Cheap oil forever!
Grinch
wrote:
>
><ro...@telus.net> wrote in message news:40abbe59...@news.telus.net...
>
>>
>> The amount of oil that is ultimately recoverable is definitely finite,
>> but also very much larger than the amount that can be produced at
>> $40/bbl.
And in the future, the amount that will be able to produced at *under*
$40 (or $30, $20, etc.)/b will be very much more than can be produced
at corresponding and even higher prices today, obviously.
>> What is going to happen is that the price of oil will
>> continue to rise.
For exactly the same reason that increasing scarcity has steadily
driven up the cost of all other finite resources that have been
steadily consumed by humanity at an ever increasing rate.
As clear examples that we all know about there's coal, used in huge
amounts since well before oil ... well, um, no, forget that ... but
there's, um ... no ... um... something, right? Gotta be.
I mean, it's *extremely powerful logic*: A natural resource that is
finite in amount is consumed at an ever-increasing rate by humanity,
with the lowest cost supplies consumed first -- that commodity *must*
become more scarce and rise in price. QED. Res ipsa loquitur. Who
could argue?
The logic is every bit as compelling as that of the geocentric solar
system and flat earth.
Although admittedly the geocentric solar system agreed much better
with empirical observations of reality.
And for that matter the flat earth did too. After all, to the
ancients the earth looked flat as an empirical matter, and if a ship
sailed off and sank down below the horizon they might take that a
empirical support of the idea of falling off the edge.
Meanwhile, we're all still waiting for our first observation of a
mineral resource rising in price perpetually (much less running out)
due to scarcity as a result of humanity's consumption of it.
But as long as one ignores the total lack of all empirical evidence
needed to confirm it, the theory looks great!
>> When its price exceeds the price of equivalent
>> energy produced by other means, it will no longer pay to just burn it
>> for its energy content, and oil consumption will stop growing and
>> perhaps decline.
Indeed. Exactly as happened with whale oil in the 1850s and coal in
Britain at the turn of the last two centuries, **as experts had
predicted**!
Of course, what was wrong with those predictions was that the experts
had predicted it all was going to happen because of the whales beingl
killed off and Britain running out of coal bringing the Industrial
Revolution to a grinding halt. Coal was a finite resource being
consumed at an ever increasing rate with the cheapest supplies
consumed first, which irrefutably = ever-rising prices, you know.
Res ipsa loquitur. Who could argue?
(As long as one didn't look at facts.)
>
>Yep, I think that's pretty unarguable,
QED! And data free!!
<snip>
>..... The interesting questions concern the
>details:
What?? Somebody wants to get empirical?
>- *how high* will the price of oil go, and when?
>- what do the cost curves of other sources of energy look like? (ie, how
>expensive does oil have to get before nuclear/solar/wind/coal/etc power
>plants, electric cars, and bicycles start looking good?)
>- what happens to global energy use long term?
>- What does our society look like in the future as a result? How do 6b
>people keep running their tractors and eating?
Well, how about going about it by first putting together a bit of a
logical framework to be able to ask a question we really *can* answer,
instead of musing and pulling our chins and fantasizing.
Like:
Can we maintain supplies of oil at quantities we want at economically
healthy prices?
Clarification: How long does it matter? Well, 100 years was from
whale oil to nuclear power and jet planes, 120 years to a man on the
moon and SSTs.
100 to 120 years from now we could have fusion powering hydrogen
separation plants for clean CO2-free vehicles, photovoltaic houses,
power plants pulling energy out of the quantum foam ... that tall
alien might show up with gift e=mc2 matter-energy conversion kits for
every household and that book of his "How to Serve Man" .. who the
heck knows?
But if we can avoid problems for over 100 years that will be plenty of
time to adjust. If our descendants are too dim to take care of
themselves with that kind of lead time too bad for them. So let's say
100-120 years as a time frame.
Clarification: What are economically healthy prices? Well, we're
doing all right today. So let's say no higher than in our actual
experience.
Now, in our experience oil topped at $70/b in today's money in
1981. Since then the intensity of oil use per dollar of GDP has
dropped steadily.
After the 1981 peak came the "seven fat years" of the Reagan boom,
GDP growth averaged > 4% and oil averaged $55/b in today's money also
adjusting for its higher weight in GDP.
So we *know* we can have an extended boom with >4% growth at $55/b
because we've already had one.
Let's say healthy prices are no more than $55 to $70/b, tops (the
latter price considering how intensity of oil use is projected to
continue to decline in GDP in the future). Off the actual record,
that should be fine.
Clarification: How much oil do we want? Today the world is consuming
80m b/day. For ease of computation let's up it to 100m barrels.
Now we can restate the question with some specificity:
Can the world produce an average 100m barrels of oil a day for the
next 100 to 120 years at a price of no more than $55 to $70/b tops?
Now *this* is a question to which we might be able to give a
meaningful answer, by looking at facts.
Some facts to consider:
* By "oil" we mean "oil products", gasoline, etc, not goo pumped up
out of the ground -- just like in the 1840s "oil" meant lighting and
cooking fuel and lubricants, not dead whales.
* The full range of oil products can be, have been, and are now
produced from all the wide variety of hydrocarbons that exist in
*vast* amount on this planet -- sweet oil (Texas Tea and Saudi Light),
oil sands, tar sands, coal, natural gas, etc and so on.
Germany and South Africa have already run their economies on
oil-from-coal, and you probably are putting gasoline from oil sands in
your car right now. Have you noticed?
* The cost of producing oil products from these various sources
varies, but is profitable right now from the various sources with
their current market prices as inputs using today's technology at
final prices well below the $55 to $70 top we have set for ourselves.
Oil from oil sands is economic today at $15/b, from natural gas at
$20/b, from coal at $30/b, etc.
Production of oil from oil sands is very profitably commercial
now, e.g. 700k barrels a day in Alberta, and increasing.
Production of oil from natural gas, coal, etc, has been kept off
the market to date due to the Saudis' huge reserves of $2/b oil that
they can use to drive higher price sources off the market, and by the
OPEC cartel's overt policy of keeping oil under $30/b to prevent such
sources from being developed.
However, should the oil price ever *really* go up over $30 on a
sustained basis due to an actual growing supply shortage, there is
nothing at all preventing them from coming on line on really big scale
-- as the historical examples of Germany and South Africa attest.
* Normal advances in technology will of course lower the cost of
producing oil from these non-"sweet oil" alternative sources over
time. This is exactly how 177 billion barrels of proven reserves --
the largest in the world outside of Saudi Arabia -- just magically
appeared in Alberta, Canada.
Assume conservatively a 2% annual increase in production
productivity -- much less than the industry historical average --
and in 100 years cost drops by 87%. So today's $15 oil-sand oil drops
to a cost of $2/b, and the hard to get stuff in Alberta that would
cost $115/b today becomes available at $15/b. There's the same effect
with oil from natural gas, oil from coal, etc. E.g. today's $30
oil-from-coal drops to around $4/b, and oil-from-really-bad-last-dug
coal that would cost >$200/b today costs $30/b.
Productivity gains of 2% annually over 50 years drops cost by
two-thirds -- so we can estimate the average cost of today's $15/b oil
from oil sands at $5/b, and today's $30/b cost of oil from coal at
$10/b over our 100-year period..
OK, *now* we are ready to plug in some actual real-world numbers for
hydrocarbon supplies and see what we get.
For our favorite conventional old-fashioned sweet oil, the US
Geological Survey says there are 3 trillion barrels left and
available. At 100m/b a day that's 82 years.
As to oil sands, in just the one field in Alberta there's 1.6 trillion
barrels (six times the reserves in Saudi Arabia). If only half of it
gets produced that's another 22 years. Hey -- we're over 100 years
already! That's 104 years so far.
Let's be real conservative and forget all the other big oil sands
fields in the world. Let's forget natural gas, tar sands and most of
the rest of them too --- I like coal!
Coal has already been done by modern industrial economies twice.
Coal is used today mostly for electric power generation, which could
easily be switched to nuclear over the next 100 years if we had an
incentive to do so, like using coal for oil. There's *lots* of coal
without even looking for it. And the USA is the Saudi Arabia of coal.
Today, without even hardly looking for it, there's 210 years supply of
coal, 1.1 trillion tons. (How silly were those Brits to think the
Industrial Revolution was going to come to an end for lack of it, just
due to pure logic, eh?)
Let's subtract 120 years supply of coal to cover coal needs over that
time. That gives about 470 billion tons of extra coal, which produces
oil at 7b a ton or gasoline at 10b a ton. Let's use 7 barrels. OK,
that's another 3.3 trillion barrels of oil = another 90 years. We're
up to 194 years.
That's assuming we don't want any more coal via the nuclear option.
But heck, for fun let's do say we convert some of that coal to
gasoline directly to get 10b a ton, so we can get over 200 years!
Hey, we've made our 100-to-120 year target with 80-to-100 years to
spare as margin!
And we haven't even considered our second oil sands field yet -- we
know of other damn big ones out there, and we haven't even looked for
them yet. And we haven't considered any of the other hydrocarbon
sources.
So, *can* the world economy produce oil at 100m a barrel a day for the
next 100 to 120 years at a price not exceeding $55 to $70 a barrel in
today's money??
Damn right it can.
Will the oil price go up over $55 to $70 a barrel in that period?
I have no idea -- but if it does it sure won't be due to any scarcity
of oil stocks or of the technology to produce oil products from them
at that price level and much lower.
In economics the word "substitute" is quite significant.
But who knows, maybe Canada will join OPEC.
>Enjoy your SUVs and jets while ya got 'em, folks.
Few SUVs here in NYC and the Jets are looking like another losing
season. So no enjoyment in either case,
But if I was in Green Bay I'd enjoy both my SUV and football team
guilt-free.
*Here's* what I'm worried about:
One thing that's *really* going to expand exponentially way into the
future is computing. More and more silicon chips being produced and
put into everything, toasters, *everything*, as far as we can see.
But silicon exists in finite quantity. As consumption of it ever
expands and the cheapest stocks are used first, perpetually increasing
scarcity *must* result and drive its price *up* indefinitely.
The logic is irrefutable. QED. Res ipsa loquitur. Who could possibly
argue?
Sand, people, *sand*! We are going to be priced off the beaches!
The computing revolution will be brought to a grinding halt!
You've been warned!!!
>Darren
>
Robert J. Kolker
Grinch wrote:
> For exactly the same reason that increasing scarcity has steadily
> driven up the cost of all other finite resources that have been
> steadily consumed by humanity at an ever increasing rate.
Assume hypothetically that there is so much of the resource that at
current rates of consumption it won't run out for a thousand years.
Would the price be ever rising? I shold think the price would be
determined by the cost of extraction (that would be the floor) and the
demand for the product. Finiteness ipso facto does not imply an ever
increasing price.
Bob Kolker
Missaka Wijekoon
within a reasonable multiple of a human a lifespan?
-Misk
Matt Timmermans
"Robert J. Kolker" <robert...@hotmail.com> wrote in message
news:dQDyc.16687$eu.13258@attbi_s02...
> Assume hypothetically that there is so much of the resource that at
> current rates of consumption it won't run out for a thousand years.
> Would the price be ever rising? I shold think the price would be
> determined by the cost of extraction (that would be the floor) and the
> demand for the product. Finiteness ipso facto does not imply an ever
> increasing price.
Quite true. Even when there is little of the resource left, price is still
determined by the cost of extraction as long as there is competition.
Sometimes, the cost of extraction rises gradually as the resource becomes
scarce, but often in remains low until the resource is almost gone. Even
otherwise renewable resources, like species of animals, can be consumed into
extinction this way.
ro...@telus.net
wrote:
>On Thu, 20 May 2004 14:01:39 -0700, "Darren" <repl...@news.group>
>wrote:
>>
>><ro...@telus.net> wrote in message news:40abbe59...@news.telus.net...
>>
>>> What is going to happen is that the price of oil will
>>> continue to rise.
>
>For exactly the same reason that increasing scarcity has steadily
>driven up the cost of all other finite resources that have been
>steadily consumed by humanity at an ever increasing rate.
Not really. In the case of oil, a small fraction of the total
resource is under enough pressure that it can be extracted just by
drilling a hole and letting it flow. This extreme ease of extraction
meant that for over 100 years up until the early 1970s, real oil
prices fell pretty consistently as technology improved and reserves
that could be tapped in that way were discovered.
However, since the early 1970s, real oil prices have risen (as I said,
and you denied) in part because of geopolitical events but primarily
because the fraction of current oil supply that can be extracted at
such very low cost has been declining. Almost all oil extracted must
now be pumped, at some cost in energy. It is this energy cost of oil
that will be rising.
>I mean, it's *extremely powerful logic*: A natural resource that is
>finite in amount is consumed at an ever-increasing rate by humanity,
>with the lowest cost supplies consumed first -- that commodity *must*
>become more scarce and rise in price. QED. Res ipsa loquitur. Who
>could argue?
>
>The logic is every bit as compelling as that of the geocentric solar
>system and flat earth.
>
>Although admittedly the geocentric solar system agreed much better
>with empirical observations of reality.
What has happened to the real price of oil over the last 35 years,
Grinch? How about over the last 20 years?
>Meanwhile, we're all still waiting for our first observation of a
>mineral resource rising in price perpetually (much less running out)
>due to scarcity as a result of humanity's consumption of it.
Do you or do you not understand that the real price of oil fell until
about 1970, and has been rising since then? Don't you think 35 years
is enough to establish a trend?
>But as long as one ignores the total lack of all empirical evidence
>needed to confirm it, the theory looks great!
The real oil prices over the last 35 years are a total lack of
empirical evidence?
Well, considering your record on the empirical evidence about land
rent as a fraction of GDP....
>>> When its price exceeds the price of equivalent
>>> energy produced by other means, it will no longer pay to just burn it
>>> for its energy content, and oil consumption will stop growing and
>>> perhaps decline.
>
>Indeed. Exactly as happened with whale oil in the 1850s and coal in
>Britain at the turn of the last two centuries, **as experts had
>predicted**!
>
>Of course, what was wrong with those predictions was that the experts
>had predicted it all was going to happen because of the whales beingl
>killed off and Britain running out of coal bringing the Industrial
>Revolution to a grinding halt. Coal was a finite resource being
>consumed at an ever increasing rate with the cheapest supplies
>consumed first, which irrefutably = ever-rising prices, you know.
>
>Res ipsa loquitur. Who could argue?
>
>(As long as one didn't look at facts.)
?? Are you unaware that consumption of whale oil _did_ decline
dramatically, and that all the remaining whales in the world would not
be enough to supply more than a few _days'_ worth of current world oil
consumption?
>Clarification: How much oil do we want? Today the world is consuming
>80m b/day. For ease of computation let's up it to 100m barrels.
>
>Now we can restate the question with some specificity:
>
>Can the world produce an average 100m barrels of oil a day for the
>next 100 to 120 years at a price of no more than $55 to $70/b tops?
?? Oil consumption has been rising at an average 2%-3%/yr for
decades, and was rising faster than that before real oil prices
started climbing in the early 70s. Absent a good substitute, and
given the likely pattern of consumption growth emerging in China,
India, etc., global oil consumption is likely to double over the next
30 years, and double again in the following 30. How long do your
calculations say _that_ can go on?
-- Roy L
Robert J. Kolker
ro...@telus.net wrote:
> ?? Oil consumption has been rising at an average 2%-3%/yr for
> decades, and was rising faster than that before real oil prices
> started climbing in the early 70s. Absent a good substitute, and
> given the likely pattern of consumption growth emerging in China,
> India, etc., global oil consumption is likely to double over the next
> 30 years, and double again in the following 30. How long do your
> calculations say _that_ can go on?
Just until we can tap into our coal and methane (if we are silly) or
bring more geothermal and nuclear energy sources online (smarter). My
guess is that sunlight will only be a "filler" and never supply energy
on demand in industrial quantities. There is nothing right with using
sunlight (we use it to grow our food, for example) but you can't run
industry on it.
I include biomass under sunlight by the way. Sunlight is God's way of
turning chicken shit (which is not edible) into delicious tomatoes
(which are edible).
Bob Kolker
Frank Altschuler
<ro...@telus.net> wrote in message news:40cb8157...@news.telus.net...
> On Sat, 12 Jun 2004 04:50:05 GMT, Grinch <oldn...@mindspring.com>
> wrote:
> >
> >Although admittedly the geocentric solar system agreed much better
> >with empirical observations of reality.
>
> What has happened to the real price of oil over the last 35 years,
> Grinch? How about over the last 20 years?
>
From a quick glance at a chart that the folks at inflationdata.com have on
their site*, it seems that from 70 to 81 there was a BIG run up in the cost
of oil from $14 to nearly $60. Through the balance of the 80s, the price
dropped precipitiously though not back to $14. By '88 it was however down
to $18 and change. The recent numbers are pretty well all over the map with
a low of $11.50 in 1998 and of course the current unremarkable run up.
> >Meanwhile, we're all still waiting for our first observation of a
> >mineral resource rising in price perpetually (much less running out)
> >due to scarcity as a result of humanity's consumption of it.
>
> Do you or do you not understand that the real price of oil fell until
> about 1970, and has been rising since then? Don't you think 35 years
> is enough to establish a trend?
>
> >But as long as one ignores the total lack of all empirical evidence
> >needed to confirm it, the theory looks great!
>
> The real oil prices over the last 35 years are a total lack of empirical
evidence?
>
Looking at the actual inflation adjusted price of a barrel of oil I'd have
to say "Yes".
Now in all fairness, you did say "real price" so to come up with a "real
price" we'd have to factor in the costs of listening to ecoweenies whine
about how cheap gas has been and how much better things would be if it was
hideously expensive. That's a high cost indeed.
*
http://inflationdata.com/inflation/Inflation_Rate/Historical_Oil_Prices_Chart.asp
Grinch
<mt0...@sympatico.nospam-remove.ca> wrote:
>
>"Robert J. Kolker" <robert...@hotmail.com> wrote in message
>news:dQDyc.16687$eu.13258@attbi_s02...
>> Assume hypothetically that there is so much of the resource that at
>> current rates of consumption it won't run out for a thousand years.
>> Would the price be ever rising? I shold think the price would be
>> determined by the cost of extraction (that would be the floor) and the
>> demand for the product. Finiteness ipso facto does not imply an ever
>> increasing price.
>
>Quite true. Even when there is little of the resource left, price is still
>determined by the cost of extraction as long as there is competition.
Price is determined by supply and demand, never by production cost
(extraction price for oil).
Who the heck would price by production cost? If the production cost
is below the market price you've give up revenue for nothing. If
above, you could never get it.
Production cost determines how much is supplied. If the price of oil
is $25/b then a well with a $2/b cost in Arabia produces falt out --
but that oil is *not* priced in any way by production cost! -- but one
somewhere else with a $30/b cost closes down.
That adjustment in production feeds into supply, which then feeds into
the supply/demand price equation.
But price itself is always determined by supply and demand.
Grinch
Mr. Empirical, Master of Data, once and for all, for all of us to
see...
>On Sat, 12 Jun 2004 04:50:05 GMT, Grinch <oldn...@mindspring.com>
>wrote:
>
>>On Thu, 20 May 2004 14:01:39 -0700, "Darren" <repl...@news.group>
>>wrote:
>>>
>>><ro...@telus.net> wrote in message news:40abbe59...@news.telus.net...
>>>
>>>> What is going to happen is that the price of oil will
>>>> continue to rise.
>>
>>For exactly the same reason that increasing scarcity has steadily
>>driven up the cost of all other finite resources that have been
>>steadily consumed by humanity at an ever increasing rate.
>
>Not really. In the case of oil, a small fraction of the total
>resource is under enough pressure that it can be extracted just by
>drilling a hole and letting it flow. This extreme ease of extraction
>meant that for over 100 years up until the early 1970s, real oil
>prices fell pretty consistently as technology improved and reserves
>that could be tapped in that way were discovered.
>
>However, since the early 1970s, real oil prices have risen (as I said,
>and you denied)
Yup, a steady rise from $70/b in 1981 (today's money) to $14/b in
1998.
Your data is as good as ever, Roy.
And you are as in tune with the real world as ever.
If you think oil prices have risen steadily from $70 to $14, I guess
this explains your curious ideas about returns to real estate.;-)
> in part because of geopolitical events but primarily
>because the fraction of current oil supply that can be extracted at
>such very low cost has been declining.
So let's see ... after steadily falling for 100+ years -- in spite of
the cheapest oil being extracted and consumed first all the time at
steadily increasing rates, of course -- we get your "steady rise" ...-
consisting of a doubling of price in *one year* in 1973.
Hey, do the words "cartel" and "embargo" mean anything to you, Roy?
I mean, you are so sensitive to "rent seeking" in some obscure cases,
but when an new cartel arises and sends out press releases and hits
you over the head with a rent-seeking stick, doubling prices
immediately, *this* is a normal steady rise due to an erosion of
primary supplies. ;-)
OK .... then after that price is flat for six years, then there's a
revolution in a primary supplier and another "steady rise" consisting
of another doubling-and-a-half in 18 months.
Then comes your next 17-year "steady rise" from $70/b to 14/b, which
put the price lower even than the 1950s.
So, here is the **real world** scenario:
Prices steadily fall all the way for 130 years to effectively an
*all-time low* in 1998 -- the *only* interruption in the price fall
being two *brief* sharp spikes up do to "geopolitical events".
And at the end this time reserves are at an *all time high*
And the cost of finding each new barrel of oil had *declined 75%*
since 1981.
*This* is your evidence of supplies finally running out during all
those years since 1970. LMAO ;-)
OK ... now guess what the oil companies did in 1998 due to the big
losses they were suffering from all-time low prices.
They took production *off line*! Who'd a thunk it??
And a few years later the US economy booms, and simultaneously Japan
(the world's second largest economy) booms for the first time in 13
years ... China booms ... India booms ... and terrorists strike Saudi
Arabia ... in response to which price spikes up dramatically again to
*less than half* of what they were 23 years ago!
And this to you is not evidence of a *demand spike* in prices but of a
gradual long term loss of primary supply -- in spite of the fact that
reserves have grown *even higher*.
Nifty. ;-)
> Almost all oil extracted must
>now be pumped, at some cost in energy. It is this energy cost of oil
>that will be rising.
>
>>I mean, it's *extremely powerful logic*: A natural resource that is
>>finite in amount is consumed at an ever-increasing rate by humanity,
>>with the lowest cost supplies consumed first -- that commodity *must*
>>become more scarce and rise in price. QED. Res ipsa loquitur. Who
>>could argue?
>>
>>The logic is every bit as compelling as that of the geocentric solar
>>system and flat earth.
>>
>>Although admittedly the geocentric solar system agreed much better
>>with empirical observations of reality.
>
>What has happened to the real price of oil over the last 35 years,
>Grinch? How about over the last 20 years?
20 years:
1984: $52 per barrel (2004 dollars)
2004: $34 per barrel (average through May)
You know, Roy, for a guy with such strong opinions you don't actually
*know* anything. Eh?
I mean, personally, before I went on and on with all these price
claims I'd *check them* to make sure I wasn't making an ass of myself.
BTW,the quality of all your empirical claims re Georgism and land
values and all that stuff is really being confirmed for us here.
>>Meanwhile, we're all still waiting for our first observation of a
>>mineral resource rising in price perpetually (much less running out)
>>due to scarcity as a result of humanity's consumption of it.
>
>Do you or do you not understand that the real price of oil fell until
>about 1970, and has been rising since then?
1970: $16.47 per barrel
1998: $14.00 per barrel (2004 dollars)
Does "rising" have a different meaning in Canada?
>Don't you think 35 years
>is enough to establish a trend?
I'd say about 140 years through 1998 probably constitutes a trend.
And looking at things another way...
1981: $70 per barrel
2003: $21 per barrel
... I'd probably say that 22 years constitutes a trend too.
Compared to *that*, do you think a one year price spike constitutes a
trend?
Roy, it looks to me like your long-term "trends" consist entirely of
the three years 1973, 1981 and 2004 ... with all the rest of the last
140 years being various short-term aberrations off trend. ;-)
>>But as long as one ignores the total lack of all empirical evidence
>>needed to confirm it, the theory looks great!
>
>The real oil prices over the last 35 years are a total lack of
>empirical evidence?
Roy, you are *so funny*.
Really, why didn't you check the price numbers before going on and on
about them like this?
Now here's a question for you:
Three years ago there was a big milk surplus down here, and a
recession too, prices fell real low, so a lot of farmers got rid of
their milk cows and went into something else.
This year there is a *boom* and milk demand is *way up* -- and the
price of a gallon of milk has risen by *much more* than that of a
gallon of gasoline! It's true!! And with summer the price of ice
cream has shot up even more than that!! You can look it up!
Now, reading the "trend" of this one-year price spike and its deeper
meaning, do you conclude the nation is finally and forever running out
of cows?
>Well, considering your record on the empirical evidence about land
>rent as a fraction of GDP....
>
>>>> When its price exceeds the price of equivalent
>>>> energy produced by other means, it will no longer pay to just burn it
>>>> for its energy content, and oil consumption will stop growing and
>>>> perhaps decline.
>>
>>Indeed. Exactly as happened with whale oil in the 1850s and coal in
>>Britain at the turn of the last two centuries, **as experts had
>>predicted**!
>>
>>Of course, what was wrong with those predictions was that the experts
>>had predicted it all was going to happen because of the whales beingl
>>killed off and Britain running out of coal bringing the Industrial
>>Revolution to a grinding halt. Coal was a finite resource being
>>consumed at an ever increasing rate with the cheapest supplies
>>consumed first, which irrefutably = ever-rising prices, you know.
>>
>>Res ipsa loquitur. Who could argue?
>>
>>(As long as one didn't look at facts.)
>
>?? Are you unaware that consumption of whale oil _did_ decline
>dramatically, and that all the remaining whales in the world would not
>be enough to supply more than a few _days'_ worth of current world oil
>consumption?
Bwaah! ha! ha!
Am I unaware that *whales* couldn't provide more than a few days worth
of the world's current oil consumption???
Are you saying that they *could* provide a few days worth?
Roy, you have finally gone stark raving mad.
ROTFLMAO! ;-)
Let me just say that it is a very good thing that we do have "markets"
that operate with much competition which provides incentives for good
things like continuous innovation and increased productivity and cost
reduction and efficient substitution ... so that when it *came down to
it*, we didn't have to -- and weren't even tempted to -- build our
modern 21st Century economy entirely on whale oil.
We can agree on that, eh?
Now I leave you with one final question to ponder:
1949: $20.06 per barrel
1970: $16.47 per barrel
1998: $14.00 per barrel (2004 dollars)
Trend or not?
<snip>
Matt Timmermans
"Grinch" <oldn...@mindspring.com> wrote in message
news:e9tnc0pg75age2d6m...@4ax.com...
> Price is determined by supply and demand, never by production cost
> (extraction price for oil).
Yes, of course. It would have been clearer if I had said that the supply
curve is determined by production costs, which are often only loosely
coupled to scarcity.
I emphasize this, because it is a common myth that a free market protects
resources by moderating consumption when they become scarce.
ro...@telus.net
wrote:
This is interesting. As usual, you choose to baldly lie about what I
have written, but in this case the proof that you are lying is right
there in front of your readers' eyes. Look up about 10 lines. Yep.
There it is. I said since the early 1970s, not since 1981, liar. And
I did not say the price rise since then had been steady, liar. And I
did not say the end-point of oil price history had been reached in
1998, liar.
>And you are as in tune with the real world as ever.
Unlike you, for example....?
>If you think oil prices have risen steadily from $70 to $14, I guess
>this explains your curious ideas about returns to real estate.;-)
Right. You have chosen to lie about what I wrote, as usual, and
insert the word, "steadily," which I did not say. "Steadily" would
more accurately be applied to how oil prices declined from about the
1880s to 1972 (though that decline was also by no means monotonic due
to wars, financial panics, etc.). What was _really_ steady was the
price decline between about 1957 and 1972. Prices since then have
been far more volatile, but the trend has certainly been up. Which is
why I did not say they had risen "steadily." And why, as usual, you
had to lie about what I had written in order to have anything to say
about it at all.
>> in part because of geopolitical events but primarily
>>because the fraction of current oil supply that can be extracted at
>>such very low cost has been declining.
>
>So let's see ... after steadily falling for 100+ years -- in spite of
>the cheapest oil being extracted and consumed first all the time at
>steadily increasing rates, of course
Right, because for most of that time, "cheapest" just meant "closest
to the required infrastructure," not "easiest to extract" in any
fundamental geological sense. The distribution of exploratory
drilling activity relative to later proven reserves shows clearly that
some areas with large low-cost reserves were long virtually ignored,
while other areas where extraction costs were already much higher were
nevertheless intensively explored.
>-- we get your "steady rise" ...-
<sigh> You are really trying to outdo yourself in the dishonesty
department, aren't you? To put "steady rise" in quotation marks like
that, and baldly claim that I said it when I did not say it or
anything remotely like it, makes you just a flat-out liar. Of course,
no one reading this could possibly find that in any way surprising or
unexpected.
>consisting of a doubling of price in *one year* in 1973.
>
>Hey, do the words "cartel" and "embargo" mean anything to you, Roy?
Yes. That might even be why I mentioned geopolitical events...
>I mean, you are so sensitive to "rent seeking" in some obscure cases,
??? "Obscure"? Intellectual property is "obscure"? Landowning is
"obscure"? Union monopoly privileges are "obscure"?
>but when an new cartel arises and sends out press releases and hits
>you over the head with a rent-seeking stick, doubling prices
>immediately, *this* is a normal steady rise due to an erosion of
>primary supplies. ;-)
Which of course I never said, nor implied.
):^|
>OK .... then after that price is flat for six years, then there's a
>revolution in a primary supplier and another "steady rise" consisting
>of another doubling-and-a-half in 18 months.
>
>Then comes your next 17-year "steady rise" from $70/b to 14/b, which
>put the price lower even than the 1950s.
For about a minute, anyway...
>So, here is the **real world** scenario:
>
>Prices steadily fall all the way for 130 years to effectively an
>*all-time low* in 1998
Garbage. The all-time low was reached in the early 1930s, not
surprisingly to anyone but you, and the decline from the 1860s to the
1880s, for example, was by no means steady.
>-- the *only* interruption in the price fall
>being two *brief* sharp spikes up do to "geopolitical events".
Ridiculous. Please try to educate yourself, or at least to be a
little more honest and respectful of your readers, and not assume they
will be fooled by such transparent lies.
The long-term world oil price charts at
http://www.wtrg.com/prices.htm
prove that your claims are flat false.
>And at the end this time reserves are at an *all time high*
Reserves by what definition? Are you not even a tiny bit skeptical
about reserve figures showing no increase in reserves from 1970 to
1985, and then a near-50% increase over the next few years, despite
_fewer_ new field discoveries? Are you unaware that OPEC rewards
increases in its members' reported reserves with increases in
production quotas?
>And the cost of finding each new barrel of oil had *declined 75%*
>since 1981.
Which, not coincidentally, is about how much new field discoveries
declined over the same period....
Grinch, the reason per-barrel discovery costs declined so much was
that new technology made it much easier to rule out many exploration
areas as non-prospective, reducing the amount of money spent drilling
where there wasn't, and couldn't be, any oil. What you cite as
evidence that oil is getting easier to discover is in fact evidence
that there is very little of it left to discover: even the tight focus
on the most prospective areas that the new technology made possible
_still_ didn't result in an increase in new field discoveries. Just
in less money wasted on non-discoveries.
>*This* is your evidence of supplies finally running out during all
>those years since 1970. LMAO ;-)
<yawn> I didn't say supplies were running out. I said prices were
rising because the cheapest-to-extract supplies were running out.
>And a few years later the US economy booms, and simultaneously Japan
>(the world's second largest economy) booms for the first time in 13
>years ... China booms ... India booms ... and terrorists strike Saudi
>Arabia ... in response to which price spikes up dramatically again to
>*less than half* of what they were 23 years ago!
But nevertheless far more than they were 33 _or_ 43 _or_ 53, 63 or 73
years ago...
>And this to you is not evidence of a *demand spike* in prices but of a
>gradual long term loss of primary supply -- in spite of the fact that
>reserves have grown *even higher*.
Almost all of which increase in reserves occurred in the late 1980s
for political reasons, and represents upward revisions of the reserves
in known fields, not new field discoveries. The chart at the bottom
of
http://wwwistp.murdoch.edu.au/teaching/N212/n212content/topics/topic5/03worldoilgas.html
is quite revealing on that score.
>>>I mean, it's *extremely powerful logic*: A natural resource that is
>>>finite in amount is consumed at an ever-increasing rate by humanity,
>>>with the lowest cost supplies consumed first -- that commodity *must*
>>>become more scarce and rise in price. QED. Res ipsa loquitur. Who
>>>could argue?
>>>
>>>The logic is every bit as compelling as that of the geocentric solar
>>>system and flat earth.
>>>
>>>Although admittedly the geocentric solar system agreed much better
>>>with empirical observations of reality.
>>
>>What has happened to the real price of oil over the last 35 years,
>>Grinch? How about over the last 20 years?
>
>20 years:
>
>1984: $52 per barrel (2004 dollars)
>2004: $34 per barrel (average through May)
>
>You know, Roy, for a guy with such strong opinions you don't actually
>*know* anything. Eh?
?? Oh, dear...
It seems you slightly misunderstood what I was asking. A starting
price and an ending price do not say what has happened to the price
_over_ the period. Oil peaked a little over 20 years ago, at real
prices it hadn't seen in 100 years, and then fell to a 1988 _low_
about _50%_higher_than_ its average price in the ten years to 1973.
It then rose and fell quite substantially, and at its 1998 minimum
(triggered by the 1997 East Asian financial panic) _briefly_touched_
the levels it had been at for a solid _decade_ up to 1973. Since that
_very_brief_ 1998 minimum, it has of course soared to _sustained_ real
prices far above the _sustained_ prices of the pre-1973 era.
Now, as for the 35-year price history, for which you not so
unexpectedly declined to proved any response at all, you are of course
aware that the price from 1969 to 1973 was _always_ far below the
average price since then, and that the low price attained for about 15
minutes in 1998 has been followed by much more typical -- i.e., much
higher -- post-1973 prices.
>I mean, personally, before I went on and on with all these price
>claims I'd *check them* to make sure I wasn't making an ass of myself.
<snicker> No, you wouldn't. You didn't. And _you_ consequently
_have_ made an ass of yourself.
>BTW,the quality of all your empirical claims re Georgism and land
>values and all that stuff is really being confirmed for us here.
Indeed. Look at the price charts at the url I gave above, especially
the 1867-2003 chart. The general accuracy of my description of how
oil prices have changed over time, and the falsehood and dishonesty of
your description, are perfectly evident.
>>>Meanwhile, we're all still waiting for our first observation of a
>>>mineral resource rising in price perpetually (much less running out)
>>>due to scarcity as a result of humanity's consumption of it.
>>
>>Do you or do you not understand that the real price of oil fell until
>>about 1970, and has been rising since then?
>
>1970: $16.47 per barrel
>1998: $14.00 per barrel (2004 dollars)
>
>Does "rising" have a different meaning in Canada?
2004: $40/bbl. Does "since then" have a different meaning in what you
are no doubt pleased to call your "brain"?
>>Don't you think 35 years
>>is enough to establish a trend?
>
>I'd say about 140 years through 1998 probably constitutes a trend.
Uh-huh. But only if you ignore what has happened in all the years
since 1973, aside from 1998...
>And looking at things another way...
>
>1981: $70 per barrel
A peak it had not seen for 100 years...
>2003: $21 per barrel
>
>... I'd probably say that 22 years constitutes a trend too.
Oh? What happened to the $16.47/bbl in 1970 that you seemed to be
aware of just a few lines up? Or any of the other
_sustained_low_prices_ before 1973?
>Compared to *that*, do you think a one year price spike constitutes a
>trend?
Look at the chart, Grinch. And you evidently think a one-year price
_dip_ constitutes a trend...
>Roy, it looks to me like your long-term "trends" consist entirely of
>the three years 1973, 1981 and 2004 ...
Look at the chart, liar.
>with all the rest of the last
>140 years being various short-term aberrations off trend. ;-)
Look at the chart, liar. The long-term downtrend ended in 1973. Deal
with it.
>>>But as long as one ignores the total lack of all empirical evidence
>>>needed to confirm it, the theory looks great!
>>
>>The real oil prices over the last 35 years are a total lack of
>>empirical evidence?
>
>Roy, you are *so funny*.
ROTFL!! Grinch, you are _so_stupid_. You ducked and dodged and ran
away whimpering like a frightened little boy when I asked you what oil
prices had done over the last 35 years. Now's your chance to act like
a man for a change, and you blow it again. How sad.
>Really, why didn't you check the price numbers before going on and on
>about them like this?
I have. Look at the price chart, Grinch.
>Now here's a question for you:
>
>Three years ago there was a big milk surplus down here, and a
>recession too, prices fell real low, so a lot of farmers got rid of
>their milk cows and went into something else.
>
>This year there is a *boom* and milk demand is *way up* -- and the
>price of a gallon of milk has risen by *much more* than that of a
>gallon of gasoline! It's true!! And with summer the price of ice
>cream has shot up even more than that!! You can look it up!
>
>Now, reading the "trend" of this one-year price spike and its deeper
>meaning, do you conclude the nation is finally and forever running out
>of cows?
One year does not make a trend -- not even 1998, unfortunately for
you. Contrary to your claims, 1998 was not the last year oil would
ever have a price, and the _momentary_ bottom touched in that year
(which, contrary to your claims, was not the all-time low -- that was
reached in the early 1930s) did not establish the long-term trend in
oil prices. Sorry. You are just making a fool of yourself by
claiming that the brief dip of 1998 defined the permanent, long-term
oil price trend.
>>>>> When its price exceeds the price of equivalent
>>>>> energy produced by other means, it will no longer pay to just burn it
>>>>> for its energy content, and oil consumption will stop growing and
>>>>> perhaps decline.
>>>
>>>Indeed. Exactly as happened with whale oil in the 1850s and coal in
>>>Britain at the turn of the last two centuries, **as experts had
>>>predicted**!
>>>
>>>Of course, what was wrong with those predictions was that the experts
>>>had predicted it all was going to happen because of the whales beingl
>>>killed off and Britain running out of coal bringing the Industrial
>>>Revolution to a grinding halt. Coal was a finite resource being
>>>consumed at an ever increasing rate with the cheapest supplies
>>>consumed first, which irrefutably = ever-rising prices, you know.
>>>
>>>Res ipsa loquitur. Who could argue?
>>>
>>>(As long as one didn't look at facts.)
>>
>>?? Are you unaware that consumption of whale oil _did_ decline
>>dramatically, and that all the remaining whales in the world would not
>>be enough to supply more than a few _days'_ worth of current world oil
>>consumption?
>
>Bwaah! ha! ha!
>
>Am I unaware that *whales* couldn't provide more than a few days worth
>of the world's current oil consumption???
Yes. That's what I asked you.
>Are you saying that they *could* provide a few days worth?
No. Why do you feel you always have to lie about what I write? I'm
not sure exactly how much energy there is in all the whale oil
remaining in the world, but it's certainly no more than a few days'
petroleum consumption worth.
The point is, you said the experts who said the world was running out
of whales and could not continue to use them as a source of energy for
very much longer were not looking at the facts. But they were. They
were right.
>Let me just say that it is a very good thing that we do have "markets"
>that operate with much competition which provides incentives for good
>things like continuous innovation and increased productivity and cost
>reduction and efficient substitution ... so that when it *came down to
>it*, we didn't have to -- and weren't even tempted to -- build our
>modern 21st Century economy entirely on whale oil.
>
>We can agree on that, eh?
Yes, because for once, you did not lie about what I wrote.
>Now I leave you with one final question to ponder:
>
>1949: $20.06 per barrel
I note that this was the peak price recorded any time between 1927 and
1973...
>1970: $16.47 per barrel
>1998: $14.00 per barrel (2004 dollars)
And this was of course the _lowest_ price recorded any time since
1973...
>Trend or not?
Certainly these data demonstrate a trend: your unmistakable trend to
dishonestly presenting cherry-picked data, on the few occasions you
present any data at all.
Look, just go to the price charts at http://www.wtrg.com/prices.htm,
Grinch, and tell us what you see. And for once in your life, try to
be honest.
Oh, and I'll leave you with a question:
1932: $9/bbl
1968: $18/bbl
2004: $36/bbl (2004 dollars)
Your cherry-picked data showed a price decline of 30% in 50 years. My
data are not cherry-picked. I just chose the all-time low price, and
the most recent price, and the price at a date midway between those
times. And _those_ data show a price _increase_ of _300%_ over _72_
years.
Trend or not?
-- Roy L
ro...@telus.net
wrote:
>Price is determined by supply and demand, never by production cost
>(extraction price for oil).
Maybe you could tell that to the clowns who refuse to know the fact
that a tax on land rent, because it does not affect either supply or
demand, cannot be passed on to tenants.
-- Roy L
Dave Morrison
http://www.nypress.com/17/22/news&columns/AaronNaparstek.cfm
Ron Peterson
> A good article on the topic:
> http://www.nypress.com/17/22/news&columns/AaronNaparstek.cfm
If it costs us $15-$20 a barrel (according to article) to protect the
delivery of that oil from foreign sources, should the US institute a
tariff to collect those costs?
--
Ron
susupply
<ro...@telus.net>
the only Mensan I've ever met who can't read (his own sources)
wrote in message news:40ccba5b...@news.telus.net...
> >>However, since the early 1970s, real oil prices have risen (as I said,
> >>and you denied)
[snip]
> >> in part because of geopolitical events but primarily
> >>because the fraction of current oil supply that can be extracted at
> >>such very low cost has been declining.
For which claim he cites as evidence:
> http://www.wtrg.com/prices.htm
But, had he bothered to actually (if he can) read the material he would have
found exactly THE OPPOSITE. For example:
<< If long term history is a guide, those in the upstream segment of the
crude oil industry should structure their business to be able to operate
with a profit, below $15.28 per barrel half of the time. >>
and
<< Crude Oil prices ranged between $2.50 and $3.00 from 1948 through the end
of the 1960s.
<<...In 1996 dollars crude oil prices fluctuated between $14 - $16 during
the same period. ....
<< From 1958 to 1970 prices were stable at about $3.00 per barrel, but in
real terms the price of crude oil declined from above $15 to below $12 per
barrel. ....
<<....In March 1971, the balance of power shifted. That month the Texas
Railroad Commission set proration at 100 percent for the first time. This
meant that Texas producers were no longer limited in the amount of oil that
they could produce. More importantly, it meant that the power to control
crude oil prices shifted from the United States (Texas, Oklahoma and
Louisiana) to OPEC.
<< ....If there was any doubt that the ability to control crude oil prices
had passed from the United States to OPEC it was removed during the Arab Oil
Embargo. The extreme sensitivity of prices to supply shortages became all
too apparent when prices increased 400 percent in six short months.
<< From 1974 to 1978 world crude oil prices were relatively flat ranging
from $12.21 per barrel to $13.55 per barrel. When adjusted for inflation
the prices were constant over this period of time.
<< Crises in Iran and Iraq
<< Events in Iran and Iraq led to another round of crude oil price increases
in 1979 and 1980. >>
Pity. Once again, Roy, you had a "chance to act like a man for a change,
Grinch
wrote:
>A good article on the topic:
>
>http://www.nypress.com/17/22/news&columns/AaronNaparstek.cfm
That was the dumbest-ass article I ever read on the subject.
(Remember the source is a free weekly hand-out downmarket from the
Village Voice, financed largely by porn ads picked up from the failed
"Screw").
Let's see:
. it understated remaining oil supply by only a mere 2 trillion
barrels as per the USGS
. somehow overlooked that there's six times as much oil in Canadian
oil sands as in Saudi Arabia, and there are enough proven reserves in
Alberta alone right now to meet North American import needs for the
next 40 years.
.claimed oil keeps getting harder to find while neglecting to mention
that the cost of finding each new barrel has dropped 75% in the last
20 years.
. claimed *all* projections, including the most optimistic, say
production will peak by 2020 at the latest -- while the USGS and USEIA
project the date at from 2037 - 2047 ... etc., etc.,
I could go on and on with the dumb-assedness in it -- frankly, proof
of either incompetence or lying.
But of course the Mother Dumbass Claim in it, compared to which the
rest is all mere detail, is that there is *no substitute* for pumped
oil -- as we can substitute bran for corn flakes -- so we must prepare
for the coming production top "as seriously as for nuclear war"
literally.
*As if* Germany and South Africa hadn't already actually run their
economies on oil-from-coal, and *as if* gasoline from Canadian oil
sands isn't going into your car right now.
And *as if* there isn't enough oil sands, coal, etc. and so on, to
produce oil on the foreseeably desired scale for maybe another 1,000
years, starting when those overlooked 2 trillion barrels should need
topping off.
Grinch
wrote:
Don't forget to add the cost of the Pacific Fleet and those Army
divisions in South Korea to that of the VCRs and microwave ovens whose
import they are stationed to protect.
ro...@telus.net
wrote:
><ro...@telus.net>
>
>the only Mensan I've ever met who can't read (his own sources)
You've never met me, liar. And as I will prove below, I read my
source far more accurately than you.
> wrote in message news:40ccba5b...@news.telus.net...
>
>> >>However, since the early 1970s, real oil prices have risen (as I said,
>> >>and you denied)
>
>[snip]
>
>> >> in part because of geopolitical events but primarily
>> >>because the fraction of current oil supply that can be extracted at
>> >>such very low cost has been declining.
>
>For which claim he cites as evidence:
>
>> http://www.wtrg.com/prices.htm
>
>But, had he bothered to actually (if he can) read the material he would have
>found exactly THE OPPOSITE.
That is a lie, and you are lying filth.
>For example:
>
><< If long term history is a guide, those in the upstream segment of the
>crude oil industry should structure their business to be able to operate
>with a profit, below $15.28 per barrel half of the time. >>
I cited the source's price data. That is not price data. That is an
editorial opinon which IMO makes very little sense, as it assumes
prices decades ago define current prices.
And anyway, it says _if_ long term history is a guide. The chart
shows clearly that it isn't. Your claim that this statement
contradicts _any_ of my statements is therefore exposed as a lie.
>and
>
><< Crude Oil prices ranged between $2.50 and $3.00 from 1948 through the end
>of the 1960s.
That is nominal. The chart shows _real_ prices declining over the
same period, which makes sense, if you are intelligent and
knowledgeable enough (hint: you're not) to realize that there was mild
inflation over that period, resulting in declining real prices.
You are destroyed.
><<...In 1996 dollars crude oil prices fluctuated between $14 - $16 during
>the same period. ....
Nope. The chart shows clearly that there was a little fluctuation
1947-1957, but then a steady decline until 1973.
><< From 1958 to 1970 prices were stable at about $3.00 per barrel, but in
>real terms the price of crude oil declined from above $15 to below $12 per
>barrel. ....
Exactly as I said. Which proves that you lied again.
><< ....If there was any doubt that the ability to control crude oil prices
>had passed from the United States to OPEC it was removed during the Arab Oil
>Embargo. The extreme sensitivity of prices to supply shortages became all
>too apparent when prices increased 400 percent in six short months.
>
><< From 1974 to 1978 world crude oil prices were relatively flat ranging
>from $12.21 per barrel to $13.55 per barrel. When adjusted for inflation
>the prices were constant over this period of time.
The real price chart proves I was absolutely correct, lying filth.
><< Crises in Iran and Iraq
><< Events in Iran and Iraq led to another round of crude oil price increases
>in 1979 and 1980. >>
>
>Pity. Once again, Roy, you had a "chance to act like a man for a change,
>and you blow it again. How sad."
??? ROTFL!!! You have, again, been exposed for the lying filth you
are. Deal with it.
-- Roy L
susupply
<ro...@telus.net>
who also doesn't read his own sci.econ posts,
wrote in message news:40ce2ded...@news.telus.net...
> On Mon, 14 Jun 2004 21:03:18 GMT, "susupply" <susu...@mindspring.com>
> wrote:
>
> ><ro...@telus.net>
> >
> >the only Mensan I've ever met who can't read (his own sources)
>
> You've never met me, liar. And as I will prove below, I read my
> source far more accurately than you.
Moron, your claim was that the PRIMARY cause of price increases after the
early 1970s was:
> >> >> ...primarily
> >> >>because the fraction of current oil supply that can be extracted at
> >> >>such very low cost has been declining.
YOUR SOURCE says it was OPEC using the Israeli war of 1973 as an excuse for
an embargo, the Iranian revolution, and the Iraq-Iran war of the early '80s.
Which is what Grinch told you.
> ><< If long term history is a guide, those in the upstream segment of the
> >crude oil industry should structure their business to be able to operate
> >with a profit, below $15.28 per barrel half of the time. >>
>
> I cited the source's price data. That is not price data.
$15.28 per barrel is not PRICE data? What, pray tell, is it then? (And,
it's right there in your source.)
> That is an
> editorial opinon which IMO makes very little sense, as it assumes
> prices decades ago define current prices.
YOUR SOURCE said: "In the post World War II era oil prices have averaged
$19.61 per barrel adjusted for inflation in 2000 dollars. Through the same
period the median price for domestic crude oil was $15.25 in 2000 prices.
That means that only fifty percent of the time from 1947 to 2003 have oil
prices exceeded $15.25 per barrel."
Note that 2003 is not "decades ago".
> And anyway, it says _if_ long term history is a guide. The chart
> shows clearly that it isn't. Your claim that this statement
> contradicts _any_ of my statements is therefore exposed as a lie.
YOUR SOURCE used that chart in making its predictions.
> >and
> >
> ><< Crude Oil prices ranged between $2.50 and $3.00 from 1948 through the
end
> >of the 1960s.
>
> That is nominal.
Moron, the above was followed with:
> ><<...In 1996 dollars crude oil prices fluctuated between $14 - $16 during
> >the same period. ....
> The chart shows _real_ prices declining over the
> same period, which makes sense, if you are intelligent and
> knowledgeable enough (hint: you're not) to realize that there was mild
> inflation over that period, resulting in declining real prices.
Neither mild, nor wild, inflation means "declining real prices".
> You are destroyed.
You are a suicide bomber.
> ><<...In 1996 dollars crude oil prices fluctuated between $14 - $16 during
> >the same period. ....
>
> Nope. The chart shows clearly that there was a little fluctuation
> 1947-1957, but then a steady decline until 1973.
The price, according to YOUR SOURCE's graph, was the same in 1947 and 1966.
>> ><< From 1958 to 1970 prices were stable at about $3.00 per barrel, but
in
> >real terms the price of crude oil declined from above $15 to below $12
per
> >barrel. ....
>
> Exactly as I said. Which proves that you lied again.
Your story was:
> ...for over 100 years up until the early 1970s, real oil
>>prices fell pretty consistently
From 1958 to 1970 is TWELVE YEARS, Mensa Breath.
> ><< ....If there was any doubt that the ability to control crude oil
prices
> >had passed from the United States to OPEC it was removed during the Arab
Oil
> >Embargo. The extreme sensitivity of prices to supply shortages became
all
> >too apparent when prices increased 400 percent in six short months.
> >
> ><< From 1974 to 1978 world crude oil prices were relatively flat ranging
> >from $12.21 per barrel to $13.55 per barrel. When adjusted for inflation
> >the prices were constant over this period of time.
>
> The real price chart proves I was absolutely correct, lying filth.
First, your story is that the prices were RISING at this time.
Second, the above, along with:
> ><< Crises in Iran and Iraq
> ><< Events in Iran and Iraq led to another round of crude oil price
increases
> >in 1979 and 1980. >>
is a refutation of your claim that it was due "primarily" to "the fraction
of current oil supply that can be extracted at very low cost has been
declining". YOUR SOURCE has destroyed that argument.
ro...@telus.net
dishonest context-chopping. Read and learn what true commitment to
deceitfulness really is.
On Mon, 14 Jun 2004 23:57:53 GMT, "susupply" <susu...@mindspring.com>
wrote:
><ro...@telus.net>
>
>who also doesn't read his own sci.econ posts,
>
> wrote in message news:40ce2ded...@news.telus.net...
>> On Mon, 14 Jun 2004 21:03:18 GMT, "susupply" <susu...@mindspring.com>
>> wrote:
>>
>> ><ro...@telus.net>
>> >
>> >the only Mensan I've ever met who can't read (his own sources)
>>
>> You've never met me, liar. And as I will prove below, I read my
>> source far more accurately than you.
>
>Moron, your claim was that the PRIMARY cause of price increases after the
>early 1970s was:
>
>> >> >> ...primarily
>> >> >>because the fraction of current oil supply that can be extracted at
>> >> >>such very low cost has been declining.
>
>YOUR SOURCE
<yawn> Oh, grow up, little boy. I provided a source of historical
price charts that proved I was right about the direction of prices and
Grinch was wrong. I did not say I bought into everything on the site.
Much of it makes no sense, like the silly idea of averaging the price
of oil over half a century as a guide to future prices (which you so
hilariously embraced).
>says it was OPEC using the Israeli war of 1973 as an excuse for
>an embargo, the Iranian revolution, and the Iraq-Iran war of the early '80s.
>Which is what Grinch told you.
<yawn> The Iran-Iraq war, the last of those events, has been over for
like 15 years. Oil is flirting with $40/bbl. You are destroyed.
>> ><< If long term history is a guide, those in the upstream segment of the
>> >crude oil industry should structure their business to be able to operate
>> >with a profit, below $15.28 per barrel half of the time. >>
>>
>> I cited the source's price data. That is not price data.
>
>$15.28 per barrel is not PRICE data? What, pray tell, is it then? (And,
>it's right there in your source.)
No, it isn't. It's the _median_ of US prices over several decades,
stated in 2000 dollars, a virtually meaningless number. Too bad you
cannot figure out for yourself what such numbers are.
>> That is an
>> editorial opinon which IMO makes very little sense, as it assumes
>> prices decades ago define current prices.
>
>YOUR SOURCE said: "In the post World War II era oil prices have averaged
>$19.61 per barrel adjusted for inflation in 2000 dollars. Through the same
>period the median price for domestic crude oil was $15.25 in 2000 prices.
>That means that only fifty percent of the time from 1947 to 2003 have oil
>prices exceeded $15.25 per barrel."
>
>Note that 2003 is not "decades ago".
??? 1947 is. And in fact, so are _most_ of the years from 1947 to
2003. Duh.
<snicker> I'm afraid it's become a little too easy to see why _you_
didn't get into Mensa...
>> And anyway, it says _if_ long term history is a guide. The chart
>> shows clearly that it isn't. Your claim that this statement
>> contradicts _any_ of my statements is therefore exposed as a lie.
>
>YOUR SOURCE used that chart in making its predictions.
I cited the source's historical real price charts, not its editorial
opinions or price _predictions_.
>> >and
>> >
>> ><< Crude Oil prices ranged between $2.50 and $3.00 from 1948 through the
>end
>> >of the 1960s.
>>
>> That is nominal.
>
>Moron, the above was followed with:
>
>> ><<...In 1996 dollars crude oil prices fluctuated between $14 - $16 during
>> >the same period. ....
Thank you for quoting the proof that I was right.
>> The chart shows _real_ prices declining over the
>> same period, which makes sense, if you are intelligent and
>> knowledgeable enough (hint: you're not) to realize that there was mild
>> inflation over that period, resulting in declining real prices.
>
>Neither mild, nor wild, inflation means "declining real prices".
??? Uh, it does when the nominal prices don't rise at least as fast
as the inflation. Which they didn't. As the real price charts
clearly show. And as you are clearly not intelligent enough to
understand.
>> ><<...In 1996 dollars crude oil prices fluctuated between $14 - $16 during
>> >the same period. ....
>>
>> Nope. The chart shows clearly that there was a little fluctuation
>> 1947-1957, but then a steady decline until 1973.
>
>The price, according to YOUR SOURCE's graph, was the same in 1947 and 1966.
?? And...? How, in what you are no doubt pleased to call your
"mind," does that contradict what I said? In 1947 the real price was
still rising towards its post-war peak in 1948-9, a peak it revisited
in 1957 before declining steadily until 1973.
>>> ><< From 1958 to 1970 prices were stable at about $3.00 per barrel, but
>in
>> >real terms the price of crude oil declined from above $15 to below $12
>per
>> >barrel. ....
>>
>> Exactly as I said. Which proves that you lied again.
>
>Your story was:
>
>> ...for over 100 years up until the early 1970s, real oil
>>>prices fell pretty consistently
>
>From 1958 to 1970 is TWELVE YEARS, Mensa Breath.
You have simply taken that statement from a different context and
falsely claimed I made it in this context. That sort of cheap,
despicable deceit is a favored technique you use when you need to
cover up one of your lies with another lie.
>> ><< ....If there was any doubt that the ability to control crude oil
>prices
>> >had passed from the United States to OPEC it was removed during the Arab
>Oil
>> >Embargo. The extreme sensitivity of prices to supply shortages became
>all
>> >too apparent when prices increased 400 percent in six short months.
>> >
>> ><< From 1974 to 1978 world crude oil prices were relatively flat ranging
>> >from $12.21 per barrel to $13.55 per barrel. When adjusted for inflation
>> >the prices were constant over this period of time.
>>
>> The real price chart proves I was absolutely correct, lying filth.
>
>First, your story is that the prices were RISING at this time.
That is a lie. Prices have fluctuated wildly since 1973, and I never
said otherwise. The trend has definitely been up, as the chart
proves.
>Second, the above, along with:
>
>> ><< Crises in Iran and Iraq
>> ><< Events in Iran and Iraq led to another round of crude oil price
>increases
>> >in 1979 and 1980. >>
>
> is a refutation of your claim that it was due "primarily" to "the fraction
>of current oil supply that can be extracted at very low cost has been
>declining". YOUR SOURCE has destroyed that argument.
No, lying filth, it simply places a different emphasis on the causes
of the price increases that proved I was right and Grinch was wrong.
Of course the 1973 embargo, the Iran revolution and other events
caused large price increases. That's why I mentioned "geopolitical
events." Remember? But such events cannot explain why prices have
been higher, and usually _much_ higher, for three decades running,
except for a brief moment in 1998 when they revisted the low of 1972
(and even then did not approach the low of 1932).
-- Roy L
Jim Blair
>Here's another fine example of Patrick's astonishing gift for
>dishonest context-chopping. Read and learn what true commitment to
>deceitfulness really is.
>
><yawn> Oh, grow up, little boy. I provided a source of historical
>price charts that proved I was right about the direction of prices and
>Grinch was wrong. I did not say I bought into everything on the site.
>Much of it makes no sense, like the silly idea of averaging the price
>of oil over half a century as a guide to future prices (which you so
>hilariously embraced).
Hi,
Nice chart, but different people see different things in it. Some see that
crude oil is cheaper now than in 1867. Some see that crude prices have
been in an upward trend since 1998. (I see both ;-)
Since this is all in real dollars, your statement:
>... The chart shows _real_ prices declining over the
>same period, which makes sense, if you are intelligent and
>knowledgeable enough (hint: you're not) to realize that there was mild
>inflation over that period,(1948-60) resulting in declining real prices.
does not make sense. Declining real oil prices were not a result of mild
inflation: they COULD have gone either way. And is it the *real* price
which counts? Or is it the price relative to incomes?
Anyway the issue here is not the past oil price trend, but the future. I
am reminded of a past 3 way exchange with Jay Hanson and Grinch. (which
may not have been posted since I can't find it with a Google search :-(
but was in about 1998. Jay said we would soon run out of oil and all die
off. Grinch said energy prices have been declining for the last 300 years
and they would likely continue to drop.
I predicted increased gasoline prices for the next 10-20 years as demand
increased faster than extraction, and questions were raised about the
supply. I commented that I would not buy a high milage car/SUV.
I say my prediction has been the closest. Energy prices will likely drop
in the more distant future as substitutes for oil are brought on line.
Probably hydrogen made fron water using wind, solar or nuclear energy.
Grinch will be correct in that "long run", but not for the next decade.
And Jay will be way off the mark. (I hope)
,,,,,,,
_______________ooo___(_O O_)___ooo_______________
(_)
jim blair (jeb...@facstaff.wisc.edu) Madison Wisconsin
USA. This message was brought to you using biodegradable
binary bits, and 100% recycled bandwidth. For a good time
call: http://www.geocities.com/capitolhill/4834
susupply
<ro...@telus.net>
Stunned that someone actually pays attention to what he writes,
wrote in message news:40ce979f...@news.telus.net...
> Here's another fine example of Patrick's astonishing gift for
> dishonest context-chopping. Read and learn what true commitment to
> deceitfulness really is.
Oh, they'll learn oodles about "deceitfulness", all right.
[snip]
> >Moron, your claim was that the PRIMARY cause of price increases after the
> >early 1970s was:
> >
> >> >> >> ...primarily
> >> >> >>because the fraction of current oil supply that can be extracted
at
> >> >> >>such very low cost has been declining.
> >
> >YOUR SOURCE
>
> <yawn> Oh, grow up, little boy. I provided a source of historical
> price charts that proved I was right about the direction of prices and
> Grinch was wrong.
In fact, the chart showed it was you were wrong about consistently declining
prices for 100 years. And (by presenting the geo-political context for the
rises) that you were also wrong about the reasons for the price increases in
1973 and after.
> I did not say I bought into everything on the site.
> Much of it makes no sense, like the silly idea of averaging the price
> of oil over half a century as a guide to future prices (which you so
> hilariously embraced).
But, it does make sense to use geo-political anomalies--which are so labeled
for your convenience--as a guide?
> >says it was OPEC using the Israeli war of 1973 as an excuse for
> >an embargo, the Iranian revolution, and the Iraq-Iran war of the early
'80s.
> >Which is what Grinch told you.
>
> <yawn> The Iran-Iraq war, the last of those events, has been over for
> like 15 years. Oil is flirting with $40/bbl. You are destroyed.
And, your evidence is what for the cause being: "because the fraction of
current oil supply that can be extracted at such very low cost has been
declining"?
[snip of Roy's brazen attempt to deny that $15.25 per barrel is price data]
> >Neither mild, nor wild, inflation means "declining real prices".
>
> ??? Uh, it does when the nominal prices don't rise at least as fast
> as the inflation.
Nominal prices ARE the measure of inflation, idiot.
[snip]
> >Your story was:
> >
> >> ...for over 100 years up until the early 1970s, real oil
> >>>prices fell pretty consistently
> >
> >From 1958 to 1970 is TWELVE YEARS, Mensa Breath.
>
> You have simply taken that statement from a different context and
> falsely claimed I made it in this context. That sort of cheap,
> despicable deceit is a favored technique you use when you need to
> cover up one of your lies with another lie.
Yes, how unfair of me to actually use your own words in debating you.
Especially when they show you only off by 88 years out of 100.
[snip]
> >Second, the above, along with:
> >
> >> ><< Crises in Iran and Iraq
> >> ><< Events in Iran and Iraq led to another round of crude oil price
> >increases
> >> >in 1979 and 1980. >>
> >
> > is a refutation of your claim that it was due "primarily" to "the
fraction
> >of current oil supply that can be extracted at very low cost has been
> >declining". YOUR SOURCE has destroyed that argument.
>
> No, lying filth, it simply places a different emphasis on the causes
> of the price increases...
Yeah, yeah...that's the ticket: "a different emphasis" sounds a lot better
than, "I'm toast".
Grinch
On Mon, 14 Jun 2004 01:46:36 GMT, ro...@telus.net first asked to be
re-introduced to the concept of"'rent seeking", then finally and
kindly provided a trend line for us clinching the case made in the
first post in this thread. Finis, the end, and thank you very much
sir!
1970: $16.47 per barrel
1998: $14.00 per barrel (2004 dollars)
OK, so let me read you more carefully.
When you wrote: "since the early 1970s, real oil prices have risen"
What you *meant* was: "since the early 1970s, real oil prices have
risen and then fallen too so by the late 1990s they were at a level
below what they were even before the rise started .... thus
demonstrating a trend ever upward from 1970!"
I gotcha. We understand each other now.
> And
>I did not say the price rise since then had been steady, liar. And I
>did not say the end-point of oil price history had been reached in
>1998, liar.
Well, no ... but now you do seem to need to say 1998 was the
start-point of the rise you said started in the early 1970s, eh?
Or maybe 2000 was -- since, after all, prices had to get back to up to
the 1970 level first to rise from there.
>>And you are as in tune with the real world as ever.
>
>Unlike you, for example....?
>
>>If you think oil prices have risen steadily from $70 to $14, I guess
>>this explains your curious ideas about returns to real estate.;-)
>
>Right. You have chosen to lie about what I wrote, as usual, and
>insert the word, "steadily," which I did not say. "Steadily" would
>more accurately be applied to how oil prices declined from about the
>1880s to 1972 (though that decline was also by no means monotonic due
>to wars, financial panics, etc.). What was _really_ steady was the
>price decline between about 1957 and 1972. Prices since then have
>been far more volatile, but the trend has certainly been up. Which is
>why I did not say they had risen "steadily." And why, as usual, you
>had to lie about what I had written in order to have anything to say
>about it at all.
>
>>> in part because of geopolitical events but primarily
>>>because the fraction of current oil supply that can be extracted at
>>>such very low cost has been declining.
>>
>>So let's see ... after steadily falling for 100+ years -- in spite of
>>the cheapest oil being extracted and consumed first all the time at
>>steadily increasing rates, of course
>
>Right, because for most of that time, "cheapest" just meant "closest
>to the required infrastructure," not "easiest to extract" in any
>fundamental geological sense.
You just love making stuff up, eh?
That's why the oil business started in Pennsylvania, where they could
kick a dune with a boot and get oil with 1850s tech, because "easiest
to extract" had nothing to do with it.
And, of course, oil companies would *never think* of placing required
infrastructure *where* oil was easiest to extract!
They just set their infrastructure up where it was more costly and
extracted near it, figuring they could always cut costs in the next
century! ;-)
But in any event, *whatever* definition of "cheapest" you want to use,
even *yours*, I'm glad you agree that the **cheapest was used first
and yet real prices fell** for over 100 years.
Interesting, that.
>>consisting of a doubling of price in *one year* in 1973.
>>
>>Hey, do the words "cartel" and "embargo" mean anything to you, Roy?
>
>Yes. That might even be why I mentioned geopolitical events...
Oh, but only as a mere secondary influence. You wrote....
"...since the early 1970s, real oil prices have risen (as I said,
and you denied) in part because of geopolitical events
but primarily because the fraction of current oil supply that can be
^^^^^^^^^^^^^^^^^^^^^
extracted at such very low cost has been declining."
OK, now I don't wan't you to accuse me of mangling your dates again,
so do please clarify:
Was the increase that was "_primarily because_ the fraction of current
oil supply that can be extracted at such very low cost has been
declining"
a) The increase to $70 in 1981 from $16.47 in 1970?
or
b) The increase to $14 in 1998 from $16.47 in 1970, which occurred
after all that "geopolitical" stuff in the '70s and '80s settled out
and OPEC's rent collecting market power declined?
I'm trying to get my primary causes straight here. ;-)
>>I mean, you are so sensitive to "rent seeking" in some obscure cases,
>
>??? "Obscure"? Intellectual property is "obscure"? Landowning is
>"obscure"? Union monopoly privileges are "obscure"?
>
>>but when an new cartel arises and sends out press releases and hits
>>you over the head with a rent-seeking stick, doubling prices
>>immediately, *this* is a normal steady rise due to an erosion of
>>primary supplies. ;-)
>
>Which of course I never said, nor implied.
>
>):^|
Well, you said the "primary cause" of the rise after 1970 was *not*
rent seeking by those OPEC fellows but rising cost of getting the
stuff out of the ground.
And really, the rise that most people remember is to $70.
So some might draw an implication there.
Of course, if you meant the rise to $14 from $16.47 in OPEC's last
period of political weakness, as that better reflected a
non-manipulated market price, that's something else.
>>So, here is the **real world** scenario:
>>
>>Prices steadily fall all the way for 130 years to effectively an
>>*all-time low* in 1998
>
>Garbage. The all-time low was reached in the early 1930s, not
>surprisingly to anyone but you, and the decline from the 1860s to the
>1880s, for example, was by no means steady.
>
>>-- the *only* interruption in the price fall
>>being two *brief* sharp spikes up do to "geopolitical events".
>
>Ridiculous. Please try to educate yourself, or at least to be a
>little more honest and respectful of your readers, and not assume they
>will be fooled by such transparent lies.
>
>The long-term world oil price charts at
>
>http://www.wtrg.com/prices.htm
>
>prove that your claims are flat false.
Bwah! ha! ha!
Roy, you've got to learn to read your own authorities before posting
them.
"Until the March 28, 2000 adoption of the $22-$28 price band for the
OPEC basket of crude,.."
That is, a new round of RENT SEEKING
"... oil prices only exceeded $22.00 per barrel in response to war or
conflict in the Middle East. "
It's taken *war* to get prices up (and what have we got now?
Terrorists attacking is Saudi Arabia et.al.? Is that "geopolitical" in
your book? )
Continuing with your preferred authority....
"The Very Long Term View
"If long term history is a guide, those in the upstream segment of the
crude oil industry should structure their business to be able to
operate with a profit, below $15.28 per barrel half of the time..."
What??? Hey, that's *half* of what prices are now!
*Your authority* says that. Kudos!
BTW, looking though that page I don't see any support *at all* for
your claims prices being driven up because of rising extraction costs,
eh? Do you??
Projecting a profitable $15.28/b into the future, *your authority*
there is taking the "very long term view" that the cost of oil is
going to stay the same as it's been.
But if I'm missing somewhere where *your authority* agrees with *you*
by it predicting higher extraction costs will lead to continually
increasing real cost, do please note it!
;-)
Also, those charts seem to have been too complex and confusing for you
to read clearly.
Here's a nice simple clear one you might enjoy.
http://www.eia.doe.gov/emeu/25opec/sld010.htm
>>And at the end this time reserves are at an *all time high*
>
>Reserves by what definition? Are you not even a tiny bit skeptical
>about reserve figures showing no increase in reserves from 1970 to
>1985, and then a near-50% increase over the next few years, despite
>_fewer_ new field discoveries? Are you unaware that OPEC rewards
>increases in its members' reported reserves with increases in
>production quotas?
Hey, Roy, aren't you even *more* skeptical about the 177 billion in
proven reserves that just appeared in your own Alberta up there, with
*no* new discovery at all!!!
And there's 700k barrels a day coming from there right now, and going
into your gas tank, where *none* existed before!
It's magic! Magic, I say!!
Or maybe it's technology. Which brings up a point:
Now you're the Master of Data. And you've said *yourself* that
reserves go *up* with price.
Tell us a piece of data, now: What's the average productivity
increase in extraction technology in this industry??
You know, as in: "with a 2% productivity increase we can extract for
$0.98 this year what cost $1.00 last year"
Give us an estimate. If it's 2% then in 50 years the industry will be
able to extract for $0.36, and in 100 years for $0.13, what it
extracts at a cost of $1 now.
Or if the rate is 3% -- more realistic for manufacturing and minerals
generally -- it will be able to extract for $0.22 in 50 years and
$0.05 in 100 years, what it does for $1.00 now.
Would you take 3%?.
So, 0.36 to 0.05 give multiples of from about 3 to 20.
Now, as I've already pointed out, we've already had a seven-year >4%
growth boom with oil at $55 barrel adjusted for inflation and
intensity of use.
Give us a guess: From all sources, what do you imagine total oil
reserves might be at from $165 to $1,100 per barrel?
Because over the long run, 50 to 100 years, productivity gains of 2%
to 3% will make such reserves available a real cost no higher than we
paid during the "seven fat years" boom of the 1980s.
Now remember, there's *six times* as much oil as is in all of Saudi
Arabia in just *one* oil sands field. And then there is coal, tar
sands, natural gas ... even conventional oil! I bet at a few hundred
dollars a barrel even conventional reserves would go up some, eh?
What do ya think? Give us a number for the productivity increase
first.
Really, we get 177 billion of 1.6 trillion barrels in Athabasca at a
mere $15/b production cost.
How many billion more at the equivalent of maybe $100/b. Or $500/b?
How many Saudi Arabias might come out of Athabasca. Two? Three?
>......
>...Almost all of which increase in reserves occurred in the late 1980s
>for political reasons, and represents upward revisions of the reserves
>in known fields, not new field discoveries. The chart at the bottom
>of
>
>http://wwwistp.murdoch.edu.au/teaching/N212/n212content/topics/topic5/03worldoilgas.html
>
>is quite revealing on that score.
It's magic! I tell you, magic!
Of course, as Asimov said, the effects of technology always appear as
magic to the naive.
>>>>Although admittedly the geocentric solar system agreed much better
>>>>with empirical observations of reality.
>>>
>>>What has happened to the real price of oil over the last 35 years,
>>>Grinch? How about over the last 20 years?
>>
>>20 years:
>>
>>1984: $52 per barrel (2004 dollars)
>>2004: $34 per barrel (average through May)
>>
>>You know, Roy, for a guy with such strong opinions you don't actually
>>*know* anything. Eh?
>
>?? Oh, dear...
>
>It seems you slightly misunderstood what I was asking.
What happened to the price of oil over the last 20 years??
It fell.
Admittedly the numbers I gave above understate how far it fell and for
how long, by giving as the end point the recent five month demand
spike up to $34.
Numbers can be misleading that way.
> A starting
>price and an ending price do not say what has happened to the price
>_over_ the period. Oil peaked a little over 20 years ago, at real
>prices it hadn't seen in 100 years, and then fell to a 1988 _low_
>about _50%_higher_than_ its average price in the ten years to 1973.
>It then rose and fell quite substantially, and at its 1998 minimum
>(triggered by the 1997 East Asian financial panic) _briefly_touched_
>the levels it had been at for a solid _decade_ up to 1973.
You mean it fell to 15% below what it was in the early 1970s which
*you* said was the low price point culminating the long decline.
Then we get it rocketing up in 1974, and again in 1980-81
Which *primarily* reflected true increased cost and scarcity, you say,
eh? ;-)
While the 20-year decline after the political events up to '81 passed
-- as OPEC lost its clout and RENT SEEKING ABILITY -- to *below* what
the price was in the pre-73, that was just an aberration. ;-)
BTW, you might re-read your own source there about how OPEC's rent
seeking ability faltered up to that time.
When rent-seeling diminishes, what do you expect to happen to price?
Might it go nearer its natural level?
> Since that
>_very_brief_ 1998 minimum, it has of course soared to _sustained_ real
>prices far above the _sustained_ prices of the pre-1973 era.
You mean, as *your source* said, OPEC then organized a new round of
rent seeking -- do you know what that is? -- to get the price up.
>Now, as for the 35-year price history, for which you not so
>unexpectedly declined to proved any response at all, you are of course
>aware that the price from 1969 to 1973 was _always_ far below the
>average price since then,
The "average price" ???? Hello??
Roy ... how does a bout of $70 a barrel from rent seeking and embargo
affect *average* price?
Personally, I look to determine market prices when rent seeking is
low.
You do know how rent seeking affects price, eh?
Ever heard of that??
Hey ... now if you *really really* think that $70 a barrel oil
resulted *primarily* from supply constraint and increasing extraction
cost, then you have the little problem of explaining how it fell over
the next 20 years to $14. An 80% fall over 20 years ain't an
aberration!
But *if* you think that prices were pushed up to $70 by "geopolitics",
conflict, and rent seeking -- and then nonetheless, knowing that, you
claim that an "average price" including the numbers for that period
reflect true free market conditions and resource availability, then
*you*, sir, are a ... yes .... liar! liar! liar!
Pants on fire! liar! liar! liar!
Or a dimwit.
Pathetic.
>and that the low price attained for about 15
>minutes in 1998 has been followed by much more typical -- i.e., much
>higher -- post-1973 prices.
>
>>I mean, personally, before I went on and on with all these price
>>claims I'd *check them* to make sure I wasn't making an ass of myself.
>
><snicker> No, you wouldn't. You didn't. And _you_ consequently
>_have_ made an ass of yourself.
ROTFLMAO. ;-)
I *read* my sources, Roy.
And I read *your* sources too. The way they agree with me, it's a
pleasure!
>
>>BTW,the quality of all your empirical claims re Georgism and land
>>values and all that stuff is really being confirmed for us here.
>
>Indeed. Look at the price charts at the url I gave above, especially
>the 1867-2003 chart. The general accuracy of my description of how
>oil prices have changed over time, and the falsehood and dishonesty of
>your description, are perfectly evident.
>
>>>>Meanwhile, we're all still waiting for our first observation of a
>>>>mineral resource rising in price perpetually (much less running out)
>>>>due to scarcity as a result of humanity's consumption of it.
>>>
>>>Do you or do you not understand that the real price of oil fell until
>>>about 1970, and has been rising since then?
>>
>>1970: $16.47 per barrel
>>1998: $14.00 per barrel (2004 dollars)
>>
>>Does "rising" have a different meaning in Canada?
>
>2004: $40/bbl. Does "since then" have a different meaning in what you
>are no doubt pleased to call your "brain"?
Bwah! Ha! Ha! Ha!
In Canada "since 1970" means "in 2004"!!
ROTFLMAO! ;-)
>>>Don't you think 35 years
>>>is enough to establish a trend?
>>
>>I'd say about 140 years through 1998 probably constitutes a trend.
>
>Uh-huh. But only if you ignore what has happened in all the years
>since 1973, aside from 1998...
>
>>And looking at things another way...
>>
>>1981: $70 per barrel
>
>A peak it had not seen for 100 years...
>
>>2003: $21 per barrel
>>
>>... I'd probably say that 22 years constitutes a trend too.
>
>Oh? What happened to the $16.47/bbl in 1970 that you seemed to be
>aware of just a few lines up? Or any of the other
>_sustained_low_prices_ before 1973?
What happened in 1973, Roy?
Could it have been RENT SEEKING??
Bwah! ha!
Did you read your own source about 1973-81???
Hey, would your recognize of case of rent seeking if it came dressed
as Momma Cass (instead of a landlord) and *sat on your head*??
BTW, isn't it just an *amazing coincidence* how you figure that after
130 years of general decline, extraction costs started their
inevitable rise at the *exact same time* as this cartel, C-A-R-T-E-L,
got together and began engaging in massive RENT SEEKING.
What a coincidence, eh? Really, the inevitable rise of extraction
costs could have begun on any one of 150 other years. What were the
odds?
Today the Saudis are sitting on 260 billion barrels of oil that they
can extract for a cost as little as $2/barrel, keeping it *off the
market* to jack up prices ... and the problem keeping prices up is
there's no oil left in the world with low extraction cost!!!!
Ha! Ha! Ha!
>>Compared to *that*, do you think a one year price spike constitutes a
>>trend?
>
>Look at the chart, Grinch. And you evidently think a one-year price
>_dip_ constitutes a trend...
What's the one year dip? 1970 to 1998, or 1981 to 1998?
Geeze -- you quote $40/b in support of a "trend"... and that didn't
last even *one month*!
Bwah!
>>Roy, it looks to me like your long-term "trends" consist entirely of
>>the three years 1973, 1981 and 2004 ...
>
>Look at the chart, liar.
Ok, OK. Hmmm... I see two huge spikes from *rent seeking* in 1973 and
1981, and down, down, down otherwise to $14 in 1998.
Then I see a rise all the way back to $20 in 2001 -- no higher than it
was in 1949 -- which rise had to be manipulated through another round
of *rent seeking*, well, at least according to *your authority*
Then I see price bouncing around there for three years ($21 in 2002)
followed by a *price spike* in 2004 when *simultaneously*, the
economies of the US, Japan., China and India boom, there is a war in
the Mideast and terrorists striking the oil industry in Saudi Arabia
What do you see?
>>with all the rest of the last
>>140 years being various short-term aberrations off trend. ;-)
>
>Look at the chart, liar. The long-term downtrend ended in 1973. Deal
>with it.
>
>>>>But as long as one ignores the total lack of all empirical evidence
>>>>needed to confirm it, the theory looks great!
>>>
>>>The real oil prices over the last 35 years are a total lack of
>>>empirical evidence?
>>
>>Roy, you are *so funny*.
>
>ROTFL!! Grinch, you are _so_stupid_. You ducked and dodged and ran
>away whimpering like a frightened little boy when I asked you what oil
>prices had done over the last 35 years.
Bah! ha! ha! ROTFLMAO;-)
Roy, you're as much fun as those old Bugs Bunny cartoons. The good
ones from the 1940s. You remind me of Elmer -- you're gonna get that
waskally wabbit with your rifle ... someday!
> Now's your chance to act like
>a man for a change, and you blow it again. How sad.
>
>>Really, why didn't you check the price numbers before going on and on
>>about them like this?
>
>I have. Look at the price chart, Grinch.
>
>>Now here's a question for you:
>>
>>Three years ago there was a big milk surplus down here, and a
>>recession too, prices fell real low, so a lot of farmers got rid of
>>their milk cows and went into something else.
>>
>>This year there is a *boom* and milk demand is *way up* -- and the
>>price of a gallon of milk has risen by *much more* than that of a
>>gallon of gasoline! It's true!! And with summer the price of ice
>>cream has shot up even more than that!! You can look it up!
>>
>>Now, reading the "trend" of this one-year price spike and its deeper
>>meaning, do you conclude the nation is finally and forever running out
>>of cows?
>
>One year does not make a trend
Right! And *one month* at $40, does not make a trend.
And *five months* averaging $34 does not make a trend.
>-- not even 1998, unfortunately for
>you.
But...
1949: $20.
1998: $14.
Or since you don't like that how about...
1949: $20
2002: $22.50
Which is after *your source*, thank you very much, says OPEC organized
a new round of RENT SEEKING.
Very impressive **up trend** there, over 53 years, with **a cartel
pushing up the price at the end**, eh?
Extraction costs must be really zooming!
> Contrary to your claims, 1998 was not the last year oil would
>ever have a price, and the _momentary_ bottom touched in that year
>(which, contrary to your claims, was not the all-time low -- that was
>reached in the early 1930s)
In the Great Depression? Was that because extraction costs fell? ;-)
I know! I know!
I just enjoyed it so much I had to repeat it. ;-)
>>Are you saying that they *could* provide a few days worth?
>
>No. Why do you feel you always have to lie about what I write? I'm
>not sure exactly how much energy there is in all the whale oil
>remaining in the world, but it's certainly no more than a few days'
>petroleum consumption worth.
>
>The point is, you said the experts who said the world was running out
>of whales and could not continue to use them as a source of energy for
>very much longer were not looking at the facts. But they were. They
>were right.
No, they were *wrong*
Better brush up on that reading comprehension for the Mensa renewal.
(Notice I am not saying you *lie* about what I wrote, just that you
have trouble with comprehension. I'm a nice guy.)
What I *said* was that the experts predicted fuel prices would rise
and supplies would fall "bringing the Industrial Revolution to a
grinding halt" because the wales *would* be killed off and coal
*would* run out in Britain.
But the wales were *not* killed off, Britain did *not* run out of
coal, and rising prices did *not* bring the Industrial Revolution to a
grinding halt, it continued on rather notably well. Zero for three.
Now, what have we learned?
We learn that those experts, like you, thought *only* of marginal cost
of extraction presuming it to rise in money terms, and of diminishment
of fixed supply.
They did *not* consider innovation in extraction which continually
reduces its cost making the expensive cheap and increasing supply, nor
innovation in use which reduces demand, nor innovation in substitution
which both increases supply and reduces demand.
E.g, they thought petroleum was f***ing unusable, and drilling it out
of the ground was a ludicrous notion.
"Drill for oil? You mean drill into the ground to try and find oil?
You're crazy."
-- famous response of drillers recruited by Edward Drake for the first
oil well project, popularly known as "Drake's folly".
OK, it may be understandable that back then people believed there was
no substitute for whale oil or cheap coal, ergo they *had* to run out
-- because those people never saw substitutes for such things.
But today it is just plain STUPID to think there are no ready
substitutes for cheap pumped oil at economic prices, because two major
economies have *already run* quite competitively on oil from non-oil,
and oil from Athabasca is going into your car right now. So how dim is
that?
In 120 years' times there's going to be no substitute for oil in
fueling transport -- just like we today have no substitute for the
horse feed of 120 years ago?
The USGS says there's 80 years of conventional oil left with a
probable production peak around 2040 or so.
Gee, do you suppose that deca-trillions of barrels of oil in tar
sands, coal, natural gas, etc and so on, might be able to produce
enough to cover that gap, as technology makes economic extraction of
reserves that we'd think of as having a cost of $165 to $1,100 a
barrel today?
Especially being that entire economies have *already* run on the
stuff?
>>>> bringing the Industrial
>>>>Revolution to a grinding halt.
>
>>Let me just say that it is a very good thing that we do have "markets"
>>that operate with much competition which provides incentives for good
>>things like continuous innovation and increased productivity and cost
>>reduction and efficient substitution ... so that when it *came down to
>>it*, we didn't have to -- and weren't even tempted to -- build our
>>modern 21st Century economy entirely on whale oil.
>>
>>We can agree on that, eh?
>
>Yes, because for once, you did not lie about what I wrote.
>
>>Now I leave you with one final question to ponder:
>>
>>1949: $20.06 per barrel
>
>I note that this was the peak price recorded any time between 1927 and
>1973...
>
>>1970: $16.47 per barrel
>>1998: $14.00 per barrel (2004 dollars)
>
>And this was of course the _lowest_ price recorded any time since
>1973...
>
>>Trend or not?
>
>Certainly these data demonstrate a trend: your unmistakable trend to
>dishonestly presenting cherry-picked data, on the few occasions you
>present any data at all.
Yeah, ain't it remarkable how one can cherry pick data from recent
years showing prices in the same ballpark or less than the $20/b of 55
years ago? 1994: $20 1999: $20 2001: $23 .... I mean, being that
the price trending has been *up* for *so long*, with extraction
costs relentlessly rising?
You know, realizing that there's been a CARTEL engaged in RENT SEEKING
by forcing up the price artificially in recent years, it really is!!!
>
>Look, just go to the price charts at http://www.wtrg.com/prices.htm,
>Grinch, and tell us what you see. And for once in your life, try to
>be honest.
>
>Oh, and I'll leave you with a question:
>
>1932: $9/bbl
>1968: $18/bbl
>2004: $36/bbl (2004 dollars)
>
>Your cherry-picked data showed a price decline of 30% in 50 years.
No, Roy, wrong again.
Mine showed *no significant rising trend*, especially not one due to
scarcity or extraction cost after counting for the effects of the
*rent seekers*.
I neither claim nor care about a falling trend.
My only concern -- as expressed *extensively* in the first post of
this thread, if you actually trouble to recall -- is that oil stay
under $55 a barrel or so, adjusted upward for continuing decline in
use in proportion to GDP.
As long as that condition holds oil will be no more a burden on the
economy than it was during the "seven fat years" of the 1980s when
growth averaged over 4% annually.
In other words,we will have "cheap oil" whatever its nominal dollar
price, it will be no problem.
And my only claim is that it is extremely possible, to the point of
being self-evident so. That was the point of the original post.
To refute that you will have to credibly show that oil prices must be
be *expected* to rise at a rate to breech the
$55-adjusted-for-intensity-of use number --- and that this will occur
due to *scarcity*, not due to politics, war, rent seeking, a meteor
hitting Saudi Arabia, or whatever.
I couldn't care less about the price of oil rising less than that, or
falling, or whatever price action may occur -- so long as cost stays
below that amount.
>data are not cherry-picked. I just chose the all-time low price, and
>the most recent price, and the price at a date midway between those
>times.
Bwah! ha! ha!
"Not cherry picked" he says, projecting a straight-line trend from a
Great Depression all-time low to a boom & rent seeking 19-year high!
Just for the record, when you are *really* not cherry picking you run
a trend line from one cyclical high to another cyclical high, or from
a cyclical low to another cyclical low.
That'd be $9 to $14 in 72 years.
But just for fun, let's use *your* numbers.
> And _those_ data show a price _increase_ of _300%_ over _72_
>years.
Ooooooh. All-time low to 19-year high, that's an impressive 1.9% per
year!
>Trend or not?
Yes indeed it is! I accept it as so, and will project it into the
future.
In the 30 years since 1973, when oil prices indeed had a big hike --
although *possibly* due to rent seeking behavior by suppliers rather
than sudden rising extraction cost -- real GDP has grown 3% per year
average while oil consumption in barrels has increased 0.5% per year
average.
E.g.: http://www.eia.doe.gov/emeu/aer/txt/ptb0501.html
Now if we add your cherry-pickin' from-1932 1.9% increase in real
price per barrel annually to the 0.5% increase in barrels consumed
annually, we get a 2.4% increase in total real dollar cost of oil
annually.
Compared to a 3% increase in real GDP annually.
So our *trend* is ....
Constantly Diminishing Cost of Oil in terms of GDP!
Thank you very much, sir! You have made my case for me in the best
terms possible, with your Depression-low to 19-year high trend line
and all.
Merci!
>-- Roy L
Grinch
>Here's another fine example of Patrick's astonishing gift for
>dishonest context-chopping. Read and learn what true commitment to
>deceitfulness really is.
>
>On Mon, 14 Jun 2004 23:57:53 GMT, "susupply" <susu...@mindspring.com>
>wrote:
>>...
>> is a refutation of your claim that it was due "primarily" to "the fraction
>>of current oil supply that can be extracted at very low cost has been
>>declining". YOUR SOURCE has destroyed that argument.
>
>No, lying filth, it simply places a different emphasis on the causes
>of the price increases ...
Yes ... a 100% different emphasis. ;-)
>that proved I was right and Grinch was wrong.
Bah! ha! ha!
>Of course the 1973 embargo, the Iran revolution and other events
>caused large price increases. That's why I mentioned "geopolitical
>events." Remember? But such events cannot explain why prices have
>been higher, and usually _much_ higher, for three decades running,
"Cartel" ... C-A-R-T-E-L
Did the cartel disband in 1975 and again in 1983? Nooo...
And many people associate it with the concept of *rent seeking*.
I.e., of managing prices *upward* above free market prices.
Especially when IT PUBLICLY SAYS THAT IS WHAT IT IS DOING.
The idea that this may be an explanation for above-market prices over
a period of time may be new and unfamiliar to you, since you seem to
think it "cannot explain" such a thing.
In which case I recommend:
(1) You get an economcis text and look up the terms "cartel" and "rent
seeking", and
(2) Read the source *you posted* and its explanation of how the CARTEL
has managed oil prices "since the early 1970s" as you like to say, and
how its strength rose and fell at different times, that being
*reflected in prices*.
Hey, maybe it'll be easier for you if you think of the cartel as a
bunch of *landlords* owning oil-producing land and rent-seeking the
price up!
Btw, Roy, if you can find ANYTHING in that source that YOU POSTED that
supports your claim (much less "proves you right" bah! ha! ha!) AT
ALL by mentioning rising extraction costs, please quote it 'cause we
missed it.
Please do include the part where it mentions the stunning coincidence
of how extraction costs stopped their 100 year decline and began their
inevitable rise at *exactly* the same time as the cartel started
managing prices.
Who'd ever have predicted that? ;-)
ro...@telus.net
wrote:
>Since this is all in real dollars,
No. Patrick's quoted statement was about the _nominal_ price
fluctuating between $2 and $3.
>Your statement:
>
>>... The chart shows _real_ prices declining over the
>>same period, which makes sense, if you are intelligent and
>>knowledgeable enough (hint: you're not) to realize that there was mild
>>inflation over that period,(1948-60) resulting in declining real prices.
>
>does not make sense. Declining real oil prices were not a result of mild
>inflation: they COULD have gone either way.
_No_. _Not_ given the $2-$3 price quote that Patrick falsely claimed
_contradicted_ my statement.
>And is it the *real* price
>which counts? Or is it the price relative to incomes?
Well, at least we know it isn't the nominal price that counts.
>Anyway the issue here is not the past oil price trend, but the future. I
>am reminded of a past 3 way exchange with Jay Hanson and Grinch. (which
>may not have been posted since I can't find it with a Google search :-(
>but was in about 1998. Jay said we would soon run out of oil and all die
>off.
Now that's dumb.
>Grinch said energy prices have been declining for the last 300 years
>and they would likely continue to drop.
That is probably true (labor price, anyway), but does not mean the
real price of _oil_ will continue the kind of trend it showed up to
1973.
>I say my prediction has been the closest. Energy prices will likely drop
>in the more distant future as substitutes for oil are brought on line.
Agreed.
>Probably hydrogen made fron water using wind, solar or nuclear energy.
Disagree. Hydrogen is just a form of energy storage (and not a very
convenient one), not an energy source -- unless you are talking about
fusion, which is still very much a drawing-board technology.
>Grinch will be correct in that "long run", but not for the next decade.
I'm not even sure of that. Oil is one thing, energy is something
else. I see Sony or NEC or somebody has just come out with a new
cheap and efficient PV technology. A real PV breakthrough _could_
take so much pressure off oil that its price increases would stop and
even reverse.
>And Jay will be way off the mark.
Not much doubt of that.
-- Roy L
ro...@telus.net
wrote:
><ro...@telus.net>
>
>Stunned that someone actually pays attention to what he writes,
>
> wrote in message news:40ce979f...@news.telus.net...
>> Here's another fine example of Patrick's astonishing gift for
>> dishonest context-chopping. Read and learn what true commitment to
>> deceitfulness really is.
>
>Oh, they'll learn oodles about "deceitfulness", all right.
Thank you for admitting it.
>> >Moron, your claim was that the PRIMARY cause of price increases after the
>> >early 1970s was:
>> >
>> >> >> >> ...primarily
>> >> >> >>because the fraction of current oil supply that can be extracted
>at
>> >> >> >>such very low cost has been declining.
>> >
>> >YOUR SOURCE
>>
>> <yawn> Oh, grow up, little boy. I provided a source of historical
>> price charts that proved I was right about the direction of prices and
>> Grinch was wrong.
>
>In fact, the chart showed it was you were wrong about consistently declining
>prices for 100 years.
Nope. I said _pretty_ consistently. And if you factor out the
transient effects of wars, financial panics, etc. that is what
happened.
>And (by presenting the geo-political context for the
>rises) that you were also wrong about the reasons for the price increases in
>1973 and after.
"Geopolitical events" is wrong?
>> I did not say I bought into everything on the site.
>> Much of it makes no sense, like the silly idea of averaging the price
>> of oil over half a century as a guide to future prices (which you so
>> hilariously embraced).
>
>But, it does make sense to use geo-political anomalies--which are so labeled
>for your convenience--as a guide?
No, as an _explanation_ for the associated price anomalies. Such
events cannot be a guide to future prices, as future political events
are not predictable.
>> >says it was OPEC using the Israeli war of 1973 as an excuse for
>> >an embargo, the Iranian revolution, and the Iraq-Iran war of the early
>'80s.
>> >Which is what Grinch told you.
>>
>> <yawn> The Iran-Iraq war, the last of those events, has been over for
>> like 15 years. Oil is flirting with $40/bbl. You are destroyed.
>
>And, your evidence is what for the cause being: "because the fraction of
>current oil supply that can be extracted at such very low cost has been
>declining"?
That is certainly a fact, and a major factor. OPEC is simply not the
dominant factor it was in the 70s. Current industry analysis holds
that OPEC is not capable of controling its members' production levels,
and hasn't been for decades.
>[snip of Roy's brazen attempt to deny that $15.25 per barrel is price data]
You mean snip the proof of your lying.
>> >Neither mild, nor wild, inflation means "declining real prices".
>>
>> ??? Uh, it does when the nominal prices don't rise at least as fast
>> as the inflation.
>
>Nominal prices ARE the measure of inflation, idiot.
Nominal _oil_ prices (which of course was what we were talking about,
context-snipping breath) are _not_ the measure of inflation.
You are destroyed.
>> >Your story was:
>> >
>> >> ...for over 100 years up until the early 1970s, real oil
>> >>>prices fell pretty consistently
>> >
>> >From 1958 to 1970 is TWELVE YEARS, Mensa Breath.
>>
>> You have simply taken that statement from a different context and
>> falsely claimed I made it in this context. That sort of cheap,
>> despicable deceit is a favored technique you use when you need to
>> cover up one of your lies with another lie.
>
>Yes, how unfair of me to actually use your own words in debating you.
That is your standard excuse for your dishonest context-chopping.
Anyone reading this is invited to re-read the whole thread and verify
for himself that Patrick has dishonestly cut and pasted my words to
alter their context in a way calculated to deceive his readers.
-- Roy L
ro...@telus.net
wrote:
>On Tue, 15 Jun 2004 07:23:18 GMT, ro...@telus.net wrote:
>
>>Here's another fine example of Patrick's astonishing gift for
>>dishonest context-chopping. Read and learn what true commitment to
>>deceitfulness really is.
>>
>>On Mon, 14 Jun 2004 23:57:53 GMT, "susupply" <susu...@mindspring.com>
>>wrote:
>
>>>...
>>> is a refutation of your claim that it was due "primarily" to "the fraction
>>>of current oil supply that can be extracted at very low cost has been
>>>declining". YOUR SOURCE has destroyed that argument.
>>
>>No, lying filth, it simply places a different emphasis on the causes
>>of the price increases ...
>
>Yes ... a 100% different emphasis. ;-)
>
>>that proved I was right and Grinch was wrong.
The oil price charts I cited proved you wrong. Deal with it.
>>Of course the 1973 embargo, the Iran revolution and other events
>>caused large price increases. That's why I mentioned "geopolitical
>>events." Remember? But such events cannot explain why prices have
>>been higher, and usually _much_ higher, for three decades running,
>
>"Cartel" ... C-A-R-T-E-L
Wrong. Cartels don't work indefinitely, and industry observers agree
that OPEC's influence over prices, though huge in the 70s, had
declined to a derisory level by the mid-80s and has not recovered.
>Did the cartel disband in 1975 and again in 1983? Nooo...
It stopped working in about 1986.
>And many people associate it with the concept of *rent seeking*.
>
>I.e., of managing prices *upward* above free market prices.
>
>Especially when IT PUBLICLY SAYS THAT IS WHAT IT IS DOING.
Problem: if you knew any economics, you would know that such collusion
does not work for long.
>The idea that this may be an explanation for above-market prices over
>a period of time may be new and unfamiliar to you, since you seem to
>think it "cannot explain" such a thing.
At any rate, those who study the industry agree that it _does_ not
explain current prices.
>In which case I recommend:
>
>(1) You get an economcis text and look up the terms "cartel" and "rent
>seeking", and
Back atcha. And try to get a good one, one that explains why cartels
can't work for long.
>(2) Read the source *you posted* and its explanation of how the CARTEL
>has managed oil prices "since the early 1970s" as you like to say, and
>how its strength rose and fell at different times, that being
>*reflected in prices*.
It's strength rose very greatly in the 1970s, and then fell in the
1980s, and has not recovered. Which leaves you with some 'splainin'
to do wrt the recent $40/bbl oil prices.
>Hey, maybe it'll be easier for you if you think of the cartel as a
>bunch of *landlords* owning oil-producing land and rent-seeking the
>price up!
Landlords cannot increase land rents by colluding, because the supply
of land is fixed. The supply of oil is not fixed.
>Btw, Roy, if you can find ANYTHING in that source that YOU POSTED that
>supports your claim (much less "proves you right" bah! ha! ha!) AT
>ALL by mentioning rising extraction costs, please quote it 'cause we
>missed it.
<yawn> You seem to miss a lot of things. I posted that url merely to
prove that you were wrong about real oil prices. I did not claim that
all knowledge about the oil business was to be found there.
>Please do include the part where it mentions the stunning coincidence
>of how extraction costs stopped their 100 year decline and began their
>inevitable rise at *exactly* the same time as the cartel started
>managing prices.
>
>Who'd ever have predicted that? ;-)
Not me. And I didn't claim it, either. Liar.
-- Roy L
Robert J. Kolker
ro...@telus.net wrote:
> Disagree. Hydrogen is just a form of energy storage (and not a very
> convenient one), not an energy source -- unless you are talking about
> fusion, which is still very much a drawing-board technology.
Controlled economical hydrogen fusion has been 30 years in the future
for the last 50 years. I am sure it will remains so for at least the
next hundred years.
>
> I'm not even sure of that. Oil is one thing, energy is something
> else. I see Sony or NEC or somebody has just come out with a new
> cheap and efficient PV technology. A real PV breakthrough _could_
> take so much pressure off oil that its price increases would stop and
> even reverse.
Photovoltaic technology suffers from the obvious defect. We do not get
sunlight on demand except in certain very restricted areas. Furthermore
the energy from sunlight is very diffuse and must be concentrated into
useful quantities for industrial use. Sunlight, wind (which is
aderivative of sunlight) may very well be useful peak load suppliments,
but as a primary energy source is does not make the grade.
You baseline energy sources which provide energy in industrial quantity
on demand are hydrocarbon fuels, hydroelectric gravity sources (but high
head HE is also available only in a few areas), geothermal energy (the
up front costs of taping into the magma are very high) and fissile
nuclear energy which the eco-weenies hate and legislate against.
PV will not bump oil, natural gas or coal in the the forseeable future.
Bob Kolker
Dave Morrison
Despite your vehemence, you are totally unknowledgeable and almost no
worth responding to. Every point you made was wrong. It's as though
you have been living in a box since 1989 or so...
> (Remember the source is a free weekly hand-out downmarket from the
> Village Voice").
The NY Press is actually much more well-read and doing a lot better
journalism than the Voice these days. It's not the 1980s anymore.
> . it understated remaining oil supply by only a mere 2 trillion
> barrels as per the USGS
USGS numbers have been proven to be overly optimistic and
scientifically unsound time and time again. There are lots of good,
credible sources for this. You definitely should not take USGS numbers
at face value. They are trying to promote exploration.
> . somehow overlooked that there's six times as much oil in Canadian
> oil sands as in Saudi Arabia, and there are enough proven reserves in
> Alberta alone right now to meet North American import needs for the
> next 40 years.
The article was about the end of "cheap oil" not the end of oil in
general. Tar sands oil is most definitely not cheap. It's very
expensive to extract and is, in fact, only worth producing if light
sweet crude costs have run up to about $50/barrel. Tar sands and heavy
oils in Canada and elsewhere will most likely not prevent us from
peaking globally in the next ten years.
> .claimed oil keeps getting harder to find while neglecting to mention
> that the cost of finding each new barrel has dropped 75% in the last
> 20 years.
Not sure where you got that stat. In fact, we're having to go to
greater geological extremes to find ever-smaller reserves. The
economics of it are not good. It used to take something like 1 barrel
of energy to find 50 barrels of oil. Today it takes about 2.5 barrels
of energy to find one barrel of oil. You do the math.
> . claimed *all* projections, including the most optimistic, say
> production will peak by 2020 at the latest -- while the USGS and USEIA
> project the date at from 2037 - 2047 ... etc., etc.,
Data from both of these agencies is widly discredited by very
mainstream sources. Besides you're citing their most optimistic data.
> I could go on and on with the dumb-assedness in it -- frankly, proof
> of either incompetence or lying.
>
> But of course the Mother Dumbass Claim in it, compared to which the
> rest is all mere detail, is that there is *no substitute* for pumped
> oil -- as we can substitute bran for corn flakes -- so we must prepare
> for the coming production top "as seriously as for nuclear war"
> literally.
>
> *As if* Germany and South Africa hadn't already actually run their
> economies on oil-from-coal, and *as if* gasoline from Canadian oil
> sands isn't going into your car right now.
We are most definitely not going to be able to run the "American Way
of Life" as currently-configured with coal.
> And *as if* there isn't enough oil sands, coal, etc. and so on, to
> produce oil on the foreseeably desired scale for maybe another 1,000
> years, starting when those overlooked 2 trillion barrels should need
> topping off.
There is a lot of oil and fossil fuel left in the ground. But the
cheap stuff is dwindling fast.
Who do you work for?
susupply
<ro...@telus.net>
of the high school royls,
wrote in message news:40d005d5...@news.telus.net...
> >And, your evidence is what for the cause being: "because the fraction of
> >current oil supply that can be extracted at such very low cost has been
> >declining"?
>
> That is certainly a fact, and a major factor. OPEC is simply not the
> dominant factor it was in the 70s. Current industry analysis holds
> that OPEC is not capable of controling its members' production levels,
> and hasn't been for decades.
No, no. I didn't ask you to reiterate your belief. I asked you for the
evidence that your belief is correct.
Please learn--after all these years--to pay attention.
Jim Blair
>
>Controlled economical hydrogen fusion has been 30 years in the future
>for the last 50 years. I am sure it will remains so for at least the
>next hundred years.
Hi,
I am much more optimistic. I say fusion will be only 10 years in the
future for the next 100 years ;-)
Roy:
>>
>> I'm not even sure of that. Oil is one thing, energy is something
>> else. I see Sony or NEC or somebody has just come out with a new
>> cheap and efficient PV technology. A real PV breakthrough _could_
>> take so much pressure off oil that its price increases would stop and
>> even reverse.
Robert J. Kolker:
>
>Photovoltaic technology suffers from the obvious defect. We do not get
>sunlight on demand except in certain very restricted areas. Furthermore
>the energy from sunlight is very diffuse and must be concentrated into
>useful quantities for industrial use. Sunlight, wind (which is
>aderivative of sunlight) may very well be useful peak load suppliments,
>but as a primary energy source is does not make the grade.
>
>Your baseline energy sources which provide energy in industrial quantity
>on demand are hydrocarbon fuels, hydroelectric gravity sources (but high
>head HE is also available only in a few areas), geothermal energy (the
>up front costs of taping into the magma are very high) and fissile
>nuclear energy which the eco-weenies hate and legislate against.
>
>PV will not bump oil, natural gas or coal in the the forseeable future.
>
>Bob Kolker
>
PV or wind will bump oil natural gas or coal only if they are used to make
hydrogen from water, and the hydrogen is used to fuel transportaion and
replace natural gas. (and I would bet on wind over PV as of now)
Jim Blair
>On Tue, 15 Jun 2004 20:21:40 +0000 (UTC), Jim Blair <s...@sig.com>
>wrote:
>
>>Since this is all in real dollars,
Roy:
>
>No. Patrick's quoted statement was about the _nominal_ price
>fluctuating between $2 and $3.
>
>>Your statement:
>>
>>>... The chart shows _real_ prices declining over the
>>>same period, which makes sense, if you are intelligent and
>>>knowledgeable enough (hint: you're not) to realize that there was mild
>>>inflation over that period,(1948-60) resulting in declining real prices.
>>
>>does not make sense. Declining real oil prices were not a result of mild
>>inflation: they COULD have gone either way.
Roy:
>
>_No_. _Not_ given the $2-$3 price quote that Patrick falsely claimed
>_contradicted_ my statement.
Hi,
This semantic point is not worth continuming, except for one afterthought.
I said that the falling real price of oil was not CAUSED by low inflation,
as I thought you implied. I said the real price could have gone either way
during those years (1948-60).
But maybe not? One could argue that it was the stable and low price of
oil that resulted in the low inflation. And that the it was the unstable
supply of oil and irregular and increased oil prices of the 1970's that
(at least indirectly) caused the inflation. I had claimed that low
inflation and low stable oil prices are two independent variables. But I
can see that it could be claimed that they are related. Was that your
point?
>
>>And is it the *real* price
>>which counts? Or is it the price relative to incomes?
>
>Well, at least we know it isn't the nominal price that counts.
Yes.
>
>>Anyway the issue here is not the past oil price trend, but the future. I
>>am reminded of a past 3 way exchange with Jay Hanson and Grinch. (which
>>may not have been posted since I can't find it with a Google search :-(
>>but was in about 1998. Jay said we would soon run out of oil and all die
>>off.
>
>Now that's dumb.
I sure hope so. By the way, what ever happened to Jay? He was always
posting new ways that would cause us to all "die-off".
>
>>Grinch said energy prices have been declining for the last 300 years
>>and they would likely continue to drop.
>
>That is probably true (labor price, anyway), but does not mean the
>real price of _oil_ will continue the kind of trend it showed up to
>1973.
I agree, but we are predicting the future, and no one knows who is making
the most accurate predictions. I don't think it helps your case yell
"liar" so often.
>
>>I say my prediction has been the closest. Energy prices will likely drop
>>in the more distant future as substitutes for oil are brought on line.
>
>Agreed.
>
>>Probably hydrogen made fron water using wind, solar or nuclear energy.
>
>Disagree. Hydrogen is just a form of energy storage (and not a very
>convenient one), not an energy source -- unless you are talking about
>fusion, which is still very much a drawing-board technology.
If I was unclear, look again at my claim: hydrogen made from water USING
wind, solar or nuclear energy. The hydrogen is the energy carrier/storage
system. The wind, solar or nuclear --or geothermal or fusion or whatever--
is the energy SOURCE.
And I agree that hydrogen (as of now) is not as convenient as petroleum or
natural gas. But there are ways to make hydrogen more convenient to
transport and to use. Metal hydrides and special pipelines, etc.
>
>>Grinch will be correct in that "long run", but not for the next decade.
>
>I'm not even sure of that. Oil is one thing, energy is something
>else.
I agree. Today oil is a critical energy source, but it is energy that
counts, and not oil.
One point omitted from this discussion is the role of CO2. Grinch says
there is plenty of carbon based energy in the form of coal, oil in
shale,etc. One could include methane hydrates under pressure in deep
oceans. But these all would increase atmospheric CO2 if used. The
various CO2 sequestering schemes seem pretty impractical.
So my question to you guys: even if there IS plenty of carbon based
energy, would it be wise to actually USE it? Greenhouse/climate change and
all that.
ro...@telus.net
wrote:
<yawn> Why don't you try to pay attention to what is being said,
instead of thinking only about how you can chop the context to deceive
your readers? As I told Grinch multiple times, look at the real price
chart. Go on. _Look_. Would an OPEC that had any pricing power
allow the 1998 price dip? Or even the 1988 dip? Prices since 1987
show _zero_ control by OPEC. And except for 15 minutes in 1998, they
were _all_ higher than at _any_ time in the decade up to 1973.
>Please learn--after all these years--to pay attention.
Oh, I do -- unfortunately for your incessant efforts at deceitful
context-chopping.
-- Roy L
ro...@telus.net
wrote:
>> .claimed oil keeps getting harder to find while neglecting to mention
>> that the cost of finding each new barrel has dropped 75% in the last
>> 20 years.
>
>Not sure where you got that stat.
Not ver surprisingly, he got it from a source that counts
_additions_to_existing_reserve_estimates_ as "finding new oil
reserves." Increasing the estimated reserves in a known field thus
allows "new oil reserves" to be found at _zero_ cost. So by drilling
no exploration wells at all, we can reduce average oil finding costs
to $0/bbl!
>Who do you work for?
He's a lawyer, so "Satan" would be a good guess...
-- Roy L
ro...@telus.net
wrote:
>ro...@telus.net wrote:
>>On Tue, 15 Jun 2004 20:21:40 +0000 (UTC), Jim Blair <s...@sig.com>
>>wrote:
>>
>>>Since this is all in real dollars,
>
>>No. Patrick's quoted statement was about the _nominal_ price
>>fluctuating between $2 and $3.
>
>>>Your statement:
>>>
>>>>... The chart shows _real_ prices declining over the
>>>>same period, which makes sense, if you are intelligent and
>>>>knowledgeable enough (hint: you're not) to realize that there was mild
>>>>inflation over that period,(1948-60) resulting in declining real prices.
>>>
>>>does not make sense. Declining real oil prices were not a result of mild
>>>inflation: they COULD have gone either way.
>>
>>_No_. _Not_ given the $2-$3 price quote that Patrick falsely claimed
>>_contradicted_ my statement.
>
>This semantic point is not worth continuming,
Is that your way of saying you understand now that Patrick's claim was
just his usual deceitful context-chopping?
>except for one afterthought.
>I said that the falling real price of oil was not CAUSED by low inflation,
>as I thought you implied. I said the real price could have gone either way
>during those years (1948-60).
The real price _did_ go both ways in that period.
>But maybe not? One could argue that it was the stable and low price of
>oil that resulted in the low inflation. And that the it was the unstable
>supply of oil and irregular and increased oil prices of the 1970's that
>(at least indirectly) caused the inflation.
Inflation is a monetary phenomenon.
> had claimed that low
>inflation and low stable oil prices are two independent variables. But I
>can see that it could be claimed that they are related. Was that your
>point?
No, my point was simply and clearly that the combination of slightly
fluctuating nominal prices and mild inflation resulted in a trend of
gently declining real prices.
>I don't think it helps your case yell
>"liar" so often.
What else can I do, when Grinch, Patrick, et al think it helps their
cases to lie about what I have said?
>One point omitted from this discussion is the role of CO2. Grinch says
>there is plenty of carbon based energy in the form of coal, oil in
>shale,etc. One could include methane hydrates under pressure in deep
>oceans. But these all would increase atmospheric CO2 if used. The
>various CO2 sequestering schemes seem pretty impractical.
>
>So my question to you guys: even if there IS plenty of carbon based
>energy, would it be wise to actually USE it? Greenhouse/climate change and
>all that.
I am still a global warming skeptic. Not that the earth is not
currently warming (though I don't think even that is completely
proved), but that CO2 from fossil fuel combustion is necessarily the
cause.
-- Roy L
Robert J. Kolker
Jim Blair wrote:
> PV or wind will bump oil natural gas or coal only if they are used to make
> hydrogen from water, and the hydrogen is used to fuel transportaion and
> replace natural gas. (and I would bet on wind over PV as of now)
Fission is cheaper per kilowatt delivered at the point of consumption.
If it were not for the eco-weenies fission would be delivering the
equivalent of 30 dollar a barrel oil and we do not have to suck the
dicks of the arabs or kiss their asses to have the energy.
Bob Kolker
Matt Timmermans
news:caprkh$p3u$1...@news.doit.wisc.edu...
> I am much more optimistic. I say fusion will be only 10 years in the
> future for the next 100 years ;-)
I think cold fusion is going to end up working. See, for example:
http://www.physicstoday.org/vol-57/iss-4/p27.html
Does anyone know how much heavy water we have within easy reach?
Robert J. Kolker
Matt Timmermans wrote:
>
> I think cold fusion is going to end up working. See, for example:
After cold fusion, perpetual motion. Hope and foolishness never die.
Bob Kolker
Matt Timmermans
"Robert J. Kolker" <robert...@hotmail.com> wrote in message
news:6U6Ac.61689$HG.7966@attbi_s53...
>
> After cold fusion, perpetual motion. Hope and foolishness never die.
>
Hmph. There is a difference between cold fusion and perpetual motion, and it
is exactly the difference between hope and foolishness.
--
Matt
Jim Blair
??? Cold fusion is possibe under the accepted laws of Nature. It it just a
matter of finding the right conditions. But various other fusion options
exist as well, from magnetic containment to lasers zaping lithium
deuteride pellets.
Perpetual motion (if it were to ever be discovered) would require us to
re-write the Laws of Thermodynamics. So the two are not equally unlikely.
Robert J. Kolker
Jim Blair wrote:
> ??? Cold fusion is possibe under the accepted laws of Nature. It it just a
> matter of finding the right conditions. But various other fusion options
> exist as well, from magnetic containment to lasers zaping lithium
> deuteride pellets.
Show a -vetted- and -reproduced- demonstration of net output energy from
cold fusion. Pons and Fleischer were skewered because no one could
reproduce their results.
Write us when cold fusion is verified, will you? There's a good fellow.
Bob Kolker
Dave Morrison
culture. If he's just having fun, being obnoxious and playing Devil's
Advocate, then OK. Internet newsgroups are not the worst place for
that. But I'm afraid that he actually believes these arguments that
he's so vigorously marshalling. It's very strange to me that he would
be so insistent on believing and defending such baloney. Who does that
serve?
I mean, at some point we have to come up with the Plan B to fossil
fuels. No one argues that. So, why not start coming up with Plan B
now? It's likely we'll need it sooner than we expect. Why does this
scare people like Grinch so much, I wonder?
Grinch
wrote:
>Grinch,
>
>Despite your vehemence, you are totally unknowledgeable and almost no
>worth responding to. Every point you made was wrong. It's as though
>you have been living in a box since 1989 or so...
>
>> (Remember the source is a free weekly hand-out downmarket from the
>> Village Voice").
>
>The NY Press is actually much more well-read and doing a lot better
>journalism than the Voice these days.
It was before Russ Smith sold it.
But today all those writers are gone.
Now it stars the likes of Matt Tiabbi saying Bush should be fed his
own testicles, with a followup story saying he really meant it
literally.
If you think that's a step up in quality, more power to you.
> It's not the 1980s anymore.
I was hardly complimenting the Voice.
And as for the Press being "much more well read" than the Voice, a
quick look at the circulation figures will disabuse you of that
notion.
>> . it understated remaining oil supply by only a mere 2 trillion
>> barrels as per the USGS
>
>USGS numbers have been proven to be overly optimistic and
>scientifically unsound time and time again. There are lots of good,
>credible sources for this. You definitely should not take USGS numbers
>at face value.
All well and good -- yet it somehow still maintains a certain respect
among most, and a competent and honest journalist would at least
*mention* its figures before explaining that they are wrong because
the USGS is incompetent and owned by the industry (which for some
unknown reason wants to believe there's three times as much oil
remaining as there is, just as if they'd profit from massive
mistake.).
Rather than give a figure that's a mere 2 trillion b -- i.e. 2/3rds of
all -- smaller, as if there is no doubt about that, and nobody in the
world disagrees.
>They are trying to promote exploration.
>
>> . somehow overlooked that there's six times as much oil in Canadian
>> oil sands as in Saudi Arabia, and there are enough proven reserves in
>> Alberta alone right now to meet North American import needs for the
>> next 40 years.
>
>The article was about the end of "cheap oil" not the end of oil in
>general.
And "cheap" is what, in dollar terms? By what practical measure?
And by that practical measure "cheap" may be expected to be what in
dollar terms, 20 years from now? 40 years?
I gave my answer, you give yours.
> Tar sands oil is most definitely not cheap. It's very
>expensive to extract and is, in fact, only worth producing if light
>sweet crude costs have run up to about $50/barrel.
That's why it's producing profitably now at a production cost of $15/b
right now, 700k barrels a day, right?
And why commercial, for-profit companies like Suncor were ramping up
to produce it as fast as possible back when oil was $20/b. right?
Because it's not worth producing except at over $50. ;-)
> Tar sands and heavy
>oils in Canada and elsewhere will most likely not prevent us from
>peaking globally in the next ten years.
>
>> .claimed oil keeps getting harder to find while neglecting to mention
>> that the cost of finding each new barrel has dropped 75% in the last
>> 20 years.
>
>Not sure where you got that stat.
My, you're really up on your industry knowledge aren't you?
On usenet of course that goes with the strong opinions.
http://www.eia.doe.gov/emeu/25opec/sld010.htm
BTW, the trend continues downward since the last date there.
Do you suppose an honest, competent journalist claiming how it's
getting so much more difficult to find new oil might also have
mentioned how the price of finding each new barrel is falling -- if
only to explain it away?.
>In fact, we're having to go to
>greater geological extremes to find ever-smaller reserves.
What, the 177 billion of proven reserves that just appeared in Alberta
at $15/b -- the amount of proven reserves depends on proved production
cost you know -- were too small and well-hidden for you?
> The
>economics of it are not good. It used to take something like 1 barrel
>of energy to find 50 barrels of oil. Today it takes about 2.5 barrels
>of energy to find one barrel of oil. You do the math.
When energy comes in barrels I'll consider it. ;-)
>> . claimed *all* projections, including the most optimistic, say
>> production will peak by 2020 at the latest -- while the USGS and USEIA
>> project the date at from 2037 - 2047 ... etc., etc.,
>
>Data from both of these agencies is widly discredited by very
>mainstream sources. Besides you're citing their most optimistic data.
Tut tut -- the NY Press story I was critiquing said the "most
optimistic" projection was 2020, so I am exactly correct to do so,
right?
If the most optimistic estimate is 2037 -- from a source as *obscure*
as the USGS -- but the story explicitly says the most optimistic
estimate is 2020, then the journalist has not told the truth.
It follows that he was incompetent or, as Roy would say in such cases,
telling a fib.
>> I could go on and on with the dumb-assedness in it -- frankly, proof
>> of either incompetence or lying.
>>
>> But of course the Mother Dumbass Claim in it, compared to which the
>> rest is all mere detail, is that there is *no substitute* for pumped
>> oil -- as we can substitute bran for corn flakes -- so we must prepare
>> for the coming production top "as seriously as for nuclear war"
>> literally.
>>
>> *As if* Germany and South Africa hadn't already actually run their
>> economies on oil-from-coal, and *as if* gasoline from Canadian oil
>> sands isn't going into your car right now.
>
>We are most definitely not going to be able to run the "American Way
>of Life" as currently-configured with coal.
Why?
Is there something un-American about consuming coal? One would hardly
think so, considering the massive quantities that we do.
Is there some impossibility about turning coal into gasoline and other
oil products? One would hardly think so, considering the scale on
which it has already been done economically.
Is there some reason why a little gasoline from coal wouldn't mix with
and flow right into the tank along with gasoline from Athabasca that
is going into the tank right now? Should the day come that the tank
needs a little topping off? If so, please explain why gasoline can't
mix with gasoline.
Absent some positive answer to these questions your "definitely not"
is a statement that has all the foundation of what ... religious
belief?
>> And *as if* there isn't enough oil sands, coal, etc. and so on, to
>> produce oil on the foreseeably desired scale for maybe another 1,000
>> years, starting when those overlooked 2 trillion barrels should need
>> topping off.
>
>There is a lot of oil and fossil fuel left in the ground. But the
>cheap stuff is dwindling fast.
Not at all. The "cheap stuff" already totally disappeared a long time
ago, when the Pennsylvania oil ran out.
You see, this is an important point -- you need an economically
meaningful definition of "cheap". If you don't have a definition for
the word then the word is meaningless, and so are all claims regarding
same.
>Who do you work for?
Ooooh, someone who marshalls facts you don't like has his *motives*
questioned.
I work for sinister forces, undeniably.... but sinister forces that
respect facts, and which expect its lackeys who post on a sci.econ
forum to respect economics as well.
Who do *you* work for?
ro...@telus.net
wrote:
>On Mon, 14 Jun 2004 01:46:36 GMT, ro...@telus.net first asked to be
>re-introduced to the concept of"'rent seeking",
Lie.
>then finally and
>kindly provided a trend line for us clinching the case made in the
>first post in this thread.
Lie. The trend clearly refutes the claims you made in the first post
in the thread.
<yawn> Look at the chart, Grinch. In how many years since the early
70s _other_than_1998_ has the real price of oil been less than it was
_throughout_ the 1960s and early 70s?
I'm waiting.
>OK, so let me read you more carefully.
More studiedly inaccurately, you mean....
>When you wrote: "since the early 1970s, real oil prices have risen"
I was referring to the facts of objective reality, as proved by the
real oil price charts I pointed you to, and you have been lying about
ever since.
>What you *meant* was: "since the early 1970s, real oil prices have
>risen and then fallen too so by the late 1990s they were at a level
>below what they were even before the rise started .... thus
>demonstrating a trend ever upward from 1970!"
No, because that is false. In only one brief period in 1998 did oil
prices dip below the level they were at _throughout_ the 1960s and
early 1970s. Through _all_the_rest_of_the_late_1990s_ they were
higher.
>I gotcha. We understand each other now.
<yawn> I understand you, anyway. Do I ever.
>> And
>>I did not say the price rise since then had been steady, liar. And I
>>did not say the end-point of oil price history had been reached in
>>1998, liar.
>
>Well, no ... but now you do seem to need to say 1998 was the
>start-point of the rise you said started in the early 1970s, eh?
No, liar, I don't. What _you_ need to do, and have been doing, is
constantly try to pretend that the sharp price dip of 1998 was
something other than what it very obviously was: an anomaly far off
the trend.
>>You have chosen to lie about what I wrote, as usual, and
>>insert the word, "steadily," which I did not say. "Steadily" would
>>more accurately be applied to how oil prices declined from about the
>>1880s to 1972 (though that decline was also by no means monotonic due
>>to wars, financial panics, etc.). What was _really_ steady was the
>>price decline between about 1957 and 1972. Prices since then have
>>been far more volatile, but the trend has certainly been up. Which is
>>why I did not say they had risen "steadily." And why, as usual, you
>>had to lie about what I had written in order to have anything to say
>>about it at all.
Notice, readers, that Grinch has no response at all to the above
_proof_ that he is lying filth.
>>>> in part because of geopolitical events but primarily
>>>>because the fraction of current oil supply that can be extracted at
>>>>such very low cost has been declining.
>>>
>>>So let's see ... after steadily falling for 100+ years -- in spite of
>>>the cheapest oil being extracted and consumed first all the time at
>>>steadily increasing rates, of course
>>
>>Right, because for most of that time, "cheapest" just meant "closest
>>to the required infrastructure," not "easiest to extract" in any
>>fundamental geological sense.
>
>You just love making stuff up, eh?
Look who's talking!!!
>That's why the oil business started in Pennsylvania, where they could
>kick a dune with a boot and get oil with 1850s tech, because "easiest
>to extract" had nothing to do with it.
There were lots of places where oil was easier to extract, including
surface seeps. Titusville was near markets, railroads, etc.
>And, of course, oil companies would *never think* of placing required
>infrastructure *where* oil was easiest to extract!
They aren't the ones who build cities, railroads, canals, etc.
>They just set their infrastructure up where it was more costly and
>extracted near it, figuring they could always cut costs in the next
>century! ;-)
<sigh> You are just sad, now.
>But in any event, *whatever* definition of "cheapest" you want to use,
>even *yours*, I'm glad you agree that the **cheapest was used first
>and yet real prices fell** for over 100 years.
>
>Interesting, that.
Only to someone who has no idea of economics.
>OK, now I don't wan't you to accuse me of mangling your dates again,
>so do please clarify:
>
>Was the increase that was "_primarily because_ the fraction of current
>oil supply that can be extracted at such very low cost has been
>declining"
>
>a) The increase to $70 in 1981 from $16.47 in 1970?
>
>or
>
>b) The increase to $14 in 1998 from $16.47 in 1970, which occurred
>after all that "geopolitical" stuff in the '70s and '80s settled out
>and OPEC's rent collecting market power declined?
Neither, of course. You have simply provided a tendentious and
idiotic false dichotomy, because you are incapable of constructing (or
understanding) an honest factual or logical argument.
>I'm trying to get my primary causes straight here. ;-)
No, you aren't. You are trying to confuse and deceive your readers.
Let me clarify what you have tried to obscure:
Between 1974 and 1985, oil prices were totally dominated by OPEC.
OPEC's power was decisively broken in the mid-80s, at which time real
oil prices declined -- to about 50% _more_ than they had been
throughout the early 1970s. Since then, they have fluctuated within
an overall rising trend. So sometime between 1973 and 1985, and
probably before 1980, average extraction costs bottomed out as the
fraction of lowest-cost production reached its highest level. This
reflects the _fact_ that new field discoveries peaked in the 1960s,
and have been declining ever since.
>>>but when an new cartel arises and sends out press releases and hits
>>>you over the head with a rent-seeking stick, doubling prices
>>>immediately, *this* is a normal steady rise due to an erosion of
>>>primary supplies. ;-)
>>
>>Which of course I never said, nor implied.
>>
>>):^|
>
>Well, you said the "primary cause" of the rise after 1970
No. After 1973.
>was *not*
>rent seeking by those OPEC fellows but rising cost of getting the
>stuff out of the ground.
>
>And really, the rise that most people remember is to $70.
But that is not what we are talking about, is it? That happened more
than 20 years ago, and has nothing to do with current prices or the
trend since 1986.
>So some might draw an implication there.
They would be wrong, as you are.
>Of course, if you meant the rise to $14 from $16.47 in OPEC's last
>period of political weakness, as that better reflected a
>non-manipulated market price, that's something else.
Garbage. OPEC has been weak since 1986.
>>The long-term world oil price charts at
>>
>>http://www.wtrg.com/prices.htm
>>
>>prove that your claims are flat false.
>
>Bwah! ha! ha!
>
>Roy, you've got to learn to read your own authorities before posting
>them.
I cited only the price facts found there, not the editorial opinions.
The price facts that prove you wrong.
>It's taken *war* to get prices up (and what have we got now?
>Terrorists attacking is Saudi Arabia et.al.? Is that "geopolitical" in
>your book? )
We've always got war in the Middle East...
>Continuing with your preferred authority....
Lie. Of course.
>"The Very Long Term View
>
>"If long term history is a guide, those in the upstream segment of the
>crude oil industry should structure their business to be able to
>operate with a profit, below $15.28 per barrel half of the time..."
>
>What??? Hey, that's *half* of what prices are now!
Oil companies that follow this advice and eschew production at an
average cost of $15.29-$20 would be stupid. Like you.
>*Your authority* says that. Kudos!
I cited the price _facts_, not the editorial _opinions_.
>BTW, looking though that page I don't see any support *at all* for
>your claims prices being driven up because of rising extraction costs,
>eh? Do you??
Yep. The price charts. OPEC's power was broken in 1986, but real
prices were still 50% higher than in 1972.
>Projecting a profitable $15.28/b into the future, *your authority*
>there is taking the "very long term view" that the cost of oil is
>going to stay the same as it's been.
Which looks pretty dumb, considering what the price charts show.
>Also, those charts seem to have been too complex and confusing for you
>to read clearly.
<yawn> You are just sad, now.
>Here's a nice simple clear one you might enjoy.
>http://www.eia.doe.gov/emeu/25opec/sld010.htm
<snicker> I did enjoy it. But it seems _you_ are the one who has
failed to read _your_ preferred authority...
"Note(s): Costs are calculated as the ratio of total exploration and
development expenditures to total oil and gas reserve additions
(barrels of oil equivalent), for the major energy producers reporting
to the Energy Information Administration."
IOW, when oil producers report upward revisions to reserve estimates
_even_without_doing_any_drilling_, you claim it proves that the cost
of finding oil has declined!
>>>And at the end this time reserves are at an *all time high*
>>
>>Reserves by what definition? Are you not even a tiny bit skeptical
>>about reserve figures showing no increase in reserves from 1970 to
>>1985, and then a near-50% increase over the next few years, despite
>>_fewer_ new field discoveries? Are you unaware that OPEC rewards
>>increases in its members' reported reserves with increases in
>>production quotas?
>
>Hey, Roy, aren't you even *more* skeptical about the 177 billion in
>proven reserves that just appeared in your own Alberta up there, with
>*no* new discovery at all!!!
They appeared because prices increased to over $30/bbl. That's not
"cheap oil forever."
>Tell us a piece of data, now: What's the average productivity
>increase in extraction technology in this industry??
Probably similar to that in similar industries.
ROTFL!! Gee, Grinch, by simply applying the same "logic" to whaling
150 years ago, we really _can_ run the world on whale oil today!!
;^)
>>...Almost all of which increase in reserves occurred in the late 1980s
>>for political reasons, and represents upward revisions of the reserves
>>in known fields, not new field discoveries. The chart at the bottom
>>of
>>
>>http://wwwistp.murdoch.edu.au/teaching/N212/n212content/topics/topic5/03worldoilgas.html
>>
>>is quite revealing on that score.
>
>It's magic! I tell you, magic!
Well, I guess "magic" is one word for your claim that upward revisions
of reserve estimates without doing any drilling is "finding oil."
>Of course, as Asimov said, the effects of technology always appear as
>magic to the naive.
It was Arthur C Clarke: "A sufficiently advanced technology is
indistinguishable from magic."
>>>>>Although admittedly the geocentric solar system agreed much better
>>>>>with empirical observations of reality.
>>>>
>>>>What has happened to the real price of oil over the last 35 years,
>>>>Grinch? How about over the last 20 years?
>>>
>>>20 years:
>>>
>>>1984: $52 per barrel (2004 dollars)
>>>2004: $34 per barrel (average through May)
>>>
>>>You know, Roy, for a guy with such strong opinions you don't actually
>>>*know* anything. Eh?
>>
>>?? Oh, dear...
>>
>>It seems you slightly misunderstood what I was asking.
>
>What happened to the price of oil over the last 20 years??
>
>It fell.
And rose, and fell, and rose.
>Admittedly the numbers I gave above understate how far it fell and for
>how long, by giving as the end point the recent five month demand
>spike up to $34.
>
>Numbers can be misleading that way.
You should know, as you don't use them for any other purpose.
>> A starting
>>price and an ending price do not say what has happened to the price
>>_over_ the period. Oil peaked a little over 20 years ago, at real
>>prices it hadn't seen in 100 years, and then fell to a 1988 _low_
>>about _50%_higher_than_ its average price in the ten years to 1973.
>>It then rose and fell quite substantially, and at its 1998 minimum
>>(triggered by the 1997 East Asian financial panic) _briefly_touched_
>>the levels it had been at for a solid _decade_ up to 1973.
>
>You mean it fell to 15% below what it was in the early 1970s which
>*you* said was the low price point culminating the long decline.
>
>Then we get it rocketing up in 1974, and again in 1980-81
>
>Which *primarily* reflected true increased cost and scarcity, you say,
>eh? ;-)
No. You are just lying again.
>While the 20-year decline after the political events up to '81 passed
It was not a 20-year decline, liar, as the price charts prove.
>-- as OPEC lost its clout and RENT SEEKING ABILITY -- to *below* what
>the price was in the pre-73, that was just an aberration. ;-)
Yep. The price charts make it absolutely clear that the momentary
price dip in 1998 _was_ an aberration, just as the OPEC-forced peak of
1974-85 was.
>When rent-seeling diminishes, what do you expect to happen to price?
>Might it go nearer its natural level?
Sure. Which is why it was 50% above its 1972 level _even_ when OPEC
was completely broken in 1986.
>> Since that
>>_very_brief_ 1998 minimum, it has of course soared to _sustained_ real
>>prices far above the _sustained_ prices of the pre-1973 era.
>
>You mean, as *your source* said, OPEC then organized a new round of
>rent seeking -- do you know what that is? -- to get the price up.
OPEC has had little pricing power since 1986.
>>Now, as for the 35-year price history, for which you not so
>>unexpectedly declined to proved any response at all, you are of course
>>aware that the price from 1969 to 1973 was _always_ far below the
>>average price since then,
>
>The "average price" ???? Hello??
>
>Roy ... how does a bout of $70 a barrel from rent seeking and embargo
>affect *average* price?
Gotcha. Look at the average real price _since_1986_ when OPEC was
decisively broken. It's _still_ far above the average real price in
the 1960s and early 70s.
You are destroyed.
>Hey ... now if you *really really* think that $70 a barrel oil
>resulted *primarily* from supply constraint and increasing extraction
>cost,
I didn't say that, did I, liar?
>then you have the little problem of explaining how it fell over
>the next 20 years to $14.
It didn't. It only touched $14 momentarily in 1998. It wasn't $70 in
1978.
>An 80% fall over 20 years ain't an
>aberration!
<yawn> It also isn't what happened.
>>and that the low price attained for about 15
>>minutes in 1998 has been followed by much more typical -- i.e., much
>>higher -- post-1973 prices.
>>
>>>I mean, personally, before I went on and on with all these price
>>>claims I'd *check them* to make sure I wasn't making an ass of myself.
>>
>><snicker> No, you wouldn't. You didn't. And _you_ consequently
>>_have_ made an ass of yourself.
>
>ROTFLMAO. ;-)
>
>I *read* my sources, Roy.
<snicker> Did you read the note to your source that explained _how_
the cost of "finding oil" declined 75%?
>And I read *your* sources too. The way they agree with me, it's a
>pleasure!
You can certainly find opinions that agree with yours. Just not
facts.
>>>>>Meanwhile, we're all still waiting for our first observation of a
>>>>>mineral resource rising in price perpetually (much less running out)
>>>>>due to scarcity as a result of humanity's consumption of it.
>>>>
>>>>Do you or do you not understand that the real price of oil fell until
>>>>about 1970, and has been rising since then?
>>>
>>>1970: $16.47 per barrel
>>>1998: $14.00 per barrel (2004 dollars)
>>>
>>>Does "rising" have a different meaning in Canada?
>>
>>2004: $40/bbl. Does "since then" have a different meaning in what you
>>are no doubt pleased to call your "brain"?
>
>Bwah! Ha! Ha! Ha!
>
>In Canada "since 1970" means "in 2004"!!
It means _all_ the years since then. Not just one cherry-picked one.
>>>And looking at things another way...
>>>
>>>1981: $70 per barrel
>>
>>A peak it had not seen for 100 years...
>>
>>>2003: $21 per barrel
>>>
>>>... I'd probably say that 22 years constitutes a trend too.
>>
>>Oh? What happened to the $16.47/bbl in 1970 that you seemed to be
>>aware of just a few lines up? Or any of the other
>>_sustained_low_prices_ before 1973?
>
>What happened in 1973, Roy?
>
>Could it have been RENT SEEKING??
>
>Bwah! ha!
<yawn> Answer the question, pathetic idiot.
>Did you read your own source about 1973-81???
Yes, and many others.
>BTW, isn't it just an *amazing coincidence* how you figure that after
>130 years of general decline, extraction costs started their
>inevitable rise at the *exact same time* as this cartel, C-A-R-T-E-L,
>got together and began engaging in massive RENT SEEKING.
Given that I said no such thing, and you are lying, as usual, it is
not that amazing.
>What a coincidence, eh? Really, the inevitable rise of extraction
>costs could have begun on any one of 150 other years. What were the
>odds?
Garbage. Discoveries peaked in the 1960s. The low of average
extraction costs really couldn't have occurred before that.
>Today the Saudis are sitting on 260 billion barrels of oil that they
>can extract for a cost as little as $2/barrel, keeping it *off the
>market* to jack up prices ... and the problem keeping prices up is
>there's no oil left in the world with low extraction cost!!!!
<yawn> More stupid strawmen.
>>>Compared to *that*, do you think a one year price spike constitutes a
>>>trend?
>>
>>Look at the chart, Grinch. And you evidently think a one-year price
>>_dip_ constitutes a trend...
>
>What's the one year dip? 1970 to 1998, or 1981 to 1998?
1998 alone. One year. Remember? The _only_ recent year you admit
existed, and the _***only***_ year since 1973 when real oil prices
were _ever_ anything but _higher_than_ they were for the
_15_straight_years_ from 1959-73?
>Geeze -- you quote $40/b in support of a "trend"... and that didn't
>last even *one month*!
The peak couldn't matter less. What matters is that aside from a few
minutes in 1998 (the only year you claim existed since 1981), prices
have been well above the level they were at _all_through_ the 1960s
and early 70s.
>>>Roy, it looks to me like your long-term "trends" consist entirely of
>>>the three years 1973, 1981 and 2004 ...
>>
>>Look at the chart, liar.
>
>Ok, OK. Hmmm... I see two huge spikes from *rent seeking* in 1973 and
>1981, and down, down, down otherwise to $14 in 1998.
That is a flat-out lie.
>Then I see a rise all the way back to $20 in 2001 -- no higher than it
>was in 1949
Certainly. 1949 is another cherry-picked year, like 1998.
>-- which rise had to be manipulated through another round
>of *rent seeking*, well, at least according to *your authority*
Funny how you are so eager to believe the opinions that agree with
yours, but not the facts that don't....
>Then I see price bouncing around there for three years ($21 in 2002)
>followed by a *price spike* in 2004 when *simultaneously*, the
>economies of the US, Japan., China and India boom, there is a war in
>the Mideast and terrorists striking the oil industry in Saudi Arabia
>
>What do you see?
I see that except for _one_ year, 1998, prices over the nearly two
decades since OPEC was decisively beaten in 1986 have _always_ been
well above the level they were at for _15_straight_years_ up to 1973.
>>>Now here's a question for you:
>>>
>>>Three years ago there was a big milk surplus down here, and a
>>>recession too, prices fell real low, so a lot of farmers got rid of
>>>their milk cows and went into something else.
>>>
>>>This year there is a *boom* and milk demand is *way up* -- and the
>>>price of a gallon of milk has risen by *much more* than that of a
>>>gallon of gasoline! It's true!! And with summer the price of ice
>>>cream has shot up even more than that!! You can look it up!
>>>
>>>Now, reading the "trend" of this one-year price spike and its deeper
>>>meaning, do you conclude the nation is finally and forever running out
>>>of cows?
>>
>>One year does not make a trend
>
>Right! And *one month* at $40, does not make a trend.
>And *five months* averaging $34 does not make a trend.
Then why do you cite the same one single year, over and over again ad
nauseam?
>>-- not even 1998, unfortunately for
>>you.
>
>But...
>1949: $20.
>1998: $14.
Two cherry-picked data points. You know: the only kind you ever cite.
>Or since you don't like that how about...
>
>1949: $20
>2002: $22.50
1949 is another cherry-picked year, as the price chart shows oh so
clearly.
>> Contrary to your claims, 1998 was not the last year oil would
>>ever have a price, and the _momentary_ bottom touched in that year
>>(which, contrary to your claims, was not the all-time low -- that was
>>reached in the early 1930s)
>
>In the Great Depression? Was that because extraction costs fell? ;-)
No. Was the momentary dip of 1998 because extraction costs fell?
>>>Are you saying that they *could* provide a few days worth?
>>
>>No. Why do you feel you always have to lie about what I write? I'm
>>not sure exactly how much energy there is in all the whale oil
>>remaining in the world, but it's certainly no more than a few days'
>>petroleum consumption worth.
>>
>>The point is, you said the experts who said the world was running out
>>of whales and could not continue to use them as a source of energy for
>>very much longer were not looking at the facts. But they were. They
>>were right.
>
>No, they were *wrong*
No, they were _right_, as you yourself have admitted.
>Better brush up on that reading comprehension for the Mensa renewal.
>
>(Notice I am not saying you *lie* about what I wrote, just that you
>have trouble with comprehension. I'm a nice guy.)
You are a servant of Darkness.
>What I *said* was that the experts predicted fuel prices would rise
>and supplies would fall "bringing the Industrial Revolution to a
>grinding halt" because the wales *would* be killed off and coal
>*would* run out in Britain.
>
>But the wales were *not* killed off,
Uh, yes, actually, in point of fact, they were. The most hunted
species were in fact hunted to the brink of extinction (made possible
by that "increased productivity" of whalers that you now claim would,
if sustained, somehow increase the number of whales rather than
accelerate their extermination).
>Britain did *not* run out of
>coal, and rising prices did *not* bring the Industrial Revolution to a
>grinding halt, it continued on rather notably well. Zero for three.
>
>Now, what have we learned?
You? Nothing. As usual.
>The USGS says there's 80 years of conventional oil left with a
>probable production peak around 2040 or so.
Ignoring the fact that US production peaked more than 30 years ago...
>Gee, do you suppose that deca-trillions of barrels of oil in tar
>sands, coal, natural gas, etc and so on, might be able to produce
>enough to cover that gap, as technology makes economic extraction of
>reserves that we'd think of as having a cost of $165 to $1,100 a
>barrel today?
Possibly. But that's not exactly "cheap oil forever."
>Especially being that entire economies have *already* run on the
>stuff?
Not modern ones, and not very well.
>>>Trend or not?
>>
>>Certainly these data demonstrate a trend: your unmistakable trend to
>>dishonestly presenting cherry-picked data, on the few occasions you
>>present any data at all.
>
>Yeah, ain't it remarkable how one can cherry pick data from recent
>years showing prices in the same ballpark or less than the $20/b of 55
>years ago? 1994: $20 1999: $20 2001: $23 .... I mean, being that
>the price trending has been *up* for *so long*, with extraction
>costs relentlessly rising?
_All_ those prices are well above the _sustained_ prices recorded over
more than a _decade_ up to 1973.
>>Look, just go to the price charts at http://www.wtrg.com/prices.htm,
>>Grinch, and tell us what you see. And for once in your life, try to
>>be honest.
>>
>>Oh, and I'll leave you with a question:
>>
>>1932: $9/bbl
>>1968: $18/bbl
>>2004: $36/bbl (2004 dollars)
>>
>>Your cherry-picked data showed a price decline of 30% in 50 years.
>
>No, Roy, wrong again.
It is fact.
>Mine showed *no significant rising trend*, especially not one due to
>scarcity or extraction cost after counting for the effects of the
>*rent seekers*.
As long as you assume there have been no years since 1998.
>I neither claim nor care about a falling trend.
Lie.
>My only concern -- as expressed *extensively* in the first post of
>this thread, if you actually trouble to recall -- is that oil stay
>under $55 a barrel or so, adjusted upward for continuing decline in
>use in proportion to GDP.
That's maybe possible in the medium term. But it's not what most
people would call, "cheap oil forever."
>>data are not cherry-picked. I just chose the all-time low price, and
>>the most recent price, and the price at a date midway between those
>>times.
>
>Bwah! ha! ha!
>
>"Not cherry picked" he says, projecting a straight-line trend from a
>Great Depression all-time low to a boom & rent seeking 19-year high!
$36 was not the high.
>Just for the record, when you are *really* not cherry picking you run
>a trend line from one cyclical high to another cyclical high, or from
>a cyclical low to another cyclical low.
Oil price cycles are too disturbed for such methods.
>So our *trend* is ....
>
>Constantly Diminishing Cost of Oil in terms of GDP!
That is entirely possible, given reasonably benign economic policies
in the USA (which are by no means guaranteed) and no big disruptions
like regime change in Saudi Arabia (also by no means guaranteed).
-- Roy L
Grinch
wrote:
>Boy, this Grinch fellow represents a real scariness in American
>culture. If he's just having fun, being obnoxious and playing Devil's
>Advocate, then OK. Internet newsgroups are not the worst place for
>that. But I'm afraid that he actually believes these arguments that
>he's so vigorously marshalling. It's very strange to me that he would
>be so insistent on believing and defending such baloney. Who does that
>serve?
One notes the lack of any substantive response to any of the baloney,
except for the very silly claim that Athabasca is uneconomic at any
price under $50 while it is producing 700k barrels a day quite
profitably at a cost of $15.
>I mean, at some point we have to come up with the Plan B to fossil
>fuels. No one argues that.
Ah, well then it's not just oil but *all* fossil fuels.
At what point would "some point" be, precisely. And why?
Many could reasonably argue that, and also the suddenness of the
transition.
>So, why not start coming up with Plan B now?
Now???
If we are talking about replacing *all* fossil fuels then I would say
Plan B was sketched out a good half-century ago: nuclear.
Are you encouraging the ramp-up of nuclear?
If so, I'm all for it! Go!!
Keep the fossil fuel in the ground, keep the CO2 out of the air, save
all that strip mining, end new cases of black lung disease, end all
the injuries and fatalities involved in mining moving burning coal &
gas etc, put cars on separate hydrogen and batteries ... I'm all for
it!
Fact is, I can hardly take any environmentalist who goes on about CO2
and all rest at all seriously if he or she is not in favor of nuclear.
OTOH, if your Plan B isn't nuclear you will have to explain what it is
and why and the practicality of it.
There's photovoltaic and lots of other stuff out there that's all very
promising over the long run for various niches, but for mainline power
generation there's just fossil fuels and nuclear. And civilization is
going to need mainline power for a long time yet -- with the four
billion people in underdeveloped parts of the world needing a lot more
of it.
So what's *your* Plan B?
>It's likely we'll need it sooner than we expect.
>Why does this
>scare people like Grinch so much, I wonder?
Scare? ;-)
Some people do have the need to peddle fear by scaring people with
claims such as "an oil production peak must be faced equally seriously
as the threat of nuclear war".
Why, the story you endorse engages in just such scare mongering.
Nuclear war! And even says the nuclear war reference is *not*
hyperbole!
Perhaps you can explain the need of others to scare monger like that?
And why others would endorse it. Nuclear war!!
Now, some people like Grinch rather *don't* get scared by such, being
familiar with the facts and economics of the issue as they are -- and
in touch with common sense too, as "nuclear war" is not coming at the
gas pump even at $100/b, sorry.
And this bothers you in such a way that you question their motives,
and who they work for, and you think they *must* be scared as the
explanation for their not being scared.
Interesting psychology, that.
Sort of like the functioning of secular religion. Fundamentalist
secular religion.
Albert
> Boy, this Grinch fellow represents a real scariness in American
> culture.
I don't even bother reading his posts anymore. Though I do enjoy it
when Royl makes a fool of him again and again.
<snip>
--
"Let me give you a definition of ethics: It is good to maintain and
further life; it is bad to damage and destroy life."
-- Albert Schweitzer
susupply
<ro...@telus.net>
being a little confused, geopolitically,
wrote in message news:40d1fa9c...@news.telus.net...
> Between 1974 and 1985, oil prices were totally dominated by OPEC.
> OPEC's power was decisively broken in the mid-80s, at which time real
> oil prices declined -- to about 50% _more_ than they had been
> throughout the early 1970s. Since then, they have fluctuated within
> an overall rising trend. So sometime between 1973 and 1985, and
> probably before 1980, average extraction costs bottomed out as the
> fraction of lowest-cost production reached its highest level. This
> reflects the _fact_ that new field discoveries peaked in the 1960s,
> and have been declining ever since.
You still haven't been able to produce any evidence at all for this--but
plenty that shows the opposite.
And, OPEC was not "decisively broken in the mid-80s". Which a perusal of
most any newspaper will confirm. What happened in 1985 was that due to
years of sweet-talking (and sweet-acting) by the Reagan Administration,
Saudi Arabia faced up to the real dangers of Soviet troops on its
doorsteps--North and South Yemen, Syria, Iraq, Ethiopia, and
Afghanistan--and ordered huge increases in its oil production.
From under 2 million barrels a day to almost 9 million. The price dropped
to less than half what it had been. That's one of the ways Reagan won the
Cold War, as the price drop cost the Commies between $5 and $6 billion per
year. Probably the main reason Gorby surrendered.
jim blair
"Robert J. Kolker" <robert...@hotmail.com> wrote in message
news:H2nAc.46525$Hg2.7414@attbi_s04...
Hi,
I didn't say cold fusion HAS happened. I say it COULD happen.
Rather like powered heavier-than-air human flight, before 1900.
Possible under the natural laws as they were understood; just that
proper conditions had not yet been discovered.
If a practical fusion system is ever found, my bet is on the laser-LiD
system, with magnetic containment in second place, and cold fussion
3rd.
Until then, lets build nuclear fission power plants.
,,,,,,,
_______________ooo___(_O O_)___ooo_______________
(_)
jim blair (jeb...@wisc.edu) Madison Wisconsin USA.
Robert J. Kolker
jim blair wrote:
> Hi,
>
> I didn't say cold fusion HAS happened. I say it COULD happen.
> Rather like powered heavier-than-air human flight, before 1900.
> Possible under the natural laws as they were understood; just that
> proper conditions had not yet been discovered.
And my Grandmother could grow testicles. In which case I would have to
caller her Grandpa.
By the way Lilienthal was flying gliders in the 1890's. The reason why
HTA flight did not happen then was that no one knew how to construct
internal combustion engines with a good enough power to weight ratio.
This was first done by the Freres Wright in 1902. Once they got the
problem of control (which was the chief problem, not lift) they put one
of their motors on their best glider design. The rest is history.
>
> If a practical fusion system is ever found, my bet is on the laser-LiD
> system, with magnetic containment in second place, and cold fussion
> 3rd.
>
> Until then, lets build nuclear fission power plants.
I agree. Pie in the sky tastes good only when you are asleep and dreaming.
Bob Kolker
Grinch
On Thu, 17 Jun 2004 22:39:18 GMT, ro...@telus.net followed lies to
truth, writing...
> (Grinch) oldn...@mindspring.com wrote:
>..........
>Lie.
>....
>Lie.
>....
>
>No, liar...
>>>You have chosen to lie ...
>
>Lie. Of course.
>...
> You are just lying again....
>That is a flat-out lie.
>...
>You are a servant of Darkness.
( Aw, shucks...)
>Lie.
>...
>>So our *trend* is ....
>>
>>Constantly Diminishing Cost of Oil in terms of GDP!
>
>That is entirely possible...
TRUTH!
>... given reasonably benign economic policies
>in the USA (which are by no means guaranteed) and no big disruptions
>like regime change in Saudi Arabia (also by no means guaranteed).
Neither of which is **the entire world running out of supply**.
And as a cost of oil that is *constantly diminishing* in terms of GDP
can hardly be considered to be becoming more expensive to the economy
at the same time, I rest my case.
Cheap Oil Forever!
>-- Roy L
ro...@telus.net
wrote:
>On Thu, 17 Jun 2004 22:39:18 GMT, ro...@telus.net followed lies to
>truth, writing...
>
>> (Grinch) oldn...@mindspring.com wrote:
>
>>>So our *trend* is ....
>>>
>>>Constantly Diminishing Cost of Oil in terms of GDP!
>>
>>That is entirely possible...
>
>TRUTH!
>
>>... given reasonably benign economic policies
>>in the USA (which are by no means guaranteed) and no big disruptions
>>like regime change in Saudi Arabia (also by no means guaranteed).
>
>Neither of which is **the entire world running out of supply**.
That is clearly a strawman.
>And as a cost of oil that is *constantly diminishing* in terms of GDP
>can hardly be considered to be becoming more expensive to the economy
>at the same time, I rest my case.
Not so fast, counsellor. If the economy continues to shift toward
growth of the medical industry and other "mandatory" sectors, oil
_could_ continue to decline in price relative to GDP, yet still
account for an increasing fraction of discretionary spending.
>Cheap Oil Forever!
So I assume you're shorting oil stocks...?
-- Roy L
Dave Morrison
You're basing your assumptions on USGS numbers and other "facts" that
don't match up with Planet Earth realities. So, it's not so much worth
talking to you about "facts" if that's where you're at. Seems like you
probably have some ideological or psychological reasons for your
fossil fuel opinions. Who know.
As for nuclear, sure. It's got to be a part of the conversation.
As for talking about "fossil fuels" and not just oil -- sure, why not.
The natural gas supply has already peaked in North America.
As for running out of all oil immediately -- no one is saying that we
will. Did you even read that NY Press article or do you just look at
pictures?
Dave Morrison
he's an economist.
Grinch
"discretionary spending" ;-)
>>Cheap Oil Forever!
>
>So I assume you're shorting oil stocks...?
Nah, picking individual stocks is a mug's game unless one has
informtation the market doesn't -- transaction costs alone will kill
you.
But I do note that oil company stocks have performed surprisingly
poorly during this $35/b episode, sort of like the markets expect it
won't last.
>
>-- Roy L
Grinch
wrote:
>Grinch,
>
>You're basing your assumptions on USGS numbers and other "facts" that
>don't match up with Planet Earth realities....
Says they guy who states as a fact that Canadian oil sands won't be
economically producable until oil reaches $50 a barrel, as he pumps
gasoline made from it into his car. ;-)
>So, it's not so much worth
>talking to you about "facts" if that's where you're at. Seems like you
>probably have some ideological or psychological reasons for your
>fossil fuel opinions.
Yup -- me, and the US Geological Survey, and Suncor Inc. as it makes
gasoline from oil sands at $15/b and sells it at $30/b
The Suncor people in partilcular must have very strange "psychological
reasons" for believing they are making money at that rate on 200k
barrels a day when the *fact* on "Planet Earth" is it can't be done,
eh? ;-)
Or maybe the Planet Earth you assert just isn't necessarily the same
one the rest of us are walking around on.
>As for nuclear, sure. It's got to be a part of the conversation.
>
>As for talking about "fossil fuels" and not just oil -- sure, why not.
>The natural gas supply has already peaked in North America.
Coal production peaked in Britain in 1915.
No doubt this was a sign of the world running out of coal and future
coal prices shooting every upward, eh?
Did you wander into an economics newsgroup by mistake?
>As for running out of all oil immediately -- no one is saying that we
>will. Did you even read that NY Press article
Sure I quoted four specific items from it without reading it. ;-)
You display your power of analysis there about as well as elsehwere.
> or do you just look at pictures?
Nah, after Smith sold it they were too cheap even to pay for the
decent comics, so now even the funnies have gone to crap.
But enough on the decline of the NY Press, back to oil.
I do note that you snipped and declined to answer the key question I
asked you twice: What is the actual definition of "cheap ol" in
dollar terms, now and in the projectable future?
If you don't have *that* you obviously can't have any meaningful
opinion about whether it is sustainable or not, eh? You are just
blowing wind.
But apparently answering such a simple question is beyond your bounds,
and so leaves you doing no better than retorting about the strange
ideology and psychology of others who are capable of comprehending
such things.
So I'll make it even *simpler* for you:
Your buddy Roy now agrees with me that "constantly diminishing cost
of oil in terms of GDP" ... "is entirely possible"
So do you read "constantly dimishing cost in terms of GDP" as ever
rising cost, and the end of cheap oil?
Or are you consigning Roy to your crank list too?
Grinch
>On Tue, 15 Jun 2004 23:32:50 GMT, Grinch <oldn...@mindspring.com>
>wrote:
>
>.....
>>Of course, as Asimov said, the effects of technology always appear as
>>magic to the naive.
>
>It was Arthur C Clarke: "A sufficiently advanced technology is
>indistinguishable from magic."
Arghhh!!
A named *source* reference...!!
[... clutches chest ...]
And a verifiably right one too!
I sit corrected, and shall endeavor to remember this in the future.
When you are right you are right, and I am happy to admit it. ;-)
myparadox
atleast humour me, which seems to be more of the trend in this group.
Why not have another embargo of Arabic Oil? Remove the tax from oil to
begin with, then subsidize oil companies so that they can find it
cheaper. Pump money otherwise spent on creating a bloody oil
holocaust, into the costs of drilling, discovery, science, etc.
Wouldn't the trillions of dollars that it will take to marshall Middle
East stability, over the next decade, be better spent reversing these
inflationary trends, if it would make us less reliant on the Arabic
oil. God forbid, also reduce everything else in that area of the
world, and let them fend for themselves for awhile. Surely
inflationary trends that might otherwise result from decreased supply
on the open market could be thwarted with most non-OPEC counties oil
reserves, and reduced forms of taxation that could be put in place for
those with more need of fossil fuel use. Why is it so difficult to cut
off you nose to spite your face, if you are ugly in the first place?
Jim Blair
>
>>But maybe not? One could argue that it was the stable and low price of
>>oil that resulted in the low inflation. And that the it was the unstable
>>supply of oil and irregular and increased oil prices of the 1970's that
>>(at least indirectly) caused the inflation.
>
>Inflation is a monetary phenomenon.
Hi,
So says Milton Friedman, and he does know something about economics ;-)
But it is a reflection of the primative state of economic theory that
there are others who claim that inflation is caused by critical price
increases that are passed on (like energy), and that the money supply
increase is a consequence of inflation rather than the cause.
>
>> had claimed that low
>>inflation and low stable oil prices are two independent variables. But I
>>can see that it could be claimed that they are related. Was that your
>>point?
>
>No, my point was simply and clearly that the combination of slightly
>fluctuating nominal prices and mild inflation resulted in a trend of
>gently declining real prices.
A tautology?
>>One point omitted from this discussion is the role of CO2. Grinch says
>>there is plenty of carbon based energy in the form of coal, oil in
>>shale,etc. One could include methane hydrates under pressure in deep
>>oceans. But these all would increase atmospheric CO2 if used. The
>>various CO2 sequestering schemes seem pretty impractical.
>>
>>So my question to you guys: even if there IS plenty of carbon based
>>energy, would it be wise to actually USE it? Greenhouse/climate change and
>>all that.
>
>I am still a global warming skeptic. Not that the earth is not
>currently warming (though I don't think even that is completely
>proved), but that CO2 from fossil fuel combustion is necessarily the
>cause.
>
>-- Roy L
Some global warming skeptics claimed that the earth has not been warming.
But if you agree that it is, we all know that burning fossil fuels
releases CO2, and that atmospheric CO2 levels have been rising, and that
CO2 adsorbs heat radiated from the earth that would otherwise escape into
space.
So what is there to be skeptical about? (Except maybe that warmer is
better)
Hmmmm. Inflation-expanding money supply; global warming-increased CO2.
For both of these, the correlation is not questioned, but the causality
is.
,,,,,,,
_______________ooo___(_O O_)___ooo_______________
(_)
jim blair (jeb...@facstaff.wisc.edu) Madison Wisconsin
Jim Blair
>
>
>jim blair wrote:
>
>> Hi,
>>
>> I didn't say cold fusion HAS happened. I say it COULD happen.
>> Rather like powered heavier-than-air human flight, before 1900.
>> Possible under the natural laws as they were understood; just that
>> proper conditions had not yet been discovered.
>
>And my Grandmother could grow testicles. In which case I would have to
>caller her Grandpa.
Hi,
Closer to "your grandmother could have a sex change operation."
>
>By the way Lilienthal was flying gliders in the 1890's. The reason why
>HTA flight did not happen then was that no one knew how to construct
>internal combustion engines with a good enough power to weight ratio.
>This was first done by the Freres Wright in 1902. Once they got the
>problem of control (which was the chief problem, not lift) they put one
>of their motors on their best glider design. The rest is history.
Yes, limited by power and control. And if fusion becomes practical people
will look back and say that it happened when someone learned how to
control the magnetic bottle while enough power was applied to it.
Until then, lets build nuclear fission power plants.
>
>I agree. Pie in the sky tastes good only when you are asleep and dreaming.
>
>Bob Kolker
>
>
,,,,,,,
_______________ooo___(_O O_)___ooo_______________
(_)
jim blair (jeb...@facstaff.wisc.edu) Madison Wisconsin
ro...@telus.net
wrote:
>ro...@telus.net wrote:
>>On Wed, 16 Jun 2004 17:14:54 +0000 (UTC), Jim Blair <s...@sig.com>
>>wrote:
>..
>>> had claimed that low
>>>inflation and low stable oil prices are two independent variables. But I
>>>can see that it could be claimed that they are related. Was that your
>>>point?
>>
>>No, my point was simply and clearly that the combination of slightly
>>fluctuating nominal prices and mild inflation resulted in a trend of
>>gently declining real prices.
>
>A tautology?
Yes. Some people refuse to know that 1+1=2.
>>I am still a global warming skeptic. Not that the earth is not
>>currently warming (though I don't think even that is completely
>>proved), but that CO2 from fossil fuel combustion is necessarily the
>>cause.
>
>Some global warming skeptics claimed that the earth has not been warming.
There is also the fact that the earth has had previous warming
episodes when fossil fuel combustion was definitely not a factor, and
when warming led CO2 increases by many years.
>But if you agree that it is, we all know that burning fossil fuels
>releases CO2, and that atmospheric CO2 levels have been rising, and that
>CO2 adsorbs heat radiated from the earth that would otherwise escape into
>space.
>
>So what is there to be skeptical about?
The size of the effect, for one, and the claim that some very poorly
understood confounding variables cannot be relevant, for another.
>(Except maybe that warmer is
>better)
Well, I am Canadian....
>Hmmmm. Inflation-expanding money supply; global warming-increased CO2.
>For both of these, the correlation is not questioned, but the causality
>is.
Right.
-- Roy L
Jim Blair
>On Mon, 21 Jun 2004 18:13:11 +0000 (UTC), Jim Blair <s...@sig.com>
>wrote:
>
ro...@telus.net wrote:
>
>>>I am still a global warming skeptic. Not that the earth is not
>>>currently warming (though I don't think even that is completely
>>>proved), but that CO2 from fossil fuel combustion is necessarily the
>>>cause.
Jim Blair:
>>
>>Some global warming skeptics claimed that the earth has not been warming.
>
>There is also the fact that the earth has had previous warming
>episodes when fossil fuel combustion was definitely not a factor, ....
Hi,
Not humans burning fossil fuels, but with higher atmospheric CO2 levels,
probably from volcanoes.
....and
>when warming led CO2 increases by many years.
I don't think the data is accurate enough to say which came first, it just
shows a close correlation between higher temperatures and higher CO2.
>
>>But if you agree that it is, we all know that burning fossil fuels
>>releases CO2, and that atmospheric CO2 levels have been rising, and that
>>CO2 adsorbs heat radiated from the earth that would otherwise escape into
>>space.
>>
>>So what is there to be skeptical about?
>
>The size of the effect, for one, ....
Yes, the temperature increases have been larger for a given increase
in CO2 than Arrhenius had predicted. But he didn't consider the increase
in water vapor (also a strong greenhouse gas) that would follow warmer
temperatures in a positive feedback loop.
>...and the claim that some very poorly
>understood confounding variables cannot be relevant, for another.
Yes, the exact consequences cannot be predicted; too many variables.
>
>>(Except maybe that warmer is
>>better)
>
>Well, I am Canadian....
Here in Wisconsin the effects are mixed. Bad for winter sports (X-country
skiing has been especially harmed), but the bicycle season is longer. Wet
springs have benefitted my garden, but I mow the grass more (bad) but does
look better (good). I have been able to sail longer into the fall.
>
>>Hmmmm. Inflation-expanding money supply; global warming-increased CO2.
>>For both of these, the correlation is not questioned, but the causality
>>is.
>
>Right.
>
>-- Roy L
Cause and effect are often in dispute. Wages correlate with productivity,
and some people that that it is the wage increase which is the cause, as
in the famous Henry Ford "pay the workers enough to buy the cars".
My favorite: a fellow worker once commented that I can bike to work (about
7 miles then) BECAUSE I am in good shape. I replied that I am in good
shape because I bike to work. And I remember the very first time I did. I
was about 30 years old and I was sore for days afterward. But I kept
doing it, and now I bike 14 miles to work with no problem (and I'm 68
years old).
Peter Lawrence
.
.
.
> Cause and effect are often in dispute. Wages correlate with productivity,
> and some people that that it is the wage increase which is the cause, as
> in the famous Henry Ford "pay the workers enough to buy the cars".
There's also the story of a Union boss who Ford told about a new factory
machine that could do the same work as employees at half the price. When he
was leaving, the Union boss asked Ford, "yes, but how many cars will it
buy?".
The reasoning is both right and wrong, depending on which level you are
looking at. There is an externality (OK, maybe pecuniary externalities can be
addressed differently, but let that pass - this is only for illustration).
The Ford story you quote, and the Union boss, omit the fact that Ford workers
spend elsewhere too, and consumers of Ford products don't only work for Ford.
IF they had, you would have had the death spiral of the Great Pullman Strike
whenever Ford's sector went into reverse (Pullman owned all its workers'
homes, and relied on recycling their wages as rent). So diversifying spreads
the risk in most circumstances, because each employer can cut back without
materially harming its own market - but the catch is that a general recession
still makes each employer think of retrenching as an option for recovery,
which gives a death spiral from the externality spreading of costs instead.
All very Tragedy of the Commons. (And yes, I know that that is not the only
thing going on - I'm just pointing out that this thing does go on among all
the other things.)
>
> My favorite: a fellow worker once commented that I can bike to work (about
> 7 miles then) BECAUSE I am in good shape. I replied that I am in good
> shape because I bike to work. And I remember the very first time I did. I
> was about 30 years old and I was sore for days afterward. But I kept
> doing it, and now I bike 14 miles to work with no problem (and I'm 68
> years old).
And there's my old favourite survivor bias as well. If you were in really bad
underlying shape, all that would have killed you and you wouldn't be telling
us this. So maybe it's more like Nietsche's "that which does not kill us
makes us stronger". Not that he was a good test case either. Extrapolating,
will you be cycling 21 miles (arithmetic progression) or 28 miles (geometric
progression) to work when you are 106? I am not sure that your numbers are
very meaningful.
Did you hear of the fellow who was asked why he always hit his head with a
brick? He replied that it was because it felt so good when he stopped. PML.
--
GST+NPT=JOBS
I.e., a Goods and Services Tax (or almost any other broad based production
tax), with a Negative Payroll Tax, promotes employment.
See http://users.netlink.com.au/~peterl/publicns.html#AFRLET2 and the other
items on that page for some reasons why.
Jim Blair
>Jim Blair wrote:
>
>.
>.
>.
>> Cause and effect are often in dispute. Wages correlate with productivity,
>> and some people that that it is the wage increase which is the cause, as
>> in the famous Henry Ford "pay the workers enough to buy the cars".
Peter Lawrence:
>
>There's also the story of a Union boss who Ford told about a new factory
>machine that could do the same work as employees at half the price. When he
>was leaving, the Union boss asked Ford, "yes, but how many cars will it
>buy?".
>
>The reasoning is both right and wrong, depending on which level you are
>looking at. There is an externality (OK, maybe pecuniary externalities can be
>addressed differently, but let that pass - this is only for illustration).
>The Ford story you quote, and the Union boss, omit the fact that Ford workers
>spend elsewhere too, and consumers of Ford products don't only work for Ford.
>IF they had, you would have had the death spiral of the Great Pullman Strike
>whenever Ford's sector went into reverse (Pullman owned all its workers'
>homes, and relied on recycling their wages as rent). So diversifying spreads
>the risk in most circumstances, because each employer can cut back without
>materially harming its own market - but the catch is that a general recession
>still makes each employer think of retrenching as an option for recovery,
>which gives a death spiral from the externality spreading of costs instead.
>All very Tragedy of the Commons. (And yes, I know that that is not the only
>thing going on - I'm just pointing out that this thing does go on among all
>the other things.)
Hi,
But it is clear that productivity gains are a necessary condition for wage
gains when the entire economy is considered. Otherwise even the poorest
countries would be rich.
http://www.geocities.com/capitolhill/4834/egg.txt
>
>>
>> My favorite: a fellow worker once commented that I bike to work (about
>> 7 miles then) BECAUSE I am in good shape. I replied that I am in good
>> shape because I bike to work. And I remember the very first time I did. I
>> was about 30 years old and I was sore for days afterward. But I kept
>> doing it, and now I bike 14 miles to work with no problem (and I'm 68
>> years old).
>
>And there's my old favourite survivor bias as well. If you were in really bad
>underlying shape, all that would have killed you and you wouldn't be telling
>us this. So maybe it's more like Nietsche's "that which does not kill us
>makes us stronger". Not that he was a good test case either.
I agree that not everyone can shape up by biking to work (7 to 14 miles--I
live in the same house, but work in a different place). But I claim that
the vast majority of people would be in better shape if they did.
>....Extrapolating,
>will you be cycling 21 miles (arithmetic progression) or 28 miles (geometric
>progression) to work when you are 106? I am not sure that your numbers are
>very meaningful.
I didn't mean to imply that this can be extrapolated into the future, just
that once you get used to biking 7 miles when young, doubling that when
you are much older is relatively easy. I wonder if I could bike 14 miles
to work today if I had not biked 7 miles to work when I was 30. I doubt
it.
Darren
"Peter Lawrence" <pet...@netlink.com.au> wrote in message
news:40E0D8...@netlink.com.au...
> Jim Blair wrote:
>
> .
> .
> .
> > Cause and effect are often in dispute. Wages correlate with
productivity,
> > and some people that that it is the wage increase which is the cause, as
> > in the famous Henry Ford "pay the workers enough to buy the cars".
>
> There's also the story of a Union boss who Ford told about a new factory
> machine that could do the same work as employees at half the price. When
he
> was leaving, the Union boss asked Ford, "yes, but how many cars will it
> buy?".
Flawed, of course. Not everyone who buys Fords works for Ford, and not
every dollar paid to Ford employees is spent buying Fords. But there is a
bigger flaw.... the idea that wages get spent, and profits don't. Henry
Ford's wage bill will be smaller, and his profits will be larger. Henry
will spend his profits on diamonds and mink coats.. and the people who make
_diamonds and mink coats_ will buy more Fords as a result.
Darren
Peter Lawrence
>
> "Peter Lawrence" <pet...@netlink.com.au> wrote in message
> news:40E0D8...@netlink.com.au..
> >
> > .
> > .
> > .
> > > Cause and effect are often in dispute. Wages correlate with
> productivity,
> > > and some people that that it is the wage increase which is the cause, as
> > > in the famous Henry Ford "pay the workers enough to buy the cars".
> >
> > There's also the story of a Union boss who Ford told about a new factory
> > machine that could do the same work as employees at half the price. When
> he
> > was leaving, the Union boss asked Ford, "yes, but how many cars will it
> > buy?".
>
> Flawed, of course. Not everyone who buys Fords works for Ford, and not
> every dollar paid to Ford employees is spent buying Fords.
You snipped where I pointed that out.
But there is a
> bigger flaw.... the idea that wages get spent, and profits don't. Henry
> Ford's wage bill will be smaller, and his profits will be larger. Henry
> will spend his profits on diamonds and mink coats.. and the people who make
> _diamonds and mink coats_ will buy more Fords as a result.
That flaw is not present in this story - mainly because it is trumped by the
first flaw. The reasoning behind the first flaw only connects Ford buying to
Ford work - so it can't connect Ford buying to whatever happens to the
profits EVEN IF they do get spent. PML.
Peter Lawrence
That reasoning is wrong, and so is the result.
You don't need productivity gains for wage gains - all you need is some sort
of redistribution (I'm leaving out the ethics and practicality of that for
the moment). Of course, you can't do that INDEFINITELY - but that wasn't a
requirement just there.
The poorest countries' predicaments have nothing to tell us on this point -
other things are going on there as well. For instance, a country that never
tried to distribute or generate gains wouldn't tell us anything one way or
the other, yet it would still be poor (and quite a few countries approximate
to that). PML.
Jim Blair
>Jim Blair wrote: (on causality: wages or productivity?)
>>
>> But it is clear that productivity gains are a necessary condition for wage
>> gains when the entire economy is considered. Otherwise even the poorest
>> countries would be rich.
>>
>> http://www.geocities.com/capitolhill/4834/egg.txt
Peter Lawrence <pet...@netlink.com.au> wrote:
>
>That reasoning is wrong, and so is the result.
>
>You don't need productivity gains for wage gains - all you need is some sort
>of redistribution (I'm leaving out the ethics and practicality of that for
>the moment). Of course, you can't do that INDEFINITELY - but that wasn't a
>requirement just there.
Hi,
Sure some people can gain wage (or income) increases without being more
productive. As you indicate, by taking theirs from others. But my "when
the entire economy is considered" was intended to mean that for everyone
to gain in real wages (or incomes), there must be gains in productivity.
>
>The poorest countries' predicaments have nothing to tell us on this point -
>other things are going on there as well.
Yes. My reference to poor countries being rich is that IF raising
(nominal) wages were the cause of increased wealth or increased
productivity, then any country could become wealthy by decree. Which I
say is absurd.
Johnny Marcos
>>The poorest countries' predicaments have nothing to tell us on this
>>point - other things are going on there as well.
>
> Yes. My reference to poor countries being rich is that IF raising
> (nominal) wages were the cause of increased wealth or increased
> productivity, then any country could become wealthy by decree. Which
> I say is absurd.
>
http://www.mises.org/efandi/ch13.asp
When in the 19th century the question was asked: What can be done in
order to raise wage rates and thereby to improve the average standard of
living of the most numerous class of the population, the economists
answered: One has to accelerate the increase of capital as compared with
population. This answer infuriated the reformers and socialists.
Historian Thomas Carlyle called economics the dismal science, and Karl
Marx smeared the economists as bourgeois idiots and sycophants of the
exploiters. But such abusive language cannot change the facts. Today the
statesmen of all underdeveloped countries realize very well that what is
needed to improve the lot of the masses of their peoples is investment
of additional capital. In spending dozens of billions of dollars for
foreign aid the American Government implicitly admits the correctness of
this thesis. And even the most fanatical foes of capitalism no longer
venture to deny that the comparatively high standard of living of the
manual workers in this country and in some parts of Europe is due to the
increase in the amount of capital invested per head of the employees.
Thus at least in dealing with the economic problems of underdeveloped
nations the President, Congress, and public opinion virtually
acknowledge the doctrine of the much abused classical economists. But in
dealing with domestic problems they are guided by very different ideas.
They proceed as if the height of wage rates could be fixed ad libitum
[at will] by government decree or by labor union pressure and
compulsion. Our tax system—especially the way in which personal incomes,
corporations and estates and inheritances are taxed—not only reduces
considerably the amount of savings, but in many regards directly results
in capital decumulation. But the authorities and their advisers are not
concerned about these effects. They are intent upon raising wage rates
either through decreeing minimum wage rates or through pro-union
policies.
Ron Peterson
> http://www.mises.org/efandi/ch13.asp
> When in the 19th century the question was asked: What can be done in
> order to raise wage rates and thereby to improve the average standard of
> living of the most numerous class of the population, the economists
> answered: One has to accelerate the increase of capital as compared with
> population.
Is von Mises setting up a straw man by not telling us which economist
said that?
> This answer infuriated the reformers and socialists.
Which reformers and socialists disagreed with the need to increase
investment in the means of production?
> Historian Thomas Carlyle called economics the dismal science, and Karl
> Marx smeared the economists as bourgeois idiots and sycophants of the
> exploiters.
That's not the same as saying there shouldn't be investment in the means
of production.
> ... And even the most fanatical foes of capitalism no longer
> venture to deny that the comparatively high standard of living of the
> manual workers in this country and in some parts of Europe is due to the
> increase in the amount of capital invested per head of the employees.
And they probably never did.
--
Ron