[jasonraymondson]

I was a 100% believer, but recent events have shown me that we have not hit peak, and a world wide collapse will prevent peak oil from ever coming to fruition.

I still believe in finite oil, but peak oil is just not possible anymore.

A lot of you are stating volatility, but this is a complete focking reversal.

We are standing on the precipice of something greater.

I really hate having egg on my face, I am tired of getting laughed at for being a doomer.

[EnergyUnlimited]

Anyway, do you know what "peak oil" actually means?

It is about peak production, not peak price.

[gnm]

Unless the entire planet stops using oil before the peak (providing we haven't hit peak already) it WILL happen. I personally think it has already happened. Peaking in production of any finite resource is a given not an if presuming you continue to use it.

-G

[jasonraymondson]

Anyway, do you know what "peak oil" actually means?

It is about peak production, not peak price.

Yes, ass.

If we have hit it, why is oil now $40.00 a barrel. If we were on the other side of the curve, oil prices would have no choice other than go up, otherwise companies / countries would not be able to ship the oil to the refineries.

[the_sword]

Commodities (all of them) are priced on the last barrel - bushel - dozen.... When there is excess either from decreased demand on increased supply prices collapse generally below the price of production ( at least below the price of the marginal producers )... this happens because the market is trying to find equilibrium between supply-demand.


What we are experiencing now is a demand drop, not a supply increase. This has 1) collapsed prices and 2) guaranteed the majors won't bet the farm on high cost oil when demand rebounds.

The jury is still out on whether we have hit "peak oil" but if we have this is the biggest gift to an investor.... The question is do you have the balls to bet on it?!?

[mkwin]

We have $40 because spare capacity has built due to a lot of new supply coming online which will continue over the next couple of years from 2011 new supply looks low again.

I have never been a doomer but still believe we will have serious problems due to insuffcient oil production by 2012-2015.

I believe it will cause repeated recessions until we move away from the oil based economy; there will be surges in price and then big drops but we won't all turn into zombies and start fighting over food in shops like some doomers think.

[the_sword]

Code: Select all

If we have hit it, why is oil now $40.00 a barrel.

Because of 1)speculative selling of oil futures and 2) Demand has fallen more than supplies have declined.

Watch how many how priced oil fields get pushed.... get'll whack the majors now, and they won't want to get burnt again when demand picks up.

[jasonraymondson]

Commodities (all of them) are priced on the last barrel - bushel - dozen.... When there is excess either from decreased demand on increased supply prices collapse generally below the price of production ( at least below the price of the marginal producers )... this happens because the market is trying to find equilibrium between supply-demand.


What we are experiencing now is a demand drop, not a supply increase. This has 1) collapsed prices and 2) guaranteed the majors won't bet the farm on high cost oil when demand rebounds.

The jury is still out on whether we have hit "peak oil" but if we have this is the biggest gift to an investor.... The question is do you have the balls to bet on it?!?

Are you all going to try to convince me that we are using 1/4 th oil we were only 4 months ago?

[the_sword]

[code]Are you all going to try to convince me that we are using 1/4 th oil we were only 4 months ago?[code]

Absolutely not, but the price to supply is not a linear equation.

How high to you think a 2 dollar gallon of milk would be if we had a shortage of 5%? Do you think milk would be 2.10 per gallon?? I'd be more like 5-10 dollars/gallon.

What I'm trying to say minor supply excesses of shortage are greatly amplified when it comes to price.

Heck, we were worried about a shortage in corn earlier this year and corn went to 8 dollars / bushel..... If we really did have a legitimate shortage it would have been much much higher....

[RedStateGreen]

Price has nothing to do with peak oil.

But if you don't believe in peak oil, why are you here?

[NoWorries]

He is an apostate. Banish him!

[EnergyUnlimited]

Anyway, do you know what "peak oil" actually means?

It is about peak production, not peak price.

Yes, ass.

If we have hit it, why is oil now $40.00 a barrel. If we were on the other side of the curve, oil prices would have no choice other than go up, otherwise companies / countries would not be able to ship the oil to the refineries.

That is nonsense.
You can be on another side of a curve and oil prices can go low due to recession.

Shipping to refineries argument is further nonsense.

[dorlomin]

I was a 100% believer,

Here in lies a problem. The 'peak oil' theory is a scientific theory from the field of geology. No one should believe in a scientific theory, one should instead take some theories as producing better models of the physical world rather than others. The phrasing would have been better if it had read something like "after analysis of the long term trends in discovery of new fields, consumption growth, production and the costs of new fields coming online, I was in the camp of those who feel that the maximum monthly rate of production of crude and lease condensate was within a near term horizon. However the recent geopolitical and socio economic factors affecting consumption have changed my outlook to be more in the camp of......." and there is where you tell us all your new theory of oil production.

[EnergyUnlimited]

Are you all going to try to convince me that we are using 1/4 th oil we were only 4 months ago?

Slight excess of supply will substantially decrease a price and slight excess of demand will substantially increase it.

Expecting linear correlations here borders with absurdity.

[Heineken]

I was a 100% believer

Believing is not necessarily the same thing as understanding. To suddenly stop believing because of a recession-driven commodity price bust suggests you never understood PO in the first place.

My doomer position has never been strongly rooted in the PO phenomenon. For me the causation will be mostly environmental---MonteQuest stuff---and global warming related. Energy is a big part of it, but far, far from all of it.

Actually I see nuclear war (sparked by environmental, economic, and population pressures) as the proximate cause of dieoff.

[sicophiliac]

Commodities (all of them) are priced on the last barrel - bushel - dozen.... When there is excess either from decreased demand on increased supply prices collapse generally below the price of production ( at least below the price of the marginal producers )... this happens because the market is trying to find equilibrium between supply-demand.


What we are experiencing now is a demand drop, not a supply increase. This has 1) collapsed prices and 2) guaranteed the majors won't bet the farm on high cost oil when demand rebounds.

The jury is still out on whether we have hit "peak oil" but if we have this is the biggest gift to an investor.... The question is do you have the balls to bet on it?!?

I like to think I do, I am licking my chops looking at some of these dirt cheap energy stocks! RIG for example is trading at slightly above 3 times earnings !!!!! Twice that PE is still cheap, even 4 times that PE ratio is more than reasonable. This is indeed a great time to invest if you have the money to do so right now. I never thought id have the opportunity to get into the energy markets again like I can now but the short sightedness of others makes this a prime opportunity.

[NeoPeasant]

Peak is peak, whether or not above ground economic causes pre-empt below ground geological ones.

this idea is not new around here.

"I think it is quite likely that peak oil production will occur due to the effects of a recession dropping demand for an extended period, followed by the inability of the oil industry to reach previous production levels once demand begins to recover. This would mean peak would occur earlier and at a lower production rate than it would have if it had just been a matter of physical production limits.

I have been reading about the collapsing suburban housing market and it's implications for the greater economy (you know, that stuff Kunstler has been raving about all along) and the news hasn't been good. I think peak could be at hand not due to the inability to produce more, but due to a failing economy's inability to demand more. We could even see a substantial drop in oil prices due to falling demand." -Me, in Aug. 2006

http://peakoil.com/post350561.html#350561

[mefistofeles]

I still believe in finite oil, but peak oil is just not possible anymore.

Alright more oil for me! Right now oil and all the other commodities are so cheap anything at this level or lower is a real buying opportunity.

I personally hold the opposite view. That money is worthless and the oil is actually something that we need.

All those people buying Treasuries are buying a "promise" that Uncle Sam will pay off its obligations.

What are most fiat currencies, an article of faith and trust.

People NEED OIL, things such as dollars and euros can be easily replaced with new currencies. Currency is simply a means of conducting transaction and in fact has no value and of itself.

Markets are also irrational they don't allocate goods and services according to their true value, if they did we would have never had the subprime failure because banks would have realized these loans were being priced improperly.

In the end I suppose we all chose something to believe in but at this moment in history I think we're seeing another repeat of Son of Subprime repeating itself in the US Treasury market. Is the market allocating oil according to any rational model that prices in future demand and production, to me that answer is quite obvious: today's price has no bearing on the potential future scarcity of oil vis a vis demand.

I can't say that I believe so much as disbelieve. I disbelieve in Uncle Sam far more than I disbelieve in peak oil.

[jasonraymondson]

until I say differently, peak oil is dead.

so speaks zarathustra

[mos6507]

So you shall be leaving us shortly, Mr. Raymondson?