Dr. Bakhtiari: Replies 1, 2 & 3

EnviroEngr · Posted: Tue Sep 21, 2004 7:04 pm Post subject: Dr. Bakhtiari: Replies 1, 2 & 3

Keith_McClary:

According to his website, Dr. Bakhtiari seems to think it is a good idea to bring in western oil companies with their advanced technologies to pump out the oil as fast as possible. Nationalists in Iran, Iraq etc. would prefer the work to be done by local companies employing local workers.

Dr. Bakhtiari:

No, not "pump out the oil as fast as possible" but rather to optimize current production and recovery --- especially secondary and tertiary recovery (a lot of barrels).

Yes, it is clear local companies and local workers cannot achieve optimization. This is pure propaganda which no one believes in (it is difficult to fool the oil industry employees). So it will have to be foreign companies, and the best available the better, for all concerned --- please do bear in mind that after 'peak oil', consumers will be more interested in optimization than the producers themselves!! Foreign companies (oil, gas, services, contractors) could come and hire locals (even train some, like FLUOR used to do), would be less expensive and create local jobs.

I expect this question of local vs. foreign to slip way down the agenda as other crucial questions rise to the top (eg, terrorism in oil fields, see Stephen Hamilton Bergin at http://www.no19bus.org.uk/ *).

*{link corrected - 22-Sep-04; EE}
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buster:

You've stated that you expect gasoline to cost twice its current price at the pump very soon.

Are you satisfied with the way oil prices are currently arrived at, through OPEC response to market demand? Shouldn't the remaining oil stocks be more aggressively priced, to discourage frivolous use?

Would you have any suggestions for a better means to price oil?

Dr. Bakhtiari:

I certainly do expect gasoline prices at the pump to skyrocket: it would be in everyone's interest if they did (although the large majority wouldn't understand why). Best would be a regular (not explosive) increase, like oil prices are doing now. But I didn't say "very soon", I said "over the next 3 to 4 years", but that may be "very soon". OPEC has lost his role and raison d'etre (see INSIGHTS), I don't think its actions have any impact on prices anymore. Unless it finds "new vision", it will go straight into history's dustbin; I doubt it has the visionaries to do so (I offered my humble services two years ago and they declined, not my fault).

Yes, oil should surely be priced more aggressively, but that is exactly what 'peak oil' is doing now: pushing prices up gradually, again in everyone's interest. The higher they are, the less damage will the inevitable occasional explosion bring about. Let us hope prices do stay for some time in $40-$50 range, that would be a good thing, before taking the next step.

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Soft_Landing:

You are recently on record (during your tour of Australia) as saying that petrol prices at the pump may as much as triple within 3 to 4 years.

Wouldn't you imagine that if oil prices even vaguely approached levels that would translate to such higher prices at the pump, worldwide recession would rapidly act to haul in oil prices again?

Dr. Bakhtiari:

For that to happen in Australia will require three-digit oil prices, but I don't see how this can be avoided in the next few years. Yes, naturally such high prices would trigger global economic recession.

However, the question will soon not be "recession" but "economy" --- then the question will be "which economy?" Because with 'peak oil' we will soon enter a complete "paradigm change".