Thursday, September 3, 2009

On Vacation, Getting Ready for Grad School

Hola everyone,

I've been on vacation for the past several weeks for a much needed break from work, and for a final respite before grad school. I am very much looking forward to the challenge, education and opportunities that should present themselves over the next several years. However, considering the fact that I will be working while attending school, I would like to mention that while I'm not going away, I will regrettably have a lot less time for blogging.

That being said, I would like to cover some basic themes:


  • Peak oil will invariably occur someday, anybody with at least a few brain cells will concede this. However, the severity of decline rates is up to considerable dispute, and many - including Jean Laherrere, King Hubbert and Kjell Aleklett - have argued that peak oil will result in a slow decline in oil produciton, not a hard crash; and my work demonstrating non-OPEC crude's apparent peak in 2004, plus its snail-pace depletion rate (remember, non-OPEC crude represents a slight majority of global crude production) seems to offer strong support for this argument. Non-OPEC crude, even with drastic drops in Canterell and North Sea production, has been dipping at 1% annual depletion rates at worst; with this going rate, the world will be more than capable to adjust accordingly.

  • Oil's repeated price increases have more to do with manipulative speculation, not supply-and-demand fundamentals. Major banks buying and hording oil is a practice that started in 2004, just as oil began its price climb. As Philip K. Verleger Jr. said fairly recently, the ongoing oil glut: "is the largest and longest continuous glut of supply that I have seen in 30 years of following energy prices."


  • Disruptive technologies are not necessarily overrated. Sure, plenty of them are "flash in the pan" ideas that don't pan out; I personally expect many such works listed on my blog to fizzle out; and no, I'm not counting on fusion-powered hovercrafts anytime soon. However, breakthroughs do occur and they can change the world. Shale gas extraction is one such example: several years ago, the US was suppose to be heading off of a "natural gas cliff," with production going into a nose dive, thus forcing us to become dependent on imported gas overseas. Now thanks to "fraccing," the US has more natural gas than it knows what to do with - 100 years worth - and nations are taking note. Oil Drum writer and energy guru Robert Rapier, a talented individual whom I do respect, is vocal for his frequent skepticism of disruptive technologies; and yet he took nearly a year to finally admit shale gas would provide the US with ample gas supplies, stating that "we have enough natural gas available that civilization isn't going to end any time soon due to lack of energy supplies." Anyway, when one considers disruptive technologies, the difficulties of developing them, remember this: how many pilots had to die to break the sound barrier? While many such developments will fizzle, remember, it only takes one to have a major impact.


  • The peak oil community by in large has a porous, humiliating record of prophecies that's nearly as old as the oil industry is itself. Not much has changed with these goons; they refuse to learn from their mistakes. Ghwar Guzzler, Peakers' Hall of Shame, Peak Oil Debunked and Freddy Hutter's site, Trendlines, goes into into great detail exposing the hype, the far misses and repeated blunders of these goons. Somebody might say: "But Ken Deffeyes is a professor in geology, he has a successful record of assisting drilling companies finding natural gas." I will not dispute this; however, this doesn't help the fact the man has nine failed peak oil predictions to his name. Certain people, when contemplating the future, have a habit of falling for panic first without taking in smart consideration of rationalizing the details; and after all, it was computer geniuses with PhDs who warned us in the '90s of the imminent dangers of Y2K.

  • The peak oil community has a bad habit of greatly underestimating technology. As I've demonstrated on my blog before, the Oil Drum - vaunted haven of peak oil high priests - stooged badly denouncing the prospect of shale gas; here's Oil Drum writer Nate Hagens burying the prospect of gas a month before the Drum admitted their mistake.

And that's it in a nutshell. While the posting will be much more sparse, I'm defiantly not going away and hope you'll pop in from time to time. That being said, I'd like to close with this: the only thing peakers get correct is that oil will peak someday. As you well know, it's paltry beyond that; and that's my theory as to why the peakers are dead wrong, and why we'll shoot for the moon and beyond: judging from the peakers' current record, if they have this much trouble getting much right in the pre-peak world, they're not going to get much right in the post peak world either.

Peace.

- Brewskie

16 comments:

  1. Good luck in grad school Brewski!

    I've been a grad student for the last 3 years, finally finishing next spring. I'll miss the late nights, pitchers of beer, and endless reading....

    What are you studying?

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  2. BB-Keep blogging dude. Writing is always good for the soul...

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  3. Good luck with your studies Brewskie!

    I hope you can find time for an occasional post, but I will totally understand if you don’t.

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  4. Thanx for the shout-out! Stay well.

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  5. Joedead,

    Mmmm... beer. Miss those wild nights. I'll be hitting mechanical engineering, btw.

    Benjamin,

    By all means if you're still thinking about writing that book, do so. Writing a book isn't necessarily hard, it's simply time consuming; and of course if you have the talent, you can go far.

    Yogi,

    Oh I'll defiantly pop in when I can. We gotta offer a prelude to everyone of what the future will bring...

    Freddy,

    Thanks! Keep up the good work.

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  6. Hey Brewskie!
    I'm one of your newest readers and, though I know your most likely busy with school at this time, I would like to know if we can expect an update at some point?

    I'm danish, and gass prises here are returning to the same outragrous levels they were at before the recession

    I used to belong in the doomer camp, but thanks to reading blogs like yours (and peakoil debunked) I returned to a more rational stance

    its a shame that your not that active anymore, and neither is peakoil debunked, there are hardly any anti-doomer bloggers left these days sadly

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  7. This comment has been removed by a blog administrator.

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  8. Brewskie?

    Its been a long while? are you still maintaining your anti-doomer stance?

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  9. Wow. It's been a while since I've checked my blog, and I see several people have written comments. To anyone who wonders... no, I have not changed one iota. I wish I could continue to write, but at the moment, I'm too damn busy between work and school.

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  10. What are you going to study in grad school?

    Petroleum engineering, by any chance?

    Master-level or doctorate?

    Were the pre-reqs hard?

    I'm in grad school. In fact I should be re-writing an essay right now, not reading your blog!

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  11. mfisher1@kumc.eduMay 19, 2010 at 3:32 PM

    Hello Brewski,

    Comment on this one.

    http://www.altenergystocks.com/archives/2010/05/eia_annual_energy_outlook_2010_peak_what_1.html


    always looking for rationale discussion.

    Thanks

    the Cycling Kansan

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  12. Hi, just stumbled across your blog. This post is a nice summary of the PO scene. Hope your studies are going well.

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  13. Hi, recently stumbled on this blog. I'm a Physicist specialized in global energy resources. Some would call me a 'doomer' but, seeing as I mostly agree with what this author says, I'm not sure what that makes the author ...

    Are you familiar with the story of Cassandra? Cassandra accurately predicted unpleasant things, but was cursed such that no one ever believed her? Human psychology imposes a double-standard on prediction and prophesy. Confidently predict rosy, positive stuff that doesn't quite happen, and people will keep listening to you. Cautiously predict unpleasant, negative stuff that doesn't happen just when you say, and people ignore you ever after. Not fair, but true.

    The author admits that peak oil will certainly occur, but seems to think it will not happen soon and that the decline rate will be less than precipitous. OK, that may well be correct. Are you familiar with the Hirsch report? The Hirsch Report determined that it was possible to avoid the worst disruptive effects of peak oil if we collectively prepare for the event 20 years in advance.

    Even the most optimistic predictions about when the peak will occur put it within about 20 years. Reasonable science puts the GROSS conventional oil peak within a few years, or a decade at most. The NET ENERGY peak of conventional oil almost certainly already occurred. When the author discusses decline rates, is he talking about GROSS decline rates or NET decline rates? There's a big difference ...

    I would like to suggest that the dangerous folks are not the overly-doomer peakists who incorrectly (possibly) predicted an oil peak a few years too early. I suggest that the truly dangerous folks are those who loudly believe, contrary to rational evidence and thought, that economic growth can continue forever because the market will provide, therefore we should IGNORE the concept of peak oil, and limits to growth in general, and DO NOTHING to prepare for it.

    Have you ever heard the phrase, "better safe than sorry"? I understand that prudence is not currently in vogue, but don't you think that, as far as providing for the future goes, a little prudence is called for? If there is a substantial chance that oil production will begin to decline, even a little, in the next couple decades, don't you think we should start discussing the implications now?

    One final note: why rag on Ken Deffeyes? His first solid 'prediction' about the timing peak oil was when he claimed that the peak had probably just occurred in 2005. Note that he was talking about 'conventional oil', not 'all liquids'. Well, now it's 2011, six years later and, guess what, conventional oil production has still not exceeded production totals of November 2005. It is still possible that it will but, as of right now, it seems that Professor Deffeyes was probably correct. Even the US Energy Information Agency agrees. So why rag on him?

    Thank you for writing about this important topic!

    Regards,

    Bruce Stephenson
    energyscholar@gmail.com

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    Replies
    1. Bruce,

      OMG! This is the 1st time I've checked this blog in eons - I can't believe someone actually wrote! I was thinking about doing an update anyway, just for the hell of it... I ended up getting busy, and basically I just got bored of peak oil afterward; I still am.

      But to answer your question, Bruce, if you read some of my posts - including this one - you'll see that while peak oil will happen, or perhaps has already happened, I didn't really think it'd be a big deal: I've been predicting for years that peak oil will either result in a prolonged plateau, or a slow decline; and if fact, you yourself admit global production's been flat since the middle of last decade.

      As mentioned in prior entries, I based this on continental oil production, which is proven to experience multi-decade plateaus (show me one continent with production swirling down t he toilet).

      So far, I don't think I've done half bad - huh?

      And the reason I take shots at Ken is the same as why I took them at the Oil Drum, and other PO doomers: they get so much wrong with their "doomer forecasts." Those lads at the Oil Drum couldn't predict a sunrise.

      So again, Ken, while peak oil will happen - and perhaps it's already happened! - and will have some unpleasant effects such as speculators loading up, or Americans bitching about filling up their pickup trucks, ultimately, I think the world will do just fine, and we'll find it won't be as big of a deal as made out in the "Long Emergency."

      Anyway, if you drop by again, be sure to keep an eye out for an update on the current energy situation; I do intend to do one!

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  14. Hi Brewskie!
    Glad to see that you have returned, I have missed the excellent posts you used to make before departing.

    Regarding the whole "Peak oil may have happened already" thing, I think many people forget how Saudi Arabia and OPEC as a whole succeded in boosting production right before the start of the 2008 recession (when the recession hit and the oil price started its rapid decline OPEC decided to restrict their production inorder to avoid a price collapse) - these restrictions remaind in place until the Libia crisis, where Saudi Arabia boosted production inorder to balance out the halt in that countrys oil production.

    Saudi Arabia again decided to boost production (or promised to do so - I dont remember if they did it). The point of it all is that the oil price remained high and even went higher after the oil production boosts, showing (in my opinion) that the oil price is out of touch with the supply and demand model)

    Then again there is the whole Shale gas revolution that so many people are talking about, which is set to change the american and even the international energy market (to such an extent that danish wind-mill producers are worried about their long term interests in the USA)

    Many regards
    Sp00ky (Denmark)

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