Open Thread November

It Was An Oil Bubble [Not]

When the price of a barrel of Brent crude oil peaked at a record $145.40 on July 3, 2008, there was lots of talk about “peak oil.” Industry experts were speculating about whether the price might continue to rise to $200 or even higher. Global oil demand was growing faster than global oil supply. It was widely believed that global oil reserves were likely to dwindle because all the cheap stuff had been found. The remaining reserves would require higher prices to develop. Now that the price has plunged from this year’s high of $115.15 on June 19 to Thursday’s $76.13, the focus is on how low can it go, what I called “trough oil” in late October.


Jim Rogers On Putin, Oil Prices

JR: It’s a fundamental positive for anybody who uses oil, who uses energy. It’s not a positive for places like Canada, Russia, or Australia. It seems to me that this is a bit of an artificial move. The Saudis, from what I can gather, are dumping oil because the US has told them to in order to put pressure on Russia and Iran. And it’s probably not a real move. I read about shale oil like you do. But at the same time, North Sea production is declining. Russian production will start declining next year. All the major oil fields that we know about — all the production is static or declining. So it doesn’t quite add up on any kind of medium-term basis I can see.


48 Replies to “Open Thread November”

  1. i wonder who made the submersible Putin took a dive in? i assume it’s Russian made, but the deep-diving Russian MIRS were both made in Finland. assuming that’s acrylic, it can’t go too deep.

  2. “Crimea has been part of Russia for centuries. If it weren’t for [Nikita] Khrushchev getting drunk one night, it would still have been part of Russia.”

    so i thought that this was a funny bit from the j. rogers piece. i just think to myself: what night was it that khrushchev wasn’t drunk?

  3. the first surfer girl did a nice job, the second sequence of a guy, i think that’s jaws on north shore maui. the cut-in photo looks like a local portugese girl on a board in shallow water–she probably can’t surf, but who cares?

    the only pipeline shots are near the end, a still shot of jerry lopez, i think, and a short sequnce. you can spot pipeline because it’s a left breaking tube. goofy foots like lopez used to excel there.

  4. i’m sure there are scarier roads than this one. wonder what they do when they meet a bus coming the other way?

    reminds me of a trail in colombia where we had to hug this big protruding boulder while we shuffled our boots along on the underlying ledge. the heavy backpacks we wore would have made it even hairer, so we took them off and passed them around underneath the rock.

  5. interesting exchange over at OFW:

    Dan says:
    November 16, 2014 at 1:00 pm

    I remember reading Gail Tverberg’s articles over the years, and she obviously was in the limited oil camp – ie. we are going to run out. Scarcity was/is her motto. Well, the world is a wash in OIL. We live on a Petroleum planet. She believes in the Biotic THEORY of oil, but lots of other scientists etc. don’t believe that THEORY, they believe in the Abiotic Theory. I know she isn’t stupid, but she has already been proven to NOT know what she’s talking about when it comes how oil is made and the ‘finite” amount of oil. I’m not sure if she’s was/is on the Wall Street Banker payroll, but it would sure seem like it, especially during the extreme run up in oil prices from 2006-2008. The prices went up because of the “Be Scared because oil is going to run out any day now” camp which she was/is in.

    Gail Tverberg says:
    November 16, 2014 at 6:20 pm

    What in the world are you talking about? We do in fact have limited oil supply. The issue that has changed is that demand is down, because jobs are down, which is indirectly because oil supply is down. Most people have been assuming that prices would skyrocket, because of inadequate supply. I don’t think I have been in the “prices will skyrocket” camp, certainly not very much. I look back at some of my earliest posts, and I am not saying things all that different from today. Look back at my post from April 2007, Our World is Finite? Is this a Problem? I say a lot of things I said later.

    Regarding abiotic theory, I don’t believe it. Even if a little oil were made in this manner, it wouldn’t matter. The point is that we are using the oil, far faster than it is being made. That is the same problem with depleting aquifers. We are using the water far faster than they refill. No one says that no more rain is falling from the sky–just that we are using the water far too quickly, in dry areas like California and Nebraska.

  6. i know JR is not a big gail fan, but they have one big shared insight. at about the same time, they both said to look at the demand side, when everyone else was saying supply, and i mean everyone, including myself. for the record, i believe JR was the first one to post this idea, back in daz.

  7. I’m pretty certain seals copulating with penguins is an end-times sign. Well, that and Egyptian ballerinas in platform clogs.

    Some folks have flashbacks, dave has rolling interweb epiphanys or something.

    Barkeep, hit me, a double this time.

  8. Wait – we’re running out of oil? I should probably fill up then. It was $2.39/gal (E-10) down in OKC last Friday when I passed through. Right off the I-44.

  9. shocking, why the next thing they’ll report is humans having sex with all sorts of farm animals, like sheep, cows, horses, dogs, pigs, even chickens. it may be a harbinger of the end times, dunno, or just some really lonely seals and humans.

  10. good to know, i guess, that i can drive my gas gussler right up to the moment when all hell breaks loose. this will make it easier for the fat fuck in the purple velvet jumpsuit and gold chains to drive his big black eldorado through the closed doors of the safeway, looking for some frozen food.

  11. joke: a guy visits a sheep station in the australian outback. his hosts take a shine to him and tell him “it’s olright mate” to mate with the ewes in the herd, as they do it all time, women folk being scarce and sheep being plentiful. so, the guy goes and picks out a young wooly ewe and does the deed, so to speak. he finishes up and goes back the hosts, who witnessed the whole thing. they’re all laughing at him hilariously. so the guy asks: “what’s the matter?” they all reply: “you got an ugly one!”

    drum roll, please…

  12. In particular, Ventura took issue with the large dollar amount pinned to foreign wars, arguing that “international corporations” are the ones who “truly run our country today.”

    “That’s why wars are fought — so the profiteers of war can make money,” Ventura said, pointing to the large portion of the annual budget that goes toward national security and defense.

    “If we weren’t involved in these wars, we would have more freedom,” he said.

    This is the lead in:

    (CNN) — Former wrestler and Minnesota governor Jesse Ventura has some harsh words for the armed forces this Veterans Day: If given the option today, he’d opt out of military service.

    He did NOT have harsh words for the armed forces. He had harsh words for their handlers. CNN = branch of MSM propaganda machine.

  13. A Kiwi and an Aussie are driving along in NZ and they see a ewe with it’s head stuck in a fence.
    The Kiwi says to the Aussie, “There’s no-one around, come on, lets have some fun”
    The Aussie isn’t keen but the Kiwi convinces him and offers to go first.
    After the Kiwi is finished, he says “Righto, your turn mate”
    So the Aussie slowly gets down on his knees and sticks his head in the fence.

  14. I’d imagine that every variation of sheep joke has been transposed to the Oz vs. NZ arena.
    Much like most “An Englishman, an Irishman and a Scot walk into a bar” jokes can have Aussie, Kiwi and South African variant.

  15. A bra, battery and some jumper leads go into a bar.
    The bra goes up to the bar but is refused service.
    The bra asks why and is told
    “You’re off your tits and your mates look like they’re gonna start something”

  16. a pole, a jew, and a mick walk into a bar. the pole got drunk and fell asleep in a corner. the mick got in a fight and spent the night in jail. the jew made a loan at 10% interest (weekly) to some black dude he met while taking a piss. good times had by all…

  17. very nice jokes and i love the bog ore post. the guy’s wearing oil-saturated clothes and boots (made with oil), dunno, but wonder about his polishing tools–power wheel? other than that, it could have been outakes from a video shot by the ancient vikings.

  18. Subject: Why golf is better than sex

    #10. A below par performance is considered damn good.

    #09. You can stop in the middle and have a cheeseburger and a couple of beers.

    #08. It’s much easier to find the sweet spot.

    #07. Foursomes are encouraged.

    #06. You can still make money doing it as a senior.

    #05. Three times a day is possible.

    #04. Your partner doesn’t hire a lawyer if you play with someone else.

    #03. If you live in Florida, you can do it almost every day.

    #02. You don’t have to cuddle with your partner when you’re finished.

    And the NUMBER ONE reason why golf is better than sex:

    #01… When your equipment gets old you can replace it


    “To succeed is to destroy ourselves. To fail is to destroy ourselves. That is the bind we have created. Ignore if you must climate change, biodiversity collapse, the depletion of water, soil, minerals, oil; even if all these issues miraculously vanished, the mathematics of compound growth make continuity impossible.

    “The inescapable failure of a society built upon growth and its destruction of the Earth’s living systems are the overwhelming facts of our existence. As a result, they are mentioned almost nowhere. They are the 21st century’s great taboo, the subjects guaranteed to alienate your friends and neighbours. We live as if trapped inside a Sunday supplement: obsessed with fame, fashion and the three dreary staples of middle-class conversation: recipes, renovations and resorts. Anything but the topic that demands our attention.
    Statements of the bleeding obvious, the outcomes of basic arithmetic, are treated as exotic and unpardonable distractions, while the impossible proposition by which we live is regarded as so sane and normal and unremarkable that it isn’t worthy of mention. That’s how you measure the depth of this problem: by our inability even to discuss it.”

  20. dave, from your linked post above:

    “A ‘Romantic,’ in these terms, is somebody who views the past through ‘rose-tinted spectacles,’ and desires a return to it. Somebody who, for example, idealizes rural communities and low technology cultures and doesn’t understand the harshness and horror of preindustrial life. A ‘Romantic’ is usually a bourgeois escapist, who sees ‘nature’ as welcoming rather than threatening, doesn’t realize that life before the coming of antibiotics and television was nasty, brutish and short, and is only able to hold those views because of his or her privileged position within the protective bubble of industrial society.”

    Best description of Jim Kunstler i’ve read in a long time.

  21. maybe a good time to buy crude oil again? yikes, what if you had to take delivery?

    agree it looks artificial, but my doomer colleagues are saying this could be the big one–deflationary commodities price spiral due to lack of good-paying jobs, hollowed-out middle class, them being underwater on their suburban mcmansions, credit cards maxed, with college kids going into debt and partying like there’s no tomorrow (maybe true), obamacare, climate chaos, with wells going dry everywhere, resumption of north american glaciation, etc.

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