So we ARE running out of cheap oil?

I don't think the peak is that far off. We may have hit it already.

 

I read a report recently, can't remember where, that said if every car in America was capable of 20 miles per gallon the USA would not need to import any oil at all.

Any truth in that do you think? And if so, why isn't more being done to stop people driving those gas guzzling SUV's and huge trucks that every fricking soccer-mum and red-neck feels the urge to drive.

I also heard, could have been radio, that the new Humvees are so big that they do not need to adhere to laws concerning fuel immisions because when the laws were made it was assumed that a vehicle of that size would only be used for commercial purposes.

 

Because such vehicles cost auto manufacturers only a little more than a car to make, but people are willing to buy them at a large markup. American car companies can't make a profit by making small cars.

The EPA has a program where vehicles are supposed to report their fuel mileage. The H2 is exempt from this.

http://www.fueleconomy.gov

 

So we ARE running out of cheap oil?

Yes you are......but do not worry Iraq has at least 5 billion barrels a year in it.....so maybe someone in the administration can put 2 and 2 together.....Hey aren't Bush and co. over there just now?......Hmmm could be an ideal opportunity......just a thought.

 

And yet Japanese car companies, using American labor, can make a profit. Perhaps you should say "don't make a profit" instead of "can't."

 

> Perhaps you should say "don't make a profit"
> instead of "can't."

Detroit has to fund massive pension plans that Japan doesn't have to. And after decades of trying they are still less productive than Japanese car companies (something like $400 per car made in the US). Theortically they can do anything the Japanese can do, but as a practical matter I don't think they can do it.

And I don't see any large scale movement to small cars when the oil crisis starts. The large economic downturn that will result will mean people will not buy new cars, but simply use the ones they have longer.

 

And Health Care!

 

> Um, spejic, when the oil crisis starts, no one will
> be driving their cars.

Sure they will. People have the idea that oil is pumped in a steady stream until it is gone, and then there is nothing. In reality, the exhaustion curve is a bell-jar shape. There will still be wide-spread use of cars 20 years from now, just at a lower level than now. You will probably see the top 1% of people drive gasoline cars even a century or two from now.

 

Don't Panic Yet

As soon as the peak does hit, there are plenty of easy substitutes: you can make gasoline, kero and diesel from natural gas and coal. It's just moderately more expensive than the refined oil. Alcohol from biomass is another. And as has been stated, the decline will be gradual, so the capital-intensive substitutions will come online without a crisis being necessary.

Don't worry you computer geeks, your juice will still flow. This latest alarm has all the earmarks of some european chicken littles making a fuss. When the API publishes such a scare, then it's time to take notice.

An interesting aside is that those substitute fuels frequently get made by first making hydrogen, so it may be that when the peak hits the natural choice will be to just use hydrogen, at least for transportation fuel.

 

Re: Don't Panic Yet

The problem is that some fuel forms, such as coal liqification, tend to be very dirty fuels. They would need a lot of development to improve it.

 

I ran into a roughneck on his way back from Alaska while on business in Portland about three years ago. I asked him if there was any truth to the reports of oil shortages that I kept reading in the news. He says "Fcuk no. There's more oil out there than we know what to do with."

Granted, this was a very unscientific assesment. But it belayed my fears for a time. However, I still think that people should be doing more to conserve energy. I learned to get by on very little while in the military and it's something I think all people should get acustomed to.

 

I read that Fuel Cells will be available by 2010. Hybrids are already out there. If gas gets too expensive, manufacturers will just switch to producing more hybrids.

 

Re: Re: Don't Panic Yet

look at this
http://www.htinj.com/products/liquefaction.html

This has been around for awhile, it is just very capital intensive - $2billion will get you 4x as much capacity in an oil refinery, but coal is cheap.

Another route is FT Liquids, which is the hydrogen route
http://fossil.energy.gov/news/techlines/03/tl_syntroleum_dedication.html

you can do it with coal, too. Qatar is currently trying to get investors to build plants like the one above, to make some money off of their natural gas which nobody wants right now. However, the economics of it is marginal - which means that it wouldn't take much of an oil price spike to make it good.

 

Re: Don't Panic Yet

Natural gas (in North America) is being expended faster than oil. It's peak will be sooner and sharper. And coal is already being mined as fast as it can - where are you going to get the extra coal to make fuel from? Besdies, while coal is cheap, it's energy content is low. You only get back about 4 times the energy it took to dig it up and transport it, unlike oil where you typically get back hundreds of times the energy (and in some places, like Arabia, it is about a thousand). Fuel from coal, when there is nothing except coal, will be ridiculously expensive.

Newspapers won't print this problem because (in the words of Futurama) "their concerns were dismissed as depressing."

Hydrogen is not a fuel source. Water is already burned hydrogen - it takes more energy to unburn it then you get back burning it again. Getting hydrogen from carbon fuels just introduces the problems those other fuels have. Besides, it is a lousy fuel. It has very little power for the amount of space it takes up.

 

Indeed. I am in the planning stages for a new house on 13 acres I own (no existing house), and one of my design goals is "no fossil fuels". Another design goal is to reduce/minimize electricity usage (which will be difficult - I am, after all, and electrical engineer and love electrons).

My over-arching goal is to be well-positioned for potential off-grid living via solar or wind if they become feasible down the line. Or to continue to take advantage of grid power if it can be manufactured cleanly (via solar, hydro, or wind) as fossil becomes prohibitively expensive. I don't want to lock myself into fossil via propane or natural gas for heating, cooking, water-heater, etc. I'm hoping to use geothermal for most of my HVAC needs (slab radient heating/cooling, water-water heat pump to drive domestic hot water and slab fluid heating/cooling, ERV with pre-heated outdoor air via ground-loop radiator in house air intake, etc etc).

The writing is on the wall, and I want to be as prepared as possible.

 

Production always equals demand over time. It called the law of supply and demand. The supply rises and falls to meet demand. Demand rises and falls to meet supply. Pricing is how the market increases demand or decreases supply.

The Like Iraq comment was stupid. The US can't do anything aobut pricing unless it controls OPEC.

I think the poster misunderstood the phrase "where the oil is." There is a term in energy studies called "technically recoverable reserves". Energy analysts don't want to count all reserves as some of them are prohibitivly expensive like oil shale. So they come up with the idea that at $20 per barrel we have say, 1 billion barrels of oil but at $40 per barrel we have 1.5 billion barrels of technically recoverable oil. So our reserves of oil depend on "where it is."

Geographically the middle east has so much oil the planet may never run out. They have a lot and probably have more. It literally isn't worth their time to figure out exactly how much oil they have.

Other sources of liquid fuel like coal liquifaction or gas to liquids requires increadibly high oil prices to become viable. In fact, some of them never become viable because those analysts that estimate the costs of the technologies assume fixed capital costs and variable fuel costs. But as energy costs increase, the cost of manufactuing alternative energy sources, i.e. windmills, solar panels, hydro, etc. become more expensive. The fact of the matter is that the alternative to cheap oil is expensive oil.

 

Re: Re: So we ARE running out of cheap oil?

It's a finite amount, therefore it is possible to "run out". The only "local" energy source even remotely close to infinite is solar radiation.

But, like spejic said, the cost of recovery will eventually become too much to bear. At $10 a gallon of gas, I'm fairly certain that consumers will start looking for cheaper alternatives.

 

Re: Re: Re: So we ARE running out of cheap oil?

But here is the rub. Yes at $10/gal they will look for cheaper alternatives. The #1 alternative will be to just stop using energy. People will not take jobs far away from home, people wont heat their houses above 60F, etc. The alternative energy sources aren't nearly as atractive as we would like.

 

Re: Re: Re: Re: So we ARE running out of cheap oil?

We are probably one breakthru away in semiconductors from solar being truly feasible. Wind and hydro are other relatively clean, virtually limitless power sources.

But yes, people will have to reduce energy consumption. It's not that hard - use compact florescent bulbs, build more efficient houses that don't require as much energy to heat/cool, and yes, keep the thermostat set lower in the winter and higher in the summer. Less energy consumption is the exact opposite of a bad thing, while it seems you are saying it is a bad thing.

 

Re: Re: Re: Re: Re: So we ARE running out of cheap oil?

Reducing energy use is a fine thing and I like your thinking about designing a house to reduce energy. All too often JimmyBob the builder will short you in insulation or give you an inefficient heater because he found it in a repair shop. He doesn't give a rat's patoot about minimizing your long term COMBINED energy bill and your morgage. He just wants to reduce your morgage and increase his proffit. A smart consumer will gladly pay and extra $20 per month in mortgage costs to reduce their energy bill by $50.

There are two problems with "demand side management". First utility companies love the idea of producing more power. They don't push demand side management techniques. They'd rather drop in a small NG fired turbine into a growing area than pay the builders to use more insulation and not bulldoze trees around the houses. The second problem is that it doesn't make that much of a difference. Not much energy is saved. Sure a fluoecient light bulb is a cost effective thing but the net saving aren't that much compared to our total energy bill.

Now as energy prices increase, as they will over the coming decades, demand managment will make more sense and make more of a difference. Today, however, energy is cheap.

 

Re: Re: Re: Re: Re: Re: So we ARE running out of cheap oil?

I disagree. If your home is designed and built properly (maximize solar energy uptake during the winter, minimize during the summer, super air-tight and insulated), a switch to CFL bulbs can be a huge cost saver. You can cut your electricity bill by 2/3rds in a well-designed house. CFL's use less wattage per lumen, and radiate far less waste heat.

Yes, most of your electricity bill is for water heating and HVAC, but - for example - if you use geothermal heat pumps you can drastically reduce electricity expenditures on both of those areas. Yes, it's a substantial capital cost (especially to drill the ground loops), but the payback is already good, even without considering non-financial aspects like pollution and future-proofing against another energy crunch.

Of course, the biggest problem is the insistence on huge mansions, even when they don't suit real people and how we live very well. Why build a formal dining room (more space to heat/cool) when we never use such a room?