shambles of their oilfields, looking for immediate gain at the expense of long-term production. I wouldn't be surprised if the Saudis were doing the same thing, against the advice of their "infidel" minnions."

Awwwwwwww - ain't that just too bad.

Posted by Barbara Skolaut">Barbara Skolaut 2007-03-03 14:08|| http://ariellestjohndesigns.com/page/15bk1/Home_Page.html]">[http://ariellestjohndesigns.com/page/15bk1/Home_Page.html] 2007-03-03 14:08|| Front Page Top

#19 Look out now; ya got me goin'!

Equivalent resistance per ton
(No grades, no curves, no wind, no waves)
Truck @ 40 mph 80 pounds per ton
Barge @ 20 mph 80 pounds per ton
Train @ 40 mph 10 pounds per ton
Train @ 65 mph 20 pounds per ton

(Resistance must be overcome by energy; i.e., fuel.)

and -

Savings to Consumer Goods
In Austin, Texas, in 1999

A freight car of lumber cost $2,200 from Washington or Oregon to a rail siding.

Home Depot (for example) had to rail-haul it to San Antonio and truck it to Austin (on three trucks, on I-35) at $600 per truckload.

Who do you think pays for the extra cost?

Not to mention that -

American freight railroads are the envy of the world both efficient and profitable.

Railroads help keep transportation costs down from lumber and automobiles and electricity to orange juice.

Our passenger railroads are well behind the rest of the world, due to our love affair with the automobile.

Rail transit is helping keep our cities livable the D.C. area has third-worst traffic in 2003, instead of the worst!

Transit saves the average D.C. driver 27 hours of congestion each year, a 28% reduction!

However, as Jackal noted above, railroads are maxed out in many places, not only the west, and the NIMBYs (including the Mayo Clinic blocking a new coal-haul railroad thru their town) make new construction more costly and/or impossible.

Posted by Bobby 2007-03-03 14:39|| 2007-03-03 14:39|| Front Page Top

#20 No, Cars on the East Coast come straight from Japan (For Example)to East Coast Ports Savannah and Jacksonville come to mind, I once went to Toyota Automatic Transmission school, it was located by the Jacksonville pier, we could look out the window and see the steady stream of new cars and trucks being driven off the ship.

Posted by Redneck Jim 2007-03-03 14:42|| 2007-03-03 14:42|| Front Page Top

#21 Thanks for the correction Jim. I knew cars came here (MN.) on a train, but I made the ignorant assumption that they all came in from the west coast.

Posted by Mike N. 2007-03-03 16:43|| 2007-03-03 16:43|| Front Page Top

#22 Thought I would just pop my head above the tree-line here, and mention the silicon-in-petrol here in the U.K. The affected area seems to be Nationwide, with promises of pump price increases tomorrow to cover supermarket losses, which will be claimed back by them, after businesses have been crippled and bitten the dust.

Appears, lately, the silicon, (they didn't test for it, because it wasn't s'posed to be there), well, it came from the ship/vessel before landing onto these hallowed shores, so this be a trial run on the UK.

They probing our reliance.

Many sensible comments, comes down to:
Go electric, oil is for lubrication.

Posted by rhodesiafever 2007-03-03 17:09|| 2007-03-03 17:09|| Front Page Top

#23 #22 rhodesia - Hadn't heard anything about that, but it doesn't sound good. Got a link or date of a story? Does the silicon act as a contaminant, the way water does?

Posted by Barbara Skolaut">Barbara Skolaut 2007-03-03 17:48|| http://ariellestjohndesigns.com/page/15bk1/Home_Page.html]">[http://ariellestjohndesigns.com/page/15bk1/Home_Page.html] 2007-03-03 17:48|| Front Page Top

#24 One more thing (and forgive me if this has already been brought up), but if the US economy tanks because of oil resources - the whole world economy tanks because of oil resources.

The US is much better prepared to survive a tanking of our economy than the rest of the world is. I'm prepared to bet that people would be eating each other in Europe within a year.

In addition, accoding to oil explorations, this country has enough oil off its coastlines to join OPEC. The reason we do not is we'd much rather have leftists and environmentalists have their "unobstructed ocean views" than pump a few billion gallons of oil every year, be self-sufficient in the oil market, and start developing nuclear power so as to supply our real power needs.

If we are not to continue to be our own worst enemies, we need to stop being patsies (and allowing stupid shit like China drilling 90 miles off our coastline into oil resources that are rightly ours) and start walking the walk and talking the talk.

Again, I say, we need to be wolves.

Posted by FOTSGreg">FOTSGreg 2007-03-03 17:56|| www.fire-on-the-suns.com]">[www.fire-on-the-suns.com] 2007-03-03 17:56|| Front Page Top

#25 Barbara, Big scene here, messes with the burnt fuel, clogs up the sensor and gives wrong readings to the EMU, (Engine Management Unit, ie, Computer), stalls/shuts down the engine), all supply lines/tankers needing cleaned out, local garages can't supply new sensors and local garages have nowhere to store contaminated fuel. This was one easy way to do sabotage, if that was what it was.

LINK

Posted by rhodesiafever 2007-03-03 18:04|| 2007-03-03 18:04|| Front Page Top

#26 Oops, very sorry, please fix.

Posted by rhodesiafever 2007-03-03 18:06|| 2007-03-03 18:06|| Front Page Top

#27 Ship, neither the Great Depression nor the fall of Rome were predicted but they happened anyway.
Trucks are routinely used for hauling bulk cargo when (in the old days) trains would have been used. A friend drives semis over the eastern 1/2 of the US and routinely hauls 30 tons of frozen french fries from the processor to the warehouses of major grocery chains. This stuff could just as well have been hauled by train, except that the rail system is max'ed out, and (most likely) the tracks to the processor have been torn up and the right of way converted to a hike-and-bike trail. A month ago he took a 2,000 lb cargo 1000 miles in a truck that could have hauled 70,000 lb instead. That is both small scale transportation inappropriately used and a real waste of fuel.
-- Trains, besides having a huge ton-mile efficiency advantage, can also utilize more energy sources than coal & oil, they can run on electricity (think nukes) or be powered by anything else that burns hot enough to make steam.
-- If trains can haul people around, they can certainly haul other, less fragile cargo.
-- The reason why the US rail system lacks capacity is its supercession by auto & truck travel supported by fuel taxes and the road system. The reasons it won't be upgraded are legion: NIMBYism, zoning laws, the tort system and vested interests such as the highway and truck lobby. It will take time and resources to build up the rail system again, much easier to do at $3/gal than at $6. Some steps are being taken: in NM realistic and achievable plans have been announced to lay down a new passenger rail tracks in the median of I-25 from Albuquerque to near Santa Fe. Part of this new line is already in operation from just N of Albuquerque to Belen in the south. This creative use of existing resources needs to be going on all over the country.
--- "if the US economy tanks because of oil resources - the whole world economy tanks because of oil resources." -- that's a major concern of the Peak Oil theory, and makes the lefties' slogan "it's all about the oil" true and ludicrous at the same time.
--- "accoding to oil explorations, this country has enough oil off its coastlines to join OPEC" -- No way, see T. Boone Pickens in an earlier post. OPEC is doomed in any case.
-- "be self-sufficient in the oil market" - only if the USA vastly decreases its consumption/importation The petroleum scientists who believe that oil is continuously being "created" are the cargo cult of the oil industry. The matter is not "enough oil" or "running out of oil" but how much is available at a certain cost to the world. We all saw what happened to the domestic auto industry in 2006 with $3/gal gas for several months. Let your imagination work on what might happen if gas never again falls below $6/gal or if it's rationed after the Mad Mullahs get frisky and sink a supertanker in the Straits of Hormuz.

Posted by Anguper Hupomosing9418 2007-03-03 19:02|| 2007-03-03 19:02|| Front Page Top

#28 Thnx, #25 Rhodesia. The story also explains somewhat your comment about "supermarket losses"; sounds like a lot of supermarkets in the UK have gas pumps, too. That's not unheard of here in the states, but it's fairly rare, at least in the middle East Coast. Kroger is the only grocery I know that has some, and not in all their stores. It may be more prevelant in other parts of the country, but I don't think so. (Though some of the gas chains like to pretend they're markets and restaurants.)

Yeesh, that looks like a mess. Dunno about in the UK, but here it would be lawsuit city. I wonder if they'll be able to find the source of the silicon?

Hope you didn't get hit.

Posted by Barbara Skolaut">Barbara Skolaut 2007-03-03 19:39|| http://ariellestjohndesigns.com/page/15bk1/Home_Page.html]">[http://ariellestjohndesigns.com/page/15bk1/Home_Page.html] 2007-03-03 19:39|| Front Page Top

#29 Trains are only the most energy efficient means of transporting people when running at overmax capacity like in the London or Tokyo rush hour. Otherwise buses are more energy efficient and private cars despite what you hear are not too far behind.

There are no significant energy savings in building passenger rail systems.

Posted by phil_b 2007-03-03 19:43|| 2007-03-03 19:43|| Front Page Top

#30 So, what's the reason those wells are filling up around the world?

Posted by anonymous2u 2007-03-03 20:34|| 2007-03-03 20:34|| Front Page Top

#31 FOTSGreg: The US is much better prepared to survive a tanking of our economy than the rest of the world is. I'm prepared to bet that people would be eating each other in Europe within a year.

OK, let's not get melodramatic here. For a good long while (i.e., most of history), people used to walk or ride horses to their final destinations. They weren't eating each other then. The automobile has only been in existence around a hundred years. Our predecessors somehow got by without it. We'll get by even if we have to make do with motorcycles or mini-cars, as in Europe (or worse, bicycles), due to $10 a gallon gas.

Posted by Zhang Fei 2007-03-03 20:57|| http://timurileng.blogspot.com]">[http://timurileng.blogspot.com] 2007-03-03 20:57|| Front Page Top

#32 Actually, that's what they're doing in China right now. Most people can't afford cars, so they use bicycles or motorcycles. The ones who can afford cars buy mini cars*. And they're not dining on each other. Even though Chinese will eat practically anything.

* The really wealthy ones - by Chinese standards - will buy Beemers or Mercedes Benz's. But that's probably in the top 1% of Chinese incomes, since the price of a Beemer will buy you a 1200 sq foot 3 BR apartment in a nice part of town in most Chinese cities.

Posted by Zhang Fei 2007-03-03 21:07|| http://timurileng.blogspot.com]">[http://timurileng.blogspot.com] 2007-03-03 21:07|| Front Page Top

#33 #30 - those wells filling up again only matter if they deliver enough oil to make a difference to the world economy, and that ain't happening. The oil business is about delivering a sufficient quantity at a price consumers can tolerate or adapt to. Otherwise, whether or not old oil wells are filling up again is academic.

Posted by Anguper Hupomosing9418 2007-03-03 21:09|| 2007-03-03 21:09|| Front Page Top

#34 "Energy efficiency" is a very flexible standard and changes rapidly depending on energy availability. It's not carved in stone.

Posted by Anguper Hupomosing9418 2007-03-03 21:14|| 2007-03-03 21:14|| Front Page Top

#35 A month ago he took a 2,000 lb cargo 1000 miles in a truck that could have hauled 70,000 lb instead.

Ha! Truck Driver friend of mine told me a story about hauling a load of new, empty, 16 oz beer cans from Sugarland, TX to Golden CO. Weight was 5000 lbs. Cargo, what cargo? There are definitely inefficiencies in our freight systems. But there are powerful forces aligned to see that it stays that way.

Posted by Chiper Threreger8956 2007-03-03 23:11|| 2007-03-03 23:11|| Front Page Top

#36 But there are powerful forces aligned to see that it stays that way.

That's the ticket, powerful forces aligned up. Been that way forever.

IT'S THE MAN!

Posted by Shipman 2007-03-03 23:53|| 2007-03-03 23:53|| Front Page Top

#37 LOL!, the MAN!

Posted by RD 2007-03-03 23:55|| 2007-03-03 23:55|| Front Page Top

23:59 Eric Jablow
23:55 RD
23:53 Shipman
23:43 Shipman
23:38 Shipman
23:37 Jehadi
23:17 Chiper Threreger8956
23:16 DMFD
23:11 Chiper Threreger8956
22:53 Anonymoose
22:52 tu3031
22:49 Nimble Spemble
22:41 Nimble Spemble
22:38 USN, ret.
22:36 whatadeal
22:35 Zhang Fei
22:34 Nimble Spemble
22:32 Zhang Fei
22:31 USN, ret.
22:29 Nimble Spemble
22:28 Frank G
22:26 whatadeal
22:23 whatadeal
22:15 trailing wife