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MonteQuest
Elite
Joined: Sep 06, 2004
Posts: 13460
Location: Sedona, Arizona
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 Posted: Tue Aug 23, 2005 3:57 pm Post subject: Connecting the dots. |
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Well worth the read.
SLOW BOAT TO CHINA OR JUNK TALES TO DEBUNK? – THE SEQUEL
| Quote: | | This is all highly consistent with the Simmons thesis on peak oil. This is also consistent with falling VLCC [crude tanker] rates from the Middle East to Asia - but not due to lack of demand in China – it looks like it’s all about constricted or diminished supply from the Middle East. Who would bother shipping oil if they could not refine it? Perhaps Matthew Simmons should stand up and take a bow? Maybe we’re already experiencing the ‘thin edge of the wedge’ where Peak Oil is concerned, dear reader. Better fill 'er up now while it’s still cheap or better yet, buy a bike and a pair of ear muffs! It might be a long cold winter. |
Link
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MD
Community Manager
Joined: May 02, 2005
Posts: 3424
Location: Oh really?
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| Posted: Tue Aug 23, 2005 4:02 pm Post subject: Re: Connecting the dots. |
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off topic but not off title: Does anyone actually make connect-the-dots pictures any more?
On topic:
Very interesting article, as is all content on Puplava's site
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"It's not demand; It's not supply.
It's coming up with credit to buy"
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Eli
Fusion
Joined: Jun 18, 2005
Posts: 3909
Location: In a van down by the river
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| Posted: Tue Aug 23, 2005 4:41 pm Post subject: Re: Connecting the dots. |
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Nice article.
I think that is the key to the current situation few here will argue that we have reached Peak Light sweet crude. But the big thing that is being obfuscated and is not making it to the surface is that we cannot process the crappy heavy sulfur that is hitting the oil market right now.
The current problem in the oil market is worse than it appears to the average investor and broker they just read the numbers and move on. EIA numbers keep showing increasing stock piles of unrefined Oil but they do not make a distinction about what grade of oil is building up.
Saudi has said a few months ago that they were taking some oil off the market because the market did not want it, the oil was heavy sour.
So the EIA numbers are giving a false sense that things are not that bad. SA keeps talking about increasing production but all they have is heavy sour.
We do not have enough refinerys to process the light sweet we need let alone the heavy sour.
The numbers tomorrow from the EIA will show another big draw down on gasoline and an increase in inventory of unrefined oil but it will be the shite heavy sour that we cannot handle not the light sweet.
That is why I am still betting that things are going to get much much worse. In the light of the above light sweet crude is still undervalued. |
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rowante
Heavy Crude
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Joined: Apr 06, 2004
Posts: 257
Location: Sydney, Australia
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| Posted: Tue Aug 23, 2005 6:35 pm Post subject: Re: Connecting the dots. |
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Chris Vernon seems to be quite gifted at connecting the dots...
OPEC Reveal Global Light Sweet Crude Peaked
| Quote: | | Although the total volume of ‘oil’ extracted in 2004 compared with 2000 has increased, the proportions of different grades of oil have shifted. Light sweet crude is the most attractive because it is easier to refine, global refining capacity is geared to light sweet crude of which there is now a shortage. This shift in grades has resulted in a shortage of refining capacity for the available medium/heavy sour oil and tough competition for the reduced amount of light sweet oil available. |
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SD_Scott
Heavy Crude
Joined: Dec 09, 2004
Posts: 492
Location: Around somewhere
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| Posted: Tue Aug 23, 2005 7:44 pm Post subject: Re: Connecting the dots. |
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| I read that last night. Very telling. That is a great site. I snoop around there every day. |
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seldom_seen
Light Sweet Crude
Joined: Apr 12, 2005
Posts: 1984
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| Posted: Tue Aug 23, 2005 7:56 pm Post subject: Re: Connecting the dots. |
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| Eli wrote: | | I think that is the key to the current situation few here will argue that we have reached Peak Light sweet crude. But the big thing that is being obfuscated and is not making it to the surface is that we cannot process the crappy heavy sulfur that is hitting the oil market right now. |
Yes, that is a huge point. I posted the thread Towards a heavy sour crude oil world postulating that we could hit a peak in light sweet, and then bounce along for a few years until refining capacity is able to catch up with the heavy crap. Whatever the case, I see the peak of light sweet as the peak. Or maybe another way to state it would be the end of the road for cheap oil. The heavy stuff will be harder to extract and more expensive to refine.
| Eli wrote: | | That is why I am still betting that things are going to get much much worse. In the light of the above light sweet crude is still undervalued. |
I agree, I don't think the market has caught up to the real shituation. |
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