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The global oil market is broken, drowning in crude nobody needs
21–30 of 303 posts
Re: The global oil market is broken, drowning in crude nobody needs
#22What happened to "Peak Oil"? Was there some assumption in those projections that proved to be wrong?
Turns out the world has loads of oil, and is still discovering more, and even more natural gas, coal and so on. We’re not running out anytime soon, which is actually a problem.
Re: The global oil market is broken, drowning in crude nobody needs
#23Markets are broken when oil usage develops towards sustainable levels?
We have to drastically cut down oil use, let's not pretend that the pre-corona oil consumption was tolerable, much less desireable.
Now would be a good opportunity make internaltional agreements to cap oil consumption and extraction to its current level in shutdown, and when the shutdown starts to get rolled back, the shock will be smaller as rising demand and price mechanisms reconcile how the remaining lower oil supply gets used.
Re: The global oil market is broken, drowning in crude nobody needs
#24Keeping oil prices low punishes not only Russia but Iran and Venezuela, so that could be a major reason why the Saudis are flooding the market.
Re: The global oil market is broken, drowning in crude nobody needs
#25What happened to "Peak Oil"? Was there some assumption in those projections that proved to be wrong?
I think there is/was validity to the concept of EROEI: energy return on energy invested. The EROEI of oil has decreased over time. What they got wrong was the overall estimate of how much of this stuff there is to be extracted. The easy oil is indeed being used up, but as you invest more and more energy (EROEI decreases) the amount of oil available actually increases. Look at how much tar sands, oil shale, offshore,…
I also wonder if the peak oil computations included oil discoveries as the arctic melts.
Re: The global oil market is broken, drowning in crude nobody needs
#26I find it odd that the article does not mention the oil price war between Saudi Arabia and Russia. https://www.reuters.com/article/us-opec-oil-policies-idUSKBN...
is the price war the reason, the consequence or the accelerator of the current market?
It’s the consequence of the slowdown in demand.
Re: The global oil market is broken, drowning in crude nobody needs
#27The demand will rise again once this virus is done with.
i hope it doesnt go back to the same levels. So many people are learning to work remotely, i hope they stick to it. i dont know what that means for overall energy usage but it seems it will be cleaner
Re: The global oil market is broken, drowning in crude nobody needs
#28How to bypass free article limit?
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Re: The global oil market is broken, drowning in crude nobody needs
#29I find it odd that the article does not mention the oil price war between Saudi Arabia and Russia. https://www.reuters.com/article/us-opec-oil-policies-idUSKBN...
is the price war the reason, the consequence or the accelerator of the current market?
The price war was unintentionally started just as demand began to be wholesale destroyed by the response to the COVID pandemic. Supply was reduced, but demand was reduced even more by a halting of the global economy.
Saudia Arabia was trying to bring Russia in line with OPEC+ price targets, but Russia has enough state cash reserves and a much lower state budget break even point (~$40/barrel vs Saudi Arabia's ~$80/barrel), so here we are.