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VK2AAB > FUEL 06.03.08 10:36l 62 Lines 2500 Bytes #999 (0) @ WW
BID : 58617_VK2AAB
Read: GUEST
Subj: Re: Peak Oil
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Sent: 080306/0823Z @:VK2AAB.#SYD.NSW.AUS.OC #:58617 [SYDNEY] FBB7.00i
From: VK2AAB@VK2AAB.#SYD.NSW.AUS.OC
To : FUEL@WW
David wrote;
The normal forces of supply and demand apply to oil as they do to any
other commodity. If demand is inelastic and rising, (as it is for oil) a
small reduction in supply causes a large increase in price.
In the case of oil, that may make non-viable deposits become economically
viable so more comes on-stream - albeit at a higher price and longer term,
the market adapts.
But what isn't factored into peak oil is political and economic
instability.
--------------------------------
Whta is happening with demand and supply is that demand is rising but supply
is virtually static at 84 million barrels (all liquids) a day.
How is this resolved ? Simply by poorer countries cutting back, hence
frequent blackouts in many African and Asia countries.
In those countries oil is the major source for power stations.
However they appear to be getting close to their minimium usage.
Higher prices do not necessarily make more supply viable.
For instance the price of oil has doubled since about 2005 yet exploration in
Australia has decreased to about 1/2 of 2005. Those figures from memory so
may be out a bit.
The reason that exploration has decreased is because the sucess rate is so
poor. It wont matter how high the price goes, if you pour billions into
exploration and find nothing, no one is interested in throwing good after
bad.
Someone mentioned capped wells in different parts of Australia.
Of course there are plenty of them, but they will either be dry or to extract a
small supply of oil may require more energy than you get out.
David mentions the risk of war. This has been addressed in many papers and
article and the risk is real unless the Transition protocol is
implemented.
One of the biggest risks is the tying up of oil, gas and coal supplies in
long term contracts by China. Visulise this;
The US, or Europe has suffered an extended shortage of oil and gas.
Their economies are in free fall.
China refuses to release some of its tied up oil supply from Africa.
Will the US and Europe pressure the African countries to cancel some of all
of their contract obligations to China ?
If the Africans refuse will the US and Europe invade ?
If they don't refuse, will China invade to enforce their contract ?
These and similar senarios are in wide discussion in public forums, heaven
knows only what is being discussed in the Pentagon and in Brussels.
73 Barry VK2AAB
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