Joined: May 18, 2006 Posts: 4381 Location: Minneapolis, MN
Posted: Mon May 12, 2008 2:52 pm Post subject: Re: Peak Oil * The final sign *
Gerben wrote:
Dreamtwister wrote:
Suppose there's a pipeline that carries oil from point a to point b. Now, suppose that pipeline is west of the great divide. Now, suppose that pipeline ruptures.
Is that a shortage, or a case of supply and demand?
If it's a supply and demand issue, supplies can easily be rerouted to meet soaring demand, and prices will stabilize.
If it's a shortage, supply cannot be brought to market, no matter the price.
Just scarcity. I have a car that's still half-full with diesel. You can buy the diesel (with car if you want to) for only $ 1 mln. I'll use my bicycle till that pipeline is fixed. The weather is quite nice here atm.
Your making up a case here. I don't say a shortage can not exist, but it won't be the major case. Most of the problem of reduced supply will be a higher price. Shortage will only happen where the market fails to do its work.
Wrong! When the MOL gets to a point that pipelines lose to much pressure due to lack of product - oil is shut off. The system shuts down.
Posted: Mon May 12, 2008 6:12 pm Post subject: Re: Peak Oil * The final sign *
usncom wrote:
misterno wrote:
In free markets there is no shortage of any kind on any item because we have exchanges.
Whenever there is an item be it oil or iron ore or orange juice or whatever is short on supply, price goes up and demand goes down and the equilibrium is reached.
In the case of oil the the demand for oil in the world is not down so price keeps going up till it hits the equilibrium.
In short, there can never be shortages in free markets. Except temporary situations like war, hurricane etc
That's true on paper and in theory but in the real world that logic doesn't hold up especially when you are talking about a commodity that is finite and irreplacable.
"Let them eat cake" if the bread gets too expensive. However, if oil gets too expensive tomorrow for 80% of the population what will they substitute for it? If water shot to $1000 a pint there is no shortage for the few who could afford it but for the rest of the populace they are royally screwed.
You're playing semantics here. Very expensive oil is a SHORTAGE of Affordable oil. Lets just call it what it is....a SHORTAGE.
I love that quote to death, but Marie Antoinette, with great probability, never said it. She was demonized and made fun of by the masses to an unprecedented degree, and "let them eat cake" is most probably just some of that, but for some reason it stuck. She wasn't stupid as such, just a product of the completely unsustainable lifestyle the court of france was living at the expense of the masses...
...I see an analogy forming here! :D
Your criticism of the other poster though, I fully agree with. Free market mechanics, though a cool religion with a big cult following, doesn't play out in the real world like it should. Religions often don't.
Posted: Sat May 31, 2008 11:53 am Post subject: Re: Peak Oil * The final sign *
vision-master wrote:
Quote:
Free market mechanics
Is it that some ppl here think as long as THEY have the moola gas will NOT be an issue? Pure fantasy, ya think.
Well actually.......
So long as society + government is still in one piece I believe you can insulate yourself from the world's problems with money. The only time money cannot save your rear end is when there is literally a collapse.
A good example is in the movie Titanic where the rich man tries to bribe his way into getting a lifeboat. The ship crewman throws the money back at the rich man's face and says you can't buy your way out of this mess.
Will society reach that point eventually? --> yes.
Is it going to happen within my lifetime? --> no.
Joined: Apr 04, 2005 Posts: 473 Location: Seattle, WA
Posted: Sat May 31, 2008 3:31 pm Post subject: Re: Peak Oil * The final sign *
sittinguy wrote:
I think it has a long way to go still also, gas prices suck, but its not a big deal. I think when it hits $6 that will be when it becomes a real ISSUE. Even at that point people might have to give up thier $80 a month cell phone, boo hoo.
I don't know if you were around two years ago, but the consensus here on this board was that "once gas hit $ 4 per gallon" the crap was going to hit the fan. I've noticed that as gas increased in price, as we blew by $ 3/gallon, and now $ 4 per gallon, the "consensus" of when TSHTF keeps changing and always seems to be a $ 1 or $ 2 more per gallon than the current price. So, once we hit $ 6/gallon, people will grumble along and then people here on this board and every where else will claim that once gas hits $ 8/gallon then TSHTF...of course, once we get to $ 8/gallon people will say it occurs at $ 10/gallon and so on....
We're like a frog boiling in water. Because it happens (relatively) so slowly, we get used to the warmer water without us realizing that it is killing us. I'm not sure we'll ever know at what price the economy will wither and die. If you asked me 2 years ago, personally, I think I wrote here on this board that it was $ 4- $5 per gallon. No die off off the economy yet. I'm not sure we'll really know until after the fact.
Joined: May 18, 2006 Posts: 4381 Location: Minneapolis, MN
Posted: Sat May 31, 2008 3:35 pm Post subject: Re: Peak Oil * The final sign *
arretium wrote:
sittinguy wrote:
I think it has a long way to go still also, gas prices suck, but its not a big deal. I think when it hits $6 that will be when it becomes a real ISSUE. Even at that point people might have to give up thier $80 a month cell phone, boo hoo.
I don't know if you were around two years ago, but the consensus here on this board was that "once gas hit $ 4 per gallon" the crap was going to hit the fan. I've noticed that as gas increased in price, as we blew by $ 3/gallon, and now $ 4 per gallon, the "consensus" of when TSHTF keeps changing and always seems to be a $ 1 or $ 2 more per gallon than the current price. So, once we hit $ 6/gallon, people will grumble along and then people here on this board and every where else will claim that once gas hits $ 8/gallon then TSHTF...of course, once we get to $ 8/gallon people will say it occurs at $ 10/gallon and so on....
We're like a frog boiling in water. Because it happens (relatively) so slowly, we get used to the warmer water without us realizing that it is killing us. I'm not sure we'll ever know at what price the economy will wither and die. If you asked me 2 years ago, personally, I think I wrote here on this board that it was $ 4- $5 per gallon. No die off off the economy yet. I'm not sure we'll really know until after the fact.
Quote:
How big is the problem? Multiplying production (barrels per year) times the oil price (dollars per barrel) gives a total cost in dollars per year. It's an enormous number; tens of trillions of dollars per year. To put a scale on it, the three thin curves on the graph show the oil cost in contrast to the total world domestic product; the annual value the goods and services added up for all the world's countries. The three curves show the oil cost at one percent, two and a half percent, and five percent of the total world economic output. At $130 this morning, we are at six and a half percent.
Oil production obviously cannot consume 100 percent of the world's income. My intuitive, uninformed guess is that it cannot go above 15 percent. If we see oil at $300 per barrel, we will be looking out over the smoldering ruins of the world's economy.
Joined: Dec 25, 2005 Posts: 577 Location: Hillsboro, West Virginia
Posted: Sat May 31, 2008 7:26 pm Post subject: Re: Peak Oil * The final sign *
Roy wrote:
This presidential election cycle has confirmed to me that our electoral process is a sham. All three candidates represent the same interests for the most part. The only candidates who dared speak the truth were marginalized, ridiculed openly, and ultimately ignored.
Posted: Sat May 31, 2008 8:01 pm Post subject: Re: Peak Oil * The final sign *
Can I get a definition of TSHTF? I thought we could start with a trillion as in the USA is in debt by a trillion dollars? Or that TSHTF when the USA is owned by foreingers since thats who we owe the trillion dollars. Or when the DOLLAR isnt worth said S, as it is not now. Its scares me to think you dont think that TS has already HTF. Are we waiting for the next decimal point to move before TSHH the fan? Or for the next bank closure on a Friday,help me out here, what IS the def. of the S hitting the fan?
cube wrote:
vision-master wrote:
Quote:
Free market mechanics
Is it that some ppl here think as long as THEY have the moola gas will NOT be an issue? Pure fantasy, ya think.
Well actually.......
So long as society + government is still in one piece I believe you can insulate yourself from the world's problems with money. The only time money cannot save your rear end is when there is literally a collapse.
A good example is in the movie Titanic where the rich man tries to bribe his way into getting a lifeboat. The ship crewman throws the money back at the rich man's face and says you can't buy your way out of this mess.
Will society reach that point eventually? --> yes.
Is it going to happen within my lifetime? --> no.
Posted: Sat May 31, 2008 8:50 pm Post subject: Re: Peak Oil * The final sign *
misterno wrote:
In free markets there is no shortage of any kind on any item because we have exchanges.
Whenever there is an item be it oil or iron ore or orange juice or whatever is short on supply, price goes up and demand goes down and the equilibrium is reached.
Not.
In a normal trading market, rising prices usually result in increased supply and decreased demand, thus, bringing down prices. But the oil market isn't working that way. Supply is essentially fixed due to a lack of spare capacity and because it takes years to find new fields and bring them online. We have already picked all of the low hanging fruit.
Demand is also essentially fixed, since there is no substitute for gasoline, diesel, and jet fuel, now, or maybe ever. Biofuels are a joke.
Therein lies the rub.
Forget economics as usual. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
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She was demonized and made fun of by the masses to an unprecedented degree, and "let them eat cake" is most probably just some of that, but for some reason it stuck. She wasn't stupid as such, just a product of the completely unsustainable lifestyle the court of france was living at the expense of the masses...
