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Saudi Arabia’s Plan to Extend the Age of Oil

bloomberg.com

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Re: Saudi Arabia’s Plan to Extend the Age of Oil

#91

Post by swalsh »

acjohnson55 wrote: post #40
bkeroack wrote: post #23

Earlier quoted context omitted.

The concept of peak oil is fine (almost self-evident), just the timing has been off. Theories are easier than predictions.

Although Peak Oil won't really happen if demand drops before we hit the supply peak. We might transition to renewables and eventually fusion and never actually experience the specific dynamic Peak Oil envisioned.

That's what the origional poster was saying. See there are 3 peaks that we care about. The first is Peak American Supply, the next is Peak Traditional Worldwide supply, and the third is Peak worldwide non traditional supply.

I think he was implying that the transition to shale is an indication that we are moving to unconventional sources, thus indicating we've peaked on traditional sources.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#92

Post by crdoconnor »

fredkbloggs wrote: post #66

"Demand destruction" is nonsense. There will always be demand for hydrocarbons. Oil and its distillates remain the only viable means of fueling most motor vehicles, Tesla's hype machine notwithstanding. Even if you could somehow find the trillions of dollars needed to electrify every railway in the world and the tens of trillions more to build enough lithium batteries to replace every auto on the world's roads with a…

>Tesla's hype machine notwithstanding.

The Nissan Leaf demonstrates the real future of electric vehicles, not Tesla.

>The notion that $150 oil's modest pinching of SUV drivers' wallets will magically make all of the above go away is lunacy.

Running your car on electricity is already way cheaper than gasoline and has been for some time. The only thing needed to get most people to switch is a slightly cheaper and hardier battery. A more expensive electric car is often still cheaper in the long run.

The Saudis can see this, which is why they're worried, and that is the main reason why oil is so cheap right now and will remain so, possibly indefinitely.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#93

Post by crdoconnor »

altcognito wrote: post #51
crdoconnor wrote: post #38

Well, they've moved on a little. In 2009 their plan was to ask for compensation from countries like the US should their use of oil start to fall: http://www.nytimes.com/2009/10/14/business/energy-environmen...

I think this is the real underlying issue. SA is looking at all this oil inventory, and if their oil ends up going unsold, they lose money in the long run. This may end up being a clearance sale. My guess is that they'll try to seek a maximum price without reigniting the US shale insustry over the next year. That price might be $60/$70.

Well, it costs them virtually nothing to extract, which is why they are able to sustain such low prices for such a long time.

In the long run they are screwed by the Dutch disease. They don't create anything apart from oil, so once demand dries up, their exports shrink 90% and their economy shrinks 55%. This probably means violent revolution as well as impoverishment.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#94

Post by crdoconnor »

beat wrote: post #88
nailer wrote: post #65

Earlier quoted context omitted.

Why would Saudi Arabia be against ISIS, except as a rival? Wahhabism originates in Saudi Arabia. http://www.independent.co.uk/voices/comment/iraq-crisis-how-...

ISIS is fundamentally different from Al Qaeda and the sort of Wahhibist terrorism that the Saudis have historically been involved in. It is a direct threat to the Saudi government, and every other Arab government. I'll point out that the Saudis have actively bombed ISIS. They're militarily involved in this war. It's a huge, huge deal for them.

ISIS was actually partially funded from Saudi Arabia.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#95

Post by rwallace »

ebbv wrote: post #36
ams6110 wrote: post #30

Earlier quoted context omitted.

The world will move away from oil when the alternatives are more economical. Any other conclusion is magical thinking.

The problem is that the market price of oil an coal don't reflect the long term costs of their use. Renewable energy has all of its costs right up front. Fossil fuels have major deferred costs which allow the market to act without concern for the consequences. Which is yet another reason that the market is dumb and should not be trusted with important decisions.

Another way to look at it is that the market is smart, but like any other information processing system, can only make the right decisions if given the right inputs. For the market to make the right decisions about energy policy, the real costs of oil and coal need to be priced in, by applying pollution taxes.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#96

Post by rwallace »

at-fates-hands wrote: post #56
danieltillett wrote: post #2

... and why do we have to follow? The sooner the world moves away from oil the better.

To what? Lithium Ion battery production? That's just as bad as oil, and in some cases worse. This type of manufacturing process requires tremendous inputs of energy, particularly the forging of materials like steel, aluminum, glass and plastic. Interestingly, lightweight vehicles can sometimes be more energy-intensive to build than heavier cars because lighter metals like aluminum are harder to forge than stainless s…

One relevant consideration is that e.g. aluminum manufacturing, while energy-intensive, is also renewable-friendly. That is, suppose you have a gigawatt of solar panels. You can't use them for lighting at night without also supplying storage. But aluminum smelting can just run when the sun shines, and can be located wherever the sun is most available. Or put another way, aluminum is a good form in which to store renewable energy.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#97

Post by njharman »

melling wrote: post #25
danieltillett wrote: post #2

... and why do we have to follow? The sooner the world moves away from oil the better.

Haven't we been moving away from oil for at least 40 years, since the U.S. oil crisis in the 1970's? Carter put solar energy in the White House. Are we on the 100 plan to move away from oil?

In the 70's and early 80's economical small Japanese cars were bought in droves. Replacing the giant US gas gusslers of the 60's and 70's.

90's, 2000's oil got cheap again (or was in supply at least) and what was the hottest car model?, gigantic gas gussling SUV's?

We move away from high prices. That is all.

And what the government has been moving away from since the 70's is dependence on foreign oil. A small part of which is renewables and efficiency. But larger part has been domestic production nukes and natural gas (which US has lots of).

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#98

Post by beat »

crdoconnor wrote: post #94
beat wrote: post #88

Earlier quoted context omitted.

ISIS is fundamentally different from Al Qaeda and the sort of Wahhibist terrorism that the Saudis have historically been involved in. It is a direct threat to the Saudi government, and every other Arab government. I'll point out that the Saudis have actively bombed ISIS. They're militarily involved in this war. It's a huge, huge deal for them.

ISIS was actually partially funded from Saudi Arabia.

It was partially funded by the US too, until everyone realized what a monster it was.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#99

Post by baq »

ams6110 wrote: post #30
danieltillett wrote: post #2

... and why do we have to follow? The sooner the world moves away from oil the better.

The world will move away from oil when the alternatives are more economical. Any other conclusion is magical thinking.

fossil fuels are economical only because the environment does not ever sue for damages.

Re: Saudi Arabia’s Plan to Extend the Age of Oil

#100

Post by baq »

rwallace wrote: post #96
at-fates-hands wrote: post #56

Earlier quoted context omitted.

To what? Lithium Ion battery production? That's just as bad as oil, and in some cases worse. This type of manufacturing process requires tremendous inputs of energy, particularly the forging of materials like steel, aluminum, glass and plastic. Interestingly, lightweight vehicles can sometimes be more energy-intensive to build than heavier cars because lighter metals like aluminum are harder to forge than stainless s…

One relevant consideration is that e.g. aluminum manufacturing, while energy-intensive, is also renewable-friendly. That is, suppose you have a gigawatt of solar panels. You can't use them for lighting at night without also supplying storage. But aluminum smelting can just run when the sun shines, and can be located wherever the sun is most available. Or put another way, aluminum is a good form in which to store rene…

see also icelandic geothermal aluminum smelting industry.
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