Oil

Interview with Sadad al Husseini—“The Facts Are There”

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Question: Assume for the moment that declines in demand have flattened and that we resume modest growth in demand in a year or so. Are there adequate new oil projects in the pipeline to meet rising demand for a few more years?

Sadad: I’ve been tracking the number of projects, globally, for a long time both in the Middle East and elsewhere—Russia, Brazil, west coast of Africa, and others. A lot of this information is in the public domain, so there is no mystery there. The International Energy Agency recently reported on the same numbers. The bottom line is that there are not enough projects…

The Season of the Witch

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In my father’s house are many mansions. Surely one of them has a room with no elephants in it….

Not to crunch too many metaphors right here at the top, but a consensus seems to be firming up in the animate jello of the Internet that we have entered the Season of the Witch. An odor of ripeness fills the virtual air — something between dead carp and apples baking. Whatever else appears to be going on in the upper stories and verdigris-tinged turrets of capital finance…the most perplexing part is that there hardly seems any safe place to preserve one’s savings.

Is the Global Oil Tank Half-Full, Is It Half-Empty…or Are We Running on Fumes?

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In his article in the New York Times September 24, “Oil Industry Sets a Brisk Pace of New Discoveries”, staff reporter Jad Mouawad cites oil discoveries totaling ten billion barrels for the first half of 2009. The Tiber field in the Gulf of Mexico alone accounts for four to six billion barrels of crude that may eventually find its way into the world oil system. Indeed, this year has seen discovery results that could end up being the best since 2000. But, the article notes, the new oil was expensive to find, it will be expensive to extract, and both exploration and production are only possible because of high levels of investment and sophisticated, expensive new technologies.

Peak Oil Not a Problem According to NY Times; Scientific American – Our Response on the Financial Aspects

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Recently, we have had two new articles aiming to put to rest people’s fears about peak oil. One is from the New York Times: Oil Industry Sets a Brisk Pace of New Discoveries It talks about the many discoveries this year, and how, if they continue at the pace they have in the first half, they will be the best since 2000. The other is from the October Scientific American, called Squeezing More Oil from the Ground…Its premise seems to be that there are a lot of promising areas that we have not yet explored. When you put this together with advances in drilling and the promises of secondary and tertiary recovery, there is a good chance that oil production will not peak for many years.

The Aftermath of the Great Recession, Part II

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The outlook for consumption growth in the over-leveraged United States is bleak. Economists Menzie Chinn and Jeffrey Frieden discussed the origins of the financial crisis, the debt situation in the U.S. and the global outlook in Reflections on the Causes and Consequences of the Debt Crisis of 2008. This text broadly describes the origin of the crisis.