Peak Oil (Demand) Front Update 2

Hat tip to Raul Ilargi Meijer of The Automatic Earth.

Source: Bloomberg via The Automatic Earth.

The Permian shale oil basin contains as much as the Ghawar oil field did originally? That'll put supply-side Peak Oil off until the storms of our grandchildren REALLY ramp up.

US Shale Producers Weather Oil Price Storm (Ambrose Evans Pritchard - The Telegraph)

[OPEC’s] worst fears are coming true. Twenty months after Saudi Arabia took the fateful decision to flood world markets with oil, it has failed to break the back of the US shale industry. The Saudi-led Gulf states have certainly succeeded in killing off a string of global mega-projects in deep waters. Investment in upstream exploration from 2014 to 2020 will be $1.8 trillion less than previously assumed, according to consultants IHS. But this is an illusive victory. North America’s hydraulic frackers are cutting costs so fast that most can now produce at prices far below levels needed to fund the Saudi welfare state and its military machine, or to cover Opec budget deficits. 

Scott Sheffield, the outgoing chief of Pioneer Natural Resources, threw down the gauntlet last week – with some poetic licence – claiming that his pre-tax production costs in the Permian Basin of West Texas have fallen to $2.25 a barrel. “Definitely we can compete with anything that Saudi Arabia has. We have the best rock,” he said. Revolutionary improvements in drilling technology and data analytics that have changed the cost calculus faster than most thought possible. The “decline rate” of production over the first four months of each well was 90pc a decade ago for US frackers. This dropped to 31pc in 2012. It is now 18pc. Drillers have learned how to extract more. Mr Sheffield said the Permian is as bountiful as the giant Ghawar field in Saudi Arabia and can expand from 2m to 5m barrels a day even if the price of oil never rises above $55.

But oil demand is still either running behind oil supply, or is actually on the decline. Remember, consumption of fossil fuels have remained stagnant for the past three years, 2013 through 2015.

Growing Oil Glut Shows Investors There’s Nowhere to Go But Down (Bloomberg)

Money managers have never been more certain that oil prices will drop. They increased bets on falling crude by the most ever as stockpiles climbed to the highest seasonal levels in at least two decades, nudging prices toward a bear market. The excess supply hammered the second-quarter earnings of Exxon Mobil and Chevron. Inventories are near the 97-year high reached in April as oil drillers boosted rigs for a fifth consecutive week. “The rise in supplies will add more downward pressure,” said Michael Corcelli, chief investment officer at Alexander Alternative Capital, a Miami-based hedge fund. “It will be a long time before we can drain the excess.” 

Hedge funds pushed up their short position in West Texas Intermediate crude by 38,897 futures and options combined during the week ended July 26, according to the Commodity Futures Trading Commission. It was the biggest increase in data going back to 2006. WTI dropped 3.9% to $42.92 a barrel in the report week, and traded at $41.75 at 12:20 p.m. Singapore time. WTI fell by 14% in July, the biggest monthly decline in a year. It’s down by 19% since early June, bringing it close to the 20% drop that would characterize a bear market. 

U.S. crude supplies rose by 1.67 million barrels to 521.1 million in the week ended July 22, according to U.S. Energy Information Administration data. Stockpiles reached 543.4 million barrels in the week ended April 29, the highest since 1929. Gasoline inventories expanded for a third week to 241.5 million barrels, the most since April. “The flow is solidly bearish,” said Tim Evans, an energy analyst at Citi Futures Perspective in New York. “It reflects a recognition that the market is, at least for the time being, oversupplied.”

"According to David Fransen, Geneva-based head of Vitol SA, the biggest independent oil trader. 'Demand growth has faltered a bit.'” That is, demand is still growing slower than expected in response to the lowered oil prices compared to their June 2014 heights or even dropping. Now where are the latest statistics on fossil fuel demand in 2016?

Oil Glut Proves Harder To Kill Than Saudis To Goldman Predicted (Bloomberg)

The bullish spirit that gripped oil traders as industry giants from Saudi Arabia to Goldman Sachs declared the supply glut over is rapidly ebbing away. Oil is poised for a drop of 20% since early June, meeting the definition of a bear market. While excess crude production is abating, inventories around the world are brimming, especially for gasoline, and a revival in U.S. drilling threatens to swell supplies further. As the output disruptions that cleared some of the surplus earlier this year begin to be resolved, crude could again slump toward $30 a barrel, Morgan Stanley predicts. “The tables are turning on the bulls, who were prematurely constructive on oil prices on the basis the re-balancing of the oil market was a done deal,” said Harry Tchilinguirian at BNP Paribas in London. 

“It’s probably going to take a little longer than they expected.” Oil almost doubled in New York between February and June as big names from Goldman and the International Energy Agency to new Saudi Energy Minister Khalid Al-Falih said declining U.S. oil production and disruptions from Nigeria to Canada were finally ending years of oversupply. Prices retreated to a three-month low near $41 a barrel this week amid a growing recognition the surplus will take time to clear. “There’s lots of crude and refined products around,” said David Fransen, Geneva-based head of Vitol SA, the biggest independent oil trader. “Demand growth has faltered a bit.”

In closing allow me to show you the glut in oil inventories since 

Source: Bloomberg via The Automatic Earth.

And demand is certainly going to drop again once the USA summer recreational driving season is over when school starts again.

Massive Die-off in Flower Garden Reef off the LA Coast.

Federal scientists say a massive die-off is taking place on a coral reef of a national marine sanctuary in the Gulf of Mexico.

Steve Gittings, chief scientist with the Office of National Marine Sanctuaries, reported this week that federal scientists are studying a large-scale mortality event of unknown cause taking place at the East Flower Garden Bank in Gulf of Mexico.

The reef is part of the Flower Garden Banks National Marine Sanctuary, about 100 miles off the coasts of Louisiana and Texas.

http://www.nola.com/environment/index.ssf/2016/07/noaa_mass_die-off_at_marine_sa.html 

Hat tip to Colorado Bob at Robertscribbler (Tampa 2090 Hurricane post).

CNN Correspondent Calls Trump a BS Artist.

And Donald Trump has declared a Twitter war on CNN.

Hey, what else can I say?

Click here.

Suppose Consumption of Fossil Fuels Were to Peak in 2030

Even though, so far, they appear to be peaking due to the levelling off of demand, due to the ramp-up of renewables and because of affordability and financial reasons, like too high a debt load.

Source: Sam Caranas, Arctic News.

But if the did, a certain Grebulocities figured out a possible end point for atmospheric carbon content and posted it a a response to the post "Dark Ages America: Climate" at The Archdruid Report blog, in which the archdruid, John Michael Greer, suggested that fossil fuel emissions might peak in 2030 -- this was on July 30, 2014 mind you:

Now if only I could somehow find a time machine or a longevity potion and see if you're right... 

I just made a crude spreadsheet in Excel to see what type of CO2 concentration we might peak at under the assumption that the rate of change of the CO2 concentration peaks around 2030, falling to 0 by 2100. Under my model, the CO2 concentration rises by 0.55% this year (roughly equal to its average growth rate over the last decade) and the growth rate increases by 0.01% per year from now until 2029 (at 0.7%/year), then falls by 0.01%/year until it bottoms out at 0 by 2099. 

The peak concentration under these assumptions is "only" 562 ppm, obviously reached in 2099, conveniently about double the preindustrial level where temperatures were 0.8 C cooler than present. If the mean of most model estimates of equilibrium climate sensitivity is correct, we see about 3 C/doubling. So under these really crude assumptions, we've got a world 2.2 C warmer than present. Of course the error bars are huge, and they're larger on the warmer side. But if this is roughly where we end up, we're in the mid-Pliocene warm period at about 3.3 Ma, or perhaps a little worse. This is inconvenient because sea levels were 25 m higher than present, with no West Antarctic ice sheet and little or no Greenland ice sheet, but the East Antarctic ice sheet still existed and contained most of its current mass.

Well the CO₂ did rise by about 2.25 ppm on average from 2014 through 2015.by about 0.57% which is roughly on target with his prediction of 0.55%. But from 2015 through 2016? Well we don't have the minimum yet, but the CO₂ rise according to the graph maxima was about 3.5 ppm or about 0.88% according to the 2015 average content. And that's not even accounting for the fact that CO₂ content for 2016 finally peaked out at around 408 ppm in April - May, shown below.

Annual CO₂ pulse on Keeler Curve through July 2016.
Source: Mauna Loa Observatory, NOAA.

It appears that the 3.5 ppm rise is now being maintained. Although we're just coming off an El Niño, it's possible, especially when compared to the graph at the top, that we are having increased positive feedbacks or less negative feedbacks or both from natural sources, because it appears we did not have a nearly as big a Carbon Dioxide increase the last time we had an El Niño as strong as the one we've just had, i.e., the one in 1997-1998.

So will the atmosphere's Carbon Dioxide content be as little as 560 ppm? Don't know. But given the present rate of fossil fuels burning through 2030 and a new normal of 3.5 ppm for annual Carbon Dioxide content increase, we could be looking at 450 ppm or so around 2030, which makes the terminal content that much larger. Robertscribbler reports that under Business as Usual (IPCC's RCP 8.5) it could be as high as 936 ppm with a average planetary temperature increase at that time of around 4 to 5 degrees Celsius (7 to 9 Fahrenheit). Will it actually get that bad? Don't know.

But I DO know that global warming is NOT a myth!

A Pence Presidency?

A Pence Administration also means that the neocons' Poking the Russian Bear will continue, even if it results in WW3 and the lobbing of nukes.

Mike Pence in Bed with the Neocons.

Now the rumor mill has it that Trump is also in bed with the Russian banks, to the tune of $100 million or more. This must give Putin headaches, because the saying goes, if you owe someone $1,000 you can't pay, have a problem. But if you owe someone a $1,000,000,000 you can't pay THEY have a problem.

Now what will Putin do, when Trump tells the Russian banks to go screw? He can't send any of "his" (according to Newsweek) Russian mafia assassins to take Trump out. And he can't exactly escalate the Ukranian proxy war to full-blown war in Eastern (Central) Europe without breaking the NATO tripwire.

And the lobbing of all those nukes both sides own would create a twenty years' ice age (i.e., the nuclear winter).

"Retrotopia 2065" Finished Copy

This is the finished copy of the "Retrotopia ca 2065" map. Retrotopia is John Michael Greer's utopia for North America after an imagined civil war breaks out in 2029. (Well one might in actual life!)

Changes from the draft:

- Yukon and MacKenzie Deltas restored -- differential sea level change indicates that the sea level up on the Alaska and Yukon western and northern shores may stay the same or drop slightly due to the proximity to Greenland.

- Colorado area changed to match Maw Kernewek's map.

- West Virginia area - same.

- Missouri area - same.

- All the measles were taken off. (Tip to readers: never, never, never save as a GIF after working on one in MS Paint. Save it as a BMP or PNG instead.)

That is all.

Peak Oil (Demand) Front Update.

In a previous post on this subject, I posted a graph that indicated global oil demand will reach a new peak at the end of 2016, as well as supply. But now the blog Zero Hedge and the mainstream medium Bloomberg indicate that oil demand at least in the USA will drop this September and won't fully recover its summer peak.

First, from the credible mainstream source.

USA Oil Demand of previous years a good guideline to predict same for the remainder of 2016
Source: EIA via Bloomberg.

Oil Bulls Headed Over Demand Cliff as Refinery Shutdowns Loom - Bloomberg.

Beware, oil bulls: Just as U.S. oil production sinks low enough to drain supplies, demand is about to fall off a cliff. American gasoline consumption typically ebbs in August and September as vacationers return home, and refiners use that dip to shut for seasonal maintenance. Over the past five years, refiners’ thirst for oil has dropped an average of 1.2 million barrels a day from July to October. “People are looking ahead to the fall and are worried,” said Michael Lynch, president of Strategic Energy & Economic Research. “There’s more and more talk of prices going south of $40 and as a result people are going short.” Money managers added the most bets in a year on falling WTI crude prices during the week ended July 19, according to Commodity Futures Trading Commission data. 

That pulled their net-long position to the lowest since March. WTI dropped 4.6% to $44.65 a barrel in the report week and traded at $44.14 at 11:53 a.m. Singapore time on Monday. With weekly Energy Information Administration data showing U.S. gasoline stockpiles at the highest seasonal level since at least 1990, refiners may shut sooner and for longer ahead of the Labor Day holiday in early September, the end of the driving season. “With gasoline supplies the highest since April, refiners may pull some projects forward,” said Tim Evans at Citi Futures Perspective. “This will take more support away the market and add to the broader problem of excess supply.

There's a video at the same Bloomberg article which shows that Oil Hovers Near Two-Month Lows on Weight of Fundamentals. For more, click here.

Now the blog.

Peak Oil 'Demand' & The Duelling Narratives Of Energy Inventories - Tyler Durden, Zero Hedge.

Crude oil inventories in the U.S. have fallen 23.9 million barrels since the end of April, but, as Bloomberg notes, oil bulls counting on further declines are fighting history. Over the past five years refiners’ crude demand has fallen an average of 1.2 million barrels a day from the peak in July to the low in October. “The rough part will be once refineries start going into maintenance,” said Rob Haworth, a senior investment strategist in Seattle at U.S. Bank Wealth Management. “We aren’t drawing down inventories very fast and the pressure on prices will increase.

For more, click here.

You see, both are in agreement about what is going to happen to oil demand this autumn -- since the kids will be going back to school and the adults, back to work. No more driving all over the countryside while on vacation.

And the latest? The supports just got kicked out of the oil price. Again. Down to $42.00 a barrel for West Texas Intermediate Crude today. How low will the price go? And will Wall Street and other financial and venture capital concerns lend more money to improve technology to get even more oil out once the price stabilizes and starts to increase if and when demand outstrips supply again?

And will global demand reach a new peak in 2017? That's a big question since a lot of people are talking up a new recession coming soon, later this year or in 2017. For more info on the economic front, The Automatic Earth is a good source aggregator.

Hat tip to Raúl Ilargi Meijer of The Automatic Earth.

"Retrotopia 2065" Second Draft of the Map.

Here's the second draft of the map I posted yesterday.

Other commenters remarked on Mr. Greer's big batch of tips he addressed to me and in turn, Mr. Greer came out with some more tips:

Ed-M, the Atlantic Republic is the present-day states of New York, Pennsylvania, New Jersey, Delaware, and Maryland, with the eastern (not western) panhandle of West Virginia; Washington DC is technically Atlantic territory but it's basically a ruin inhabited by squatters. West Canada is BC, Alberta, Saskatchewan, the Northwest Territories and the Yukon Territory; Nunavut, I should have said, is an independent nation, having united with Kalaallit Nunaat (aka Greenland) in 2042. There's also the Free City of Chicago, which is an independent (and gaudily corrupt) nation, and consists of Cook County. I think that's it!

So I made some changes, but I kept the 2 degrees' Centigrade seal level rise for the East and Gulf Coasts, because the author of the Dredd Blogg has indicated that these coasts will get the worst of the sea-level rises. For example, Miami-Dade and Fort Lauderdale have a solid foot of risen sea level compared with the global eight inches since 1870, today!. Therefore for a global six feet, expect between ten and twenty feet sea level rise for the two shorelines.

For proof, click on the Dredd Blog tag and you'll be directed to his Post Series page. Scroll down to EXTINCTION (Yes, it is real) and then to various series on SEA LEVEL CHANGE. You'll find many posts under these topics that show that sea-level rise from global warming is not uniform, but varies all over the planet -- another component of global weirding.  For example, one post in particular discusses past and future sea level rise around Miami (click here).

"Retrotopia 2065"

Over at The Archdruid Report, John Michael Greer has been writing a series called "Retrotopia." The first chapter was posted about November of last year and the series has had about its twentieth chapter posted. So I thought I'd make a little map of North America at about that time.  Mr. Greer gave me the following pointers:

Ed-M, the map's pretty simple. The Republic of New England and the Maritimes consists of the New England states from Massachusetts north, and the Maritime provinces that are now part of Canada. Quebec is Quebec. East Canada is Ontario, Manitoba, and points north. The Lakeland Republic is Ohio, West Virginia except for the western panhandle, Indiana, Kentucky, Illinois, Michigan, and Wisconsin. The Confederate States of America is the old Confederacy of 1861 minus Texas, and plus the southeastern quarter or so of Missouri. The Missouri Republic is the rest of Missouri, Kansas, Nebraska, Iowa, Minnesota, and the Dakotas, along with all of Wyoming and Montana east of the Continental Divide and the northeastern third or so of Colorado. The Republic of Texas is Texas, Oklahoma, New Mexico, and part of southern Colorado. The Republic of Deseret is Utah, Idaho minus the panhandle, and the portions of Colorado and Wyoming west of the continental divide. Arizona and Nevada are abandoned territory, uninhabitable due to climate change. The Republic of California is California, and the Cascade Republic is Washington, Oregon, the Idaho panhandle, and the portion of Montana west of the continental divide. Oh, and there's the Kingdom of Hawai'i and the Republic of Alaska, if you want to include them. Sea level has gone up about six feet; New Orleans, Galveston, and the Florida Keys no longer exist, and the southern end of Florida has been heavily eroded by rising seas and massive hurricanes, so it's not the same shape as it is today. Got it? 

And so with that information, I created a map.

I got the Atlantic/Florida/Gulf Coasts drownings from this photo here. I went by that photo's 2 degree Celsius projected sea level rise which looks about right but I think is a gross underestimate for a 2 deg C tempreature rise. And at the current Carbon Dioxide Levels? It's going to be worse: higher temps and higher sea level rise.

I also tweaked SF Bay, the Puget Sound and Vancouver BC area, the Cook Inlet (Anchorage AK), the Yukon Delta and the MacKensie Delta to account for a 6-foot rise. Of course, the water that far up North might not rise being it's so close to Greenland and all.

Peak Oil Now or Else! Says the Earth.

From Flassbeck Economics on the ability of the IPCC, governments and scientists' worst case scenarios to keep up with what's actually happening:

The reality of Anthropogenic Climate Disruption (ACD) continues to outstrip our ability to model worst-case scenarios, as it is happening so much faster than ever anticipated.Sixty-three percent of all human-generated carbon emissions have been produced in the last 25 years and science shows that there is a 40-year time lag between global emissions and climate impacts. This means that we have not even started to experience the consequences of our growing emissions (see here). In the meantime, nothing substantial, nothing efficient is happening to curb CO2 emissions.

For example:

• Late 2007:The Intergovernmental Panel on Climate Change (IPCC) announcesthat the planet will see a one degree Celsius temperature increase due to climate change by 2100.
• Late 2008: The Hadley Centre for Meteorological Research predicts a 2C increase by 2100.

We've already blown through the 1.0 degree Celsius (1.8 Fahrenheit) increase from 1880s levels, we'll see a 2 degree Celsius (3.6 Fahrenheit) increase before too long. 2025?

The further predictions are dire and portrays scenarios which are extremely bad.

To avoid them we have to get off of fossil fuels as soon as possible and start sequestering carbon as soon as possible too. But that essentially requires a change in the corporate-driven capitalist system and a change of heart in humanity in general, in the American people in particular. Will the latter occur as it needs to? Morris Berman says it ain't gonna happen.

On the Peak Oil (Demand) Front...

Peak Oil demand is spreading more pain and gloom throughout the Oil Patch of the global economy.

The following two articles were posted by Raúl Ilargi Meijer on The Automatic Earth yesterday and today.

The first one:  More Pain Seen For US Crude As Product Glut Adds To Gloom (Reuters)

A glut of refined products has worsened the already-grim outlook for U.S. crude oil for the rest of the year and the first half of 2017, traders warned this week, as the spread between near-term and future delivery prices reached its widest in five months. A stubborn, massive supply overhang punished crude over the winter as U.S. oil futures hit 12-year lows in February. As supply outages and production cuts increased, crude rallied and spreads tightened significantly in May. But the unusually large amount of gasoline and oil in storage, combined with expectations of a ramp-up in crude production, has made traders more bearish on the price outlook for late 2016 and early 2017.

The second one: Fracklog in Biggest US Oil Field May All But Disappear (Bloomberg)

The number of dormant crude and natural gas wells in the U.S. stopped growing in the first quarter – and may all but disappear in the nation’s biggest oil field should prices hold steady. As of April 1, there were 4,230 wells left idle after being drilled, a figure little changed from January, according to an analysis by Bloomberg Intelligence. While some explorers have continued to grow their fracklog of drilled but not yet hydraulically fractured wells, others began tapping them in February as oil prices rose, the report showed.

Crude in the $40- to $50-a-barrel range may wipe out most of the fracklog in Texas’s Permian Basin and as much as 70% of the inventory in its Eagle Ford play by the end of 2017, according to Bloomberg Intelligence analyst Andrew Cosgrove. While bringing them online is the cheapest way of taking advantage of higher prices, the wave of new supply also threatens to kill the fragile recovery that oil and gas markets have seen so far this year. “We think that by the end of the third quarter, beginning of the fourth quarter, the bullish catalyst of falling U.S. production will be all but gone,” Cosgrove said in an interview Thursday. “You’ll start to see U.S. production flat lining.”

"Higher oil prices," that is, in the $40 to $50 range, can entice the extractors to return to pump out or frack out the wells that are dormant, or just drilled and capped. Unfortunately, according to the above Reuters article, and oil price developments today, those higher prices cannot be guaranteed. As Raúl Meijer says, What’s going to happen to the lenders who made it all possible?

Now the latest from The Wall Street Journal:

Oil prices fell Friday as a glut in oil products stoked market concerns that the global crude market will remain oversupplied longer than expected. 

U.S. crude oil for September delivery recently fell 54 cents, or 1.2%, to $44.21 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell 58 cents, or 1.3%, to $45.62 a barrel on ICE Futures Europe.

This simple chart explains why oil prices are so low compared to those in 2014.
Source: vox.com.

Demand is not keeping up with supply, despite an amount lower than the peak extracted in July of 2015. A NEW oil production peak, projected for the end of 2016, is not expected to outstrip demand. Which means there will be an even BIGGER glut and a backup in oil supplies being delivered because consumption by the end user is not fast enough. And storing all that oil has got to cost a lot of money.

Now what's the cause of this new oil peak? It is certainly not demand. But the lenders have to be paid, the social welfare systems of the producer countries have to be supported, companies' employee payrolls have to be met (otherwise employees get laid off), and some amount has to be set aside or spent for maintenance, exploration, drilling of new wells, and overhead, especially if lenders become loath to lend any more money to the fossil fuels industry.

Eventually the oil producers and oil producing companies will have to wise up, and reduce the supply to clear out the glut and backup of oil, in order to get the prices to go back up to a level where they can make a profit, "hopefully" at a price the end consumer can afford*.

* "Hopefully" at a price the consumer can afford: this would be good for the economy, which always has to grow to keep people employed and governments to meet its obligations and lenders to be repaid, but it would be TERRIBLE for the biosphere, us and our civilization, all of which depend on a salubrious climate that doesn't change more rapidly than species and ecosystems can adapt. Burning of more fossil fuels means more Carbon Dioxide in the air which means more and faster Global Weirding... with the coming superstorms the size of continents and the strength of hurricanes coming sooner and more frequently. One already happened last winter.

World War Three Dead Ahead!

It will come either by Hillary's neocons going Russian Bear-baiting; or, if Trump gets elected, the neo-cons in the GOP establishment going bear-baiting, or Putin thinking Trump is now treating NATO like some sort of protection racket and thereby taking back the former Soviet Republics of Estonia, Latvia and Lithuania. Maybe Finland, too.

Donald Trump just made imbecilic statements that if certain NATO countries in Europe haven't paid enough money in his estimation to the United States for their collective defense, then he'll just sit right back and let the Russians roll right over them, should Russia follow through on a decision to invade certain NATO countries.

Now our parents and grandparents knew of a certain British Prime Minister who flew to Munich and returned with a pact between the UK and Hitler, proclaiming "Peace in out time!" Soon enough, Hitler took over Czechoslovakia and the following September, invaded Poland.

To thread the needle of avoiding World War 3, if that's even possible, the United States needs to STOP poking the Russian Bear, i.e., get out of the Ukraine, and at the same time reaffirm its treaty obligation or promise as a lead pipe guarantee that it will defend the European NATO countries against a Russian attack. That means, of course, that we need to redirect our War Department dollars (622 billion of them) so as to spend them wisely, and not waste them on boondoggles such as the F-35 Lardbucket: no way is that thing going to compete with Russia's new Sukhoi fighter jets.

But most importantly, we should be waging peace at the same time we keep our committments and keep strong enough to keep them, in order to maintain the peace.

Demand-Side Peak Oil is Here -- Supply-Side Peak Oil to follow.

Major source for today's blog article: The Peak Oil Paradox -Revisited-, posted 19 July 2016 on The Automatic Earth by Raúl Ilargi Meijer.

So far, supply-side Peak Oil is a myth... so far. Although, prior to the hydrofracturing boom, it wasn't for the United States.

M. King Hubbert's Peak Oil predictions based on reserves.
Source: M. King Hubbert via The Automatic Earth.

In 1956, M. King Hubbert generated the above graph indicating Peak US Oil about 1965 for ultimate reserves of 150 billion barrels of oil, 1970 for 200 billion barrels.

Actual US Oil Production 1900 through 2015.
Enter fracking, and mutatis mutandis, no more Peak US Oil!
Source: The Automatic Earth.

I'll give you a short history behind the end of US Peak Oil, or rather, US "Twin Peaks" Oil. Right now in 2016 the US is pumping slightly less oil out of the ground due to the end of the fracking boom. The boom itself got underway by inflated estimates of the amount of oil in the Bakken Shale formation and elsewhere. Htdrofracturing was a perceived profit center. A lot of debt was issued to get the new method of oil and natural gas extraction underway. And for a short while, it was, at least for oil, so ling as fossil fuel prices remained relatively high ($100 to 110 per barrel 2011 up to mid 2014). But then the oil prices started to collapse!

Oil price History 1974 through 2014.
Source: The Huffington Post.

Oil prices have gone on a roller coaster depending on supply, demand, political intervention and speculation. However, since the end of 2014, oil prices have remained relatively low.

Oil Price History 2006 through end 2015.
Source: The Motley Fool.

The Motley Fool article asked if another price spike was underway, and indeed a small one did come about, and hit about $60 or so per barrel, but quickly collapsed when China cracked down on commodities speculation. It's now about $45 per barrel. Where the oil price goes now depends on how big the continuing supply is, and how strong or weak the demand is. Whether the oil industry can make a profit on the price is a different story.

The oil extractors at least in the United States and Canada have managed to get their costs down, at the expense of future investment, but some, especially small-time frackers, are pumping as much as they cam just to meet service payments on their debt! Oil-producing countries, on the other hand, have social welfare safety nets to take care of, which hikes their break-even oil price requirements considerably. Of course, some like Russia are somewhat lucky, because their internal costs are in the local currency, and shrink in relation to the world price which is in US Dollars, due to drop in the currency for whatever reasons (in the case of Russia, US sanctions causing reduced trade with Europe). Even so, some companies have gone under, other companies have shut their wells, and the daily production has dropped as a result.

Latest peak production was in July 2015. Production has been shrinking by 2% per year since.
Source: The Automatic Earth.

Now it may be that the price of oil may go back up again, if the demand trend line shown above continues. If it spikes back up far enough, the financial sector, now reeling from default by the "oil patch" companies (but not as bad as it did from the bursting of the housing bubble), may choose to invest in oil extraction and the development of oil extraction technologies again. On the other hand, they may not, and in which case a rise in production may not occur until there are lines at the gas stations. And if there has been a considerable amount of disinvestment in and neglect of the oil extraction infrastructure, the daily production rates may never see the peak attained in 2015 ever again! But then again, it might, or even exceed it. At any rate, we could be in for several cycles of price collapse, financial fallout, production drop, shortage, price spike, reinvestment, production rise, glut, and price collapse, rinse and repeat, until the physically and economically feasible oil extraction drops remorselessly.  Natural gas extraction and coal mining may accordingly drop along with it.  

In which case... voila! Supply-side peak oil becomes a reality, thanks to demand-side peak oil attained in mid-2015.

Here are Raúl Meijer's concluding thoughts (read the article) on the matter, which I believe is similar with my thoughts above on the future of fossil fuels' extraction.

1. M. King Hubbert’s forecast for US oil production and the methodology it was based on has been proven to be sound when applied to conventional oil pools in the USA. When decline takes hold in any basin or province, it is extremely difficult to reverse even with a period of sustained high price and the best seismic imaging and drilling technology in the world.
2. On this basis we can surmise that global conventional oil production will peak one day with unpredictable consequences for the global economy and humanity. It is just possible that the near term peak in production of 97.08 Mbpd in July 2015 may turn out to be the all-time high.
3. Economists who argued that scarcity would lead to higher price that in turn would lead to higher drilling activity and innovation have also been proven to be correct. Much will depend upon Man’s ability to continue to innovate and to reduce the cost of drilling for LTO in order to turn a profit at today’s price levels. If the shale industry is unable to turn a profit then it will surely perish without State intervention in the market.
4. But from 2008 to 2015, oil production actually fell in 27 of 54 countries despite record high price. Thus, while peak oil critics have been proven right in North America they have been proven wrong in half of the World’s producing countries.
5. Should the shale industry perish, then it becomes highly likely that Mankind will face severe liquid fuel shortages in the years ahead. The future will then depend upon substitution and our ability to innovate within other areas of the energy sector.

And I will add: what sorts of innovation? Wind, hydro, solar, nuclear if it weren't so dodgy, and biofuels if they didn't take food out of the mouths of the poor.

Besides, we have a soon-approaching abrupt and civilization-wrecking climate change coming up.

Totalitarian America - an Inagined Scenario.

I copied this from Srauss and Howe's The Fourth Turning Forums website, which I believe is now extinct. I proofread it and made corrections, and elaborated on it by adding the last paragraph. Basically it's a totalitarian dystopia based on a possible Ayn-Randian and Christian hard right gaining complete dominance and control in the United States -- which could be enabled by Donald Trump winning the White House.

I can see this 4T, in one of my worst nightmares, as the questionable procession from control by the Boom Right to Mafia-like enforcers of Generation X who so bungle things that the Millennial Generation uses its collectivist tendencies to turn against heirs of wealth that have become an aristocracy in all but name, religious hucksters who fool people, and gangland enforcers (which could be Bloods, Crips, and MS-13) in a violent proletarian revolution. 

The other is that America under a Hard Right regime becomes an anathema -- much like North Korea or Iran today, Iraq under Saddam Hussein, or South Africa under Apartheid, if for very different reasons, with its unique view of how to organize an economy and an anti-democratic political system. Paradoxically, the nastiest systems often have a missionary desire to spread the ideology where it is unwelcome through local chicanery or outright force, and as a result a tendency to take undue risks of international war. Just imagine what a theocratic-plutocratic America would be like to the rest of the world. 

Think of all the escaped dissidents who would end up in places like Paris, Tokyo, Moscow, Tel Aviv, New Delhi, Karachi, and Beijing.  

"I could no longer practice medicine in the United States after I refused to become a member of the (name favored church in the Christian and Corporate State)", says Mohamed S in Ankara.  

"I lost my teaching permit when the police found a copy of Das Kapital, and was fired from the University of California at Berkeley", says Dr. Linda T in Berlin. "I had been using it for material often critical of communism and the old Soviet Union, but all that the regime saw me useful for was to mine coal in Kentucky. At age 52, I know how long I would last in a coal mine, especially on short rations, but survival of people like me is no priority." 

"I lost my congressional seat in what used to be a safe seat in the Chicago area after the Constitution was amended to allow employers control of workers' votes. You know -- vote wrong, lose your job, but go to a labor camp. I got some knocks on the door at 2AM, my dog was poisoned, and I got warnings to leave while I could before I ended up like my beloved and late dog, and as a black man I felt that I would feel more comfortable in Recife" says former Congressman W. "Protect your civil liberties here in Brazil while you still can!" 

"I have returned to Mexico because work in America no longer pays enough to live on. I never expected to do so, but I didn't want my kids to have to drop out of school and become domestic servants despite doing well in school. The stuff about 'Land of the Free' has become a farce. I say this in English because I want the thugs who now rule America to hear this in the language that they know", says Maria Z., born and raised in Denver like her children, in Guadalajara. "A Mexican worker may be poor, but not as poor as an American worker who has chains instead of pay!" 

"As an exchange student from Boston (my family is still fairly comfortable, but maybe not for long -- we are Jews) attending the University of Krakow I was at first not so comfortable about being so close to a site of extreme infamy [Auschwitz] where some of my relatives perished... but I now feel safer in Poland than in Massachusetts, especially after I hear of the labor camp built in Worcester. I know that if I did complete my education at Harvard I would be heavily in debt and would have to make some abominable choices just to avoid going broke. I wish to renounce my US citizenship and begin the process of becoming a citizen of Poland", writes Sarah G. on her application for political asylum. 

"I escaped the United States when I was a teenager and am now a Russian citizen. As a gay man living in Saint Petersburg, I know full well that Russia still has on its books a law against 'homosexual propaganda' in the presence of minors. Still, I came here from Dallas because the law is not enforced very often or harshly these days as it used to be. Even if it were, people still don't hunt you down like an animal and kill you on the very spot they find you, like they do in America," says Peter T. on Russia Today. 

Clouds Tracking Further North Just as Predicted by the 'Warmists'.

Thanks to the Fossil Fuels Derivatives Beast.

The Fossil Fuels Derivatives Beast.

Yes, I'm using the Denialists' term for climate scientists and others concerned about global warming.  It ought to get the Denialists' goat to be proven wrong!  See below.

Now from the Washington Post, a new analysis of satellite photo records shows that over the past four decades, since 1983 in fact, the cloud and storm tracks have been adjusting their positions poleward.

‘The most singular of all the things that we have found': Clouds study alarms scientists

Chris Mooney - The Washington Post - 14 July 2016.

[A]ccording to leading climate scientist Veerabhadran Ramanathan — credited with discovering that chlorofluorocarbons, or CFCs, are actually a greenhouse gas, among other major findings — a new study this week showing that clouds already are shifting their distributions across the Earth, and in a way predicted by climate change models, stands out. And not in a good way. 

The study was led by Ramanathan’s Scripps Institution of Oceanography colleague Joel Norris, though Ramanathan said he was not involved in the work and didn’t know about it until shortly before publication. But Ramanathan said that the study basically confirms that there’s nothing to prevent the world from reaching the high levels of warming that have long been feared — except for our own swift policy actions, that is. 

“My reaction was, my goodness,” Ramanathan said. “Maybe the 4 to 5 degree warming, certainly we were all wishing there was some certainty that would make it go away. So I consider the findings of this paper, the data shows major reorganization of the cloud system.” 

This matters because clouds are fundamental regulators of how much solar radiation makes it to the Earth’s surface (rather than being reflected back to space by white cloud tops), and how much infrared or “longwave” radiation escapes back to space once again.

For more information, click here, here and here.

But you know, what really grinds my gears is that people are still saying that "our own swift policy actions" can "prevent the world from reaching the high levels of warming that have long been feared." How are we going to do that? According to Robertscribbler, "Current greenhouse gas levels — topping out near 408 parts per million CO2 (and 490 parts per million CO2e) this year — will need to fall in order to prevent 1-3 C of additional warming." We're approaching 2 degrees C above 1880s levels already -- and although the planet's temperature will probably retreat to give us a 1.2 deg C avearge for all twelve months this year -- Ramanathan is right that current CO2 / CO2e levels are going to ramp warming up to the 4-5 deg. C mark.  We'll need to reduce the CO2 / CO2e levels. How are we going to avert that? Plant lots of trees even as multiple demands are causing deforestation all over the planet?

We need clean fuels to replace fossil fuels now and wind and solar may not be enough. How are we going to do that?  It seems right now, despite their ongoing financial troubles (which may cause fossil fuel production to remorselessly decline by way of disinvestment over the next several years), the fossil fuel industries and their bought (mainly "conservative") politicians are in the catbird seat right now, driving our fossil fuel dependency and this whole climate mess!

HERE'S Why People Support Donald Trump.

Not because of racism. But because neoliberal economics, corporate greed and neoconservative foreign policy threaten to put them and their kids into a permanent underclass, dependent on welfare and strung out on illicit drugs.

The The Guardian - Millions of Ordinary Americans Support Donald Trump. Here's Why by Frank Rich.

Impact of Sea Level Rise in Boston Worse than Previously Thought.

Again, it's all on the ice-melt in Antarctica and the release of water due to the reduced gravity of the shrunken Antarctic ice cap. The Law of Gravity works on objects on and orbitng Earth and every other planet, tides, solar systems, galaxies, and even water around ice caps and hoards of wealth!

From The Boston Globe:

The consequences of climate change on Boston are expected to be far more calamitous than previous studies have suggested, a new report commissioned by the city says. 

In the worst-case scenario, sea levels could rise more than 10 feet by the end of the century — nearly twice what was previously predicted — plunging about 30 percent of Boston under water. Temperatures in 2070 could exceed 90 degrees for 90 days a year, compared with an average of 11 days now.

The report, by scientists from the University of Massachusetts and other local universities, has raised concerns in City Hall just two weeks after Mayor Martin J. Walsh attended a climate summit in Beijing.

The updated projections for Boston take into account new research that suggests the accelerating melt of the ice sheets covering Antarctica will have a disproportionate impact on cities along the East Coast.

http://www.bostonglobe.com/metro/2016/06/22/climate-change-could-have-even-worse-impact-boston-than-previously-expected/S6hZ4nDPeUWNyTsx6ZckuL/story.html?event=event25

For more information:

Dredd.Blog: Greenland and Antarctica Invade the United States

Ecocosmology: The Gravity of Sea Level Change

Dredd Blog: Why Sea Level Rise May Be the Greatest Threat to Civilization

The First and Second Laws of Capitalism and the "Free Market".

I found on page 406 of Kevin Phillips' book, Wealth and Democracy, a quote from James B. Weaver, a hero of the "War of Northern Aggression," a Greenbacker (backer of fiat money during said war) and a Populist candidate for President of the United States, a quote he said in 1880 about wealth, which revealed his belief in "natural and benificent laws" that would cause wealth to diffuse itself amongst the masses. Nothing can be further from the truth. There are two principal laws of capitalism and the "free market" which operate in every era, and in every country, unless the market is regulated by government.

The First Law of Capitalism (Gresham's Law): bad money drives out good. Just compare the popular entertainments of the 1950s and 1960s to those of 1980s and those of the present day. You'll see this law has been hard at work.

The Second Law of Capitalism (Orlov's Law) a.k.a., Moneybags Logic or The Law of Gravity of Wealth: the wealth of any country naturally attracts to and accumulates itself into vast concentrations favoring the few owning them, at the expense of the many. This is epitomised by the moral of the Parable of the Talents in Matthew 25 and Luke 19: "To those who hath, more will be given, and he will have it in abundance; but to those who hath not, even that which he hath will be taken away from him."

May is the 8th consecutive hottest month EVAH!

At least since before the records have been kept, and probably since the Eemian period a hundred-ten-thousand years ago.

Anyway, here's the latest from Robertscribbler with tips o' th' hat to: Ryan in New England, June, and dtlange.

May Marks 8th Consecutive Record Hot Month in NASA’s Global Temperature Measure

Image source: NASA GISS.

May of 2016 was the warmest May since record keeping began for NASA 137 years ago. 

It is now the 8th record hot month in row. In other words, since October, every month has been the hottest such month ever recorded (October vs October comparison, November vs November etc). And May’s record is just the most recent high mark during a period that has now vastly exceeded all previous measures for global temperature tracking. 

The month itself was 0.93 C above NASA’s 1951-1980 baseline measure. It’s the first month since October that readings fell below the 1 C anomaly mark. A range that before 2015 had never before been breached in the 136 year climate record and likely during all of the approximate 12,000 year period that marks the Holocene geological epoch. 

It’s a reading that is fully 1.15 C above 1880s averages.  

A 1.2 C annual 2016 departure is firmly within the range of estimates for global temperatures that occurred within the Eemian climate period around 115,000 years ago. At that time, global ocean levels were between 16 and 25 feet higher than they are today. And if such warm temperatures continue for any significant duration, we could expect oceans to at least rise by as much (especially considering the fact that about 15-20 feet worth of sea level rise is locked into the ice of glaciers that are now in the process of heading into the global ocean).

 Image source: The Keeling Curve.

Atmospheric CO2 levels peaked at 407.7 parts per million in May as well. A jump of about 3.8 parts per million above peak readings during May of 2015.

If carbon dioxide levels were to remain so high we could expect global temperatures to, over the course of 300-500 years, hit near 3 C above 1880s levels and oceans to rise by as much as 60-120 feet. Adding in methane and other greenhouse gasses — current CO2 equivalent for all global heating gas estimates are now in the range of 490 parts per million. Enough to warm the Earth by about 4.6 C over hundreds of years and to, among other things, eventually raise oceans by 120 t0 200 feet.

For more click here.

Now speaking of destabilised glaciers and ice sheets, the Larsen 'C' Ice Shelf, right next door to the Larsen 'B' one which collapsed and shattered in 2004, is now in a more fragile and unstable state than previously thought.

From dtlange:

Antarctic Discovery Reveals Larsen C Ice Shelf Weakness 

Researchers report discovery of a massive subsurface ice layer, at least 16 km across, several kilometres long and tens of metres deep, located in an area of intense melting and intermittent ponding on the Larsen C Ice Shelf in Antarctica which may suggest the ice shelf is even more fragile than thought.

reportingclimatescience.com/2016/06/14/larsen-c

Well here's a bit of good news: Bloomberg New Energy Finance (BNEF) reports that that “coal and gas will begin their terminal decline in less than a decade.”

June links to the Bloomberg News article (peak fossil fuels for electricity by 2025); this from Ryan in New England:

Here is the core finding of BNEF’s “annual long-term view of how the world’s power markets will evolve in the future,” their New Energy Outlook (NEO): 

"Cheaper coal and cheaper gas will not derail the transformation and decarbonisation of the world’s power systems. By 2040, zero-emission energy sources will make up 60% of installed capacity. Wind and solar will account for 64% of the 8.6TW [1 Terawatt = 1,000 Gigawatts] of new power generating capacity added worldwide over the next 25 years, and for almost 60% of the $11.4 trillion invested." 

http://thinkprogress.org/climate/2016/06/13/3787700/coal-gas-plants-cheap-renewables/ 

And the reasons?

First, renewable energy benefits from manufacturing economies of scale. Second,  Fossil fuels are finite resources that are dependent upon extractive mining. Third, Cheaper coal, oil and gas, due to increased renewables and lower demand otherwise, means that less oil, coal and gas will be extracted: this means Peak Oil, Peak Coal and Peak Gas will be passed. Fourth, Once this begins to happen, the fossil fuel industry is put on death ground and will have to switch to renewables or squash them through political control. (Credit Robertscribbler)

But the caveat is that the manufacture and build-out of renewable energy infrastructure is dependent upon fossil fuels! Which means if there is a future shortage of fossil fuels, especially if Hillary or Trump gets us into World War 3, renewables may get the short end of the stick so that shorter-term needs are met instead.

Even with the Bloomberg forecast of 60% catchment of all electricity by zero-carbon energy sources by 2040 (a huge feat by itself if it happens) still runs bad risks from the perspective of climate change, because it implies we'll be stuck with 435 to 460 ppm CO2 and around 510 to 570 ppm CO2e by then.

And another thing we need to beware of: Wall Street is still investing in fossil fuels: they are betting that fossil fuels will continue to be extracted and consumed, perhaps even at the expense of zero-carbon sources.

From June:

World’s Banks Driving Climate Chaos with Hundreds of Billions in Extreme Energy Financing 

Wall Street continues to back the most polluting fossil fuel industries “at the expense of some of the most vulnerable communities on the planet,” states new report.
The report, $horting the Climate: Fossil Fuel Finance Report Card 2016 (pdf), put forth by Rainforest Action Network (RAN), BankTrack, Sierra Club, and Oil Change International, evaluates the private global banking industry based on its financing for fossil fuels… 

So big extreme fossil fuel investments are massive bets that governments won’t stop climate change. 

http://commondreams.org/news/2016/06/14/worlds-banks-driving-climate-chaos-hundreds-billions-extreme-energy-financing

Some of the big playaz are Citigroup, Bank of America, JP[irates]Morgan Chase, and Barclays. And our candidates, where do they stand? Let's see, now.... Donald Trump doesn't believe Global Warming is for real and promises to end all funding for climate monitoring by the US. Hillary, although she says a good line, is in the pockets of Wall Street, especially Goldman Sachs, and has considerable backing from Fossil Fuels interests. Which means she'll give lip service to combatting climate change but pursue "Drill, baby, drill!" policies once elected, just like Obama. Oh, great. So these two pose to threaten Near Term Extinction upon us not only by World War 3, but also the utter collapse of civilisation by Dangerous Climate Change - the Fossil Fuels Derivatives Beast. At least with the latter we won't go extinct! 

For more, click here.

Remember what I said yesterday about Donald Trump?

Yesterday I referenced the Vox.com article that stated that Donald is no dove. Today I have another article that essentially conforms the same thing, although it is a far less researched opinion piece in the American Conservative.  But the comments are worth clicking through and reading the article by Daniel Larison: No, Trump isn't an "Isolationist."

Larison contends that Donald Trump is not an isolationist, but a nationalist who would intervene solely in the interests of the United States and to Hell with everybody else. Even if the intervention is directly against Russia. Well Putin would have only one thing to say and do in such an intervention, and in a way would tell Trump, as Dimitri Orlov has described Russia saying to the West many times before, to go to Hell, and then make it stick. Making it stick, of course could be or could lead to an extinction level event. Or do you think Trump would just bend over and take it? (The same goes for Hillary and her neocons.)

Colin Dueck sees Trump this way, and for once I am in at least partial agreement with Dueck. Dueck writes:

His critics call him an isolationist, but that’s not quite right either. Genuine isolationists on both left and right, however wrong-headed, tend to be more high-minded, principled and pristine than The Donald. Trump’s real niche, carved out in his own strange way, is simply American nationalism.

.... 

Trump’s nationalism leads him on the one hand to eschew deeper involvement in Syria because the conflict has little or nothing to do with the U.S., but on the other it leads him to make ridiculous statements about seizing other nations’ resources and denouncing diplomatic agreements with other states. If we can pin down his foreign policy at all, it is aggressive and unilateralist when Trump thinks the U.S. has something to gain, and it is otherwise content to leave regional problems to regional actors. One reason that he isn’t an “isolationist” or anything close to it is that he claims to want to “make America great again,” and part and parcel of that supposed greatness is building up the military and “winning” contests with other states.

For more, click here, and don't forget to read the comments!

Remember, Peak Oil is here and gone in the US and is coming soon for the rest of the planet, and Russia's one country with a lot of unexploited oil and natural resources!