Michael, Nowhere in your list do you mention profits and profitability, which clearly are the drivers to the industry, to OPEC actions, to fears of shortages, etc.
I'm somewhat surprised. This, oil production, is an economic issue. And if we're not going to give credence to the importance of profit, as the peak oil theorists do not, then indeed this discussion should be suspended. ----- Original Message ----- From: "Michael Perelman" <[EMAIL PROTECTED]> To: <[email protected]> Sent: Sunday, September 09, 2007 12:18 PM Subject: Re: [PEN-L] Peak Everything > I am just concerned that people are speaking past one another. The issues are very > important, but with so many unknowns, we should be listening. Let me mention what I > would like to understand. > > The fear factor -- futures markets bidding up the price because of worries about > the Middle East, Nigeria, ... > > Prospects for new discoveries. > > Pressures from global warming. > > New technologies or social measures, such as the restriction of sprawl to limit > demand. > > New fronts in imperialism, such as the emergence of Africa as a supplier. > > The retreat to nuclear power generation. > > Increasing demand from China, India, .... > > And most of all the prospects for an intelligent analysis of the subject (not just > here on the list, but nationally, world-wide). > > I am sure that I left a lot off the table. > > > > On Sun, Sep 09, 2007 at 11:18:00AM -0400, Doug Henwood wrote: > > I don't mean to question your authority Michael, but these are > > entirely reasonable non-flamey economic points. This is an important > > issue - why can't it be discussed? Are you shutting it down just > > because it inflames one participant? > > > > Doug > > > > On Sep 9, 2007, at 11:13 AM, Michael Perelman wrote: > > > > > Please stop this! > > > > > > > > > On Sun, Sep 09, 2007 at 10:53:24AM -0400, sartesian wrote: > > >> I hardly know where to begin, given the amount of misinformation, and > > >> misconstruction of facts and theories in your post, but........ > > >> > > >> 1. Super-giant fields explored. This is unknown. There are those in > > >> the industry who argue that only the surface super-giants have been > > >> explored. Western Iraq may hold reserves equal to all currently > > >> known > > >> reserves in Iraq. Then again it may not. > > >> > > >> But either way-- the supposed negative correlation of field sizes and > > >> dates of discovery is another of the peak oil mis-theories. > > >> > > >> 2. "My solution" is precisely not to "throw money," mostly because > > >> there is no evidence that peak oil is a problem, that peak oil is > > >> driving any single aspect of capitalist activity. The invasion of > > >> Iraq, > > >> and the planned invasion of Iran, had and have absolutely nothing > > >> to do > > >> with declining supplies. Rather, the invasion, like the OPEC > > >> price run > > >> ups, have everything to do with declining rates of return and > > >> overproduction of oil, where the ease and reduced cost of production > > >> caused the price collapse of 1998. Since then, it's all been > > >> about the > > >> petroleum majors aggrandizing more profit. Check the portion of > > >> total > > >> profits reported by S&P 500 that is actually claimed by the petroleum > > >> companies. > > >> > > >> 3. As far as devaluing our currency and everyone getting bailed > > >> out with > > >> valueless dollar-- first, it's not my currency, and I couldn't give a > > >> rat's ass if and when it gets devalued, overvalued, undervalued, > > >> and or > > >> goes to zero. But as far as this mythology of the US valueless > > >> dollars, and its fiat money, and its now looming weakness in the > > >> face of > > >> BRIC (Brazil, Russia, India, China, and why not Japan, another big > > >> holder of US currency instruments?)-- that's just that, a mythology. > > >> > > >> People should look at Bernake's address in 2005 about the global > > >> savings > > >> gluts-- and keep in mind that since 2001, US industries, US > > >> producers, > > >> have spent far less of their earnings on investment and capital > > >> expansion, than they have retained to their own accounts. The > > >> "unlocking" of US housing equity to finance the "expansion" of the > > >> economy, is based on that fact, as the quickening of US household > > >> debt > > >> was financed to replaced US corporate investment, and provide the > > >> market > > >> for our now so much "stronger" trading partners. > > >> > > >> The other component of this is the rapid and dramatic swing of the US > > >> govt accounts from surplus to deficit-- a swing of some 7% of GNP in > > >> about 2 years, as once again, reduced taxes and expanded military > > >> spending put the retainer in retained earnings. > > >> > > >> ----- Original Message ----- > > >> From: "The Buffalo In Da' Midst" <[EMAIL PROTECTED]> > > >> To: <[email protected]> > > >> Sent: Sunday, September 09, 2007 9:46 AM > > >> Subject: Re: [PEN-L] Peak Everything > > >> > > >> > > >>> On 9/8/07, sartesian <[EMAIL PROTECTED]> wrote: > > >>>> How about it? How about this: Reserves, are by definition an > > >> economic > > >>>> category not geological. By definitions reserves are an amount of > > >> oil > > >>>> that can be produced in a specified period of time, using the > > >> currently > > >>>> available technology, and at a profit. > > >>>> > > >>>> You should look it up. > > >>>> > > >>>> The fact that every single peak oil theorist and advocate either > > >>>> ignores, obscures, or is simply unaware of the definition of > > >> reserves > > >>>> tells us all we really need to know about the theory, the > > >>>> theorists, > > >> its > > >>>> inevitability, and where the butter is on the bread. > > >>>> > > >>> > > >>> I'm aware of what reserves are, and the structure of geological > > >>> formations that allow FOR the creation of oil to fill those reserves > > >>> (...all found, with ALL KNOWN super-giant field explored, except > > >>> perhaps the planetary poles) and the difficulty the oil companies > > >>> are > > >>> going to have replenishing those reserves with increasingly smaller > > >>> geological formations that DON'T replenish either... at least not > > >>> for > > >>> a loooooooong time. > > >>> > > >>> If your solution is 'throw money into exploration, development & > > >>> recovery', the Iraq (and perhaps soon-to-be Iran) war, and the > > >>> ongoing > > >>> strife in Nigeria and other parts of Africa are an example of the > > >>> expenditures in cash (almost a half-trillion dollars for Iraq > > >>> currently) & social stability (MEND or some other player will > > >>> eventually destroy the Nigerian government unless the U.S. wants to > > >>> 'Somalia' them at another massive cost of war), then tell me how the > > >>> oil companies would recoup their investment? > > >>> > > >>> Pass it on to the consumer buying increasingly expensive oil into an > > >>> decreasingly valued dollar? > > >>> > > >>> I'm assuming of course that the continuation of wars made blatantly > > >>> for the sole purpose of acquiring oil will devalue our currency and > > >>> cause major sociological disturbances that will disrupt consumption > > >>> patterns as well. > > >>> > > >>> ...or does everyone just get bailed out finally with valueless > > >> dollars? > > >>> > > >>> lcm > > >>> > > > > > > -- > > > Michael Perelman > > > Economics Department > > > California State University > > > Chico, CA 95929 > > > > > > Tel. 530-898-5321 > > > E-Mail michael at ecst.csuchico.edu > > > michaelperelman.wordpress.com > > -- > Michael Perelman > Economics Department > California State University > Chico, CA 95929 > > Tel. 530-898-5321 > E-Mail michael at ecst.csuchico.edu > michaelperelman.wordpress.com >
