Wednesday, May 21, 2008
Boone Pickens On Oil (VIDEO LINK)
In the 1970s, a reduction in supply of just 5 per cent caused a price increase of more than 400 per cent.
Click here for the link.
NVDL: This man's comments have had a tipping point on economics and oil markets and sentiments around the world. Following these comments by Pickens' (BP OIL CEO):
Demand is 87million barrles per day
Supply is 85 million barrels every day, and the two largest producers (Russia and Saudi) are declining, struggling to even maintain these levels.
There is now widespread acceptance that the long term future is higher and higher oil prices.
Boone is actually wrong about Natural Gas being a 'replacement' or an 'alternative' to oil.
To aggravate matters, American natural-gas production is also declining, at five percent a year, despite frenetic new drilling, and with the potential of much steeper declines ahead. Because of the oil crises of the 1970s, the nuclear-plant disasters at Three Mile Island and Chernobyl and the acid-rain problem, the U.S. chose to make gas its first choice for electric-power generation. The result was that just about every power plant built after 1980 has to run on gas. Half the homes in America are heated with gas. To further complicate matters, gas isn't easy to import. Here in North America, it is distributed through a vast pipeline network. Gas imported from overseas would have to be compressed at minus-260 degrees Fahrenheit in pressurized tanker ships and unloaded (re-gasified) at special terminals, of which few exist in America. Moreover, the first attempts to site new terminals have met furious opposition because they are such ripe targets for terrorism.
No combination of alternative fuels will allow us to run American life the way we have been used to running it, or even a substantial fraction of it.
Natural gas is expensive to extract and dangerous to transport, but reserves of natural gas ought to outlast oil by 20 years (according to some estimates). Canada is now needing to use more and export less to the USA. So is everyone else. The UK is a net natural gas importer, after a brief honeymoon period when they earned handsome export revenues.
But Boone's opening statements are at least correct and accurate.
This is a fascinating look back at an article published in The Indepedent in 2007: World oil supplies are set to run out faster than expected, warn scientists
It simply confirms how little we or the so-called 'experts' know.