Thursday, September 08, 2005

All Peak Oil, All the Time part 5


I recently stumbled onto this rather old and silly postcard. I don't know what year it was printed, and it looks like a bulk printing where they could imprint the name of which ever city ordered them. The postage mark is for North Dakota. I would think there was something more photogenic in Ellendale ND, but perhaps not.

Is it not nicely typical? A US citizen bragging about power consumption. It seems that there are forces at work to make sure that is but a memory of the past.

I have a difficult time reading through the peak oil boards as they get all excited about mainstream recognition regarding their pet disaster. They usually have some trite and ready explanation about piles of evidence showing that we don't have to run out of oil anytime soon, such as this one example out of many:
Alberta is about to get wildly rich and powerful

What does that mean for Canada?

[...] “The oil sands give Canada one of the single greatest advantages of any state in the Western world,” says Paul Chastko, a University of Calgary historian who recently published a book called Developing Alberta's Oil Sands. “It gives Canada the ability to supply all of North America for the next 50 years without touching a drop of imported oil.” [...]
They are already pumping a million barrels a day out of there, with plans to triple production.

Cheney had planned to pay them a visit, but decided to cancel after Katrina hit. Canadians have a habit of losing control over their big industries, and if they follow the same pattern we may be able to see production slowed down a bit:
Memos Show Oil Companies Closed Refineries To Hike Profits

Jamie Court
The Huffington Post

If you believe the oil industry's response to Katrina, you'd think demanding environmentalists are to blame for $3 per gallon gasoline because the tree huggers shut down refineries with tough new rules. President Bush even mimicked the industry excuse by waiving environmental standards in the wake of Katrina. Well, the industry's own internal memos show the intentional shrinking of American refinery capacity in the 1990s was the oil companies' own idea to pump up profits.

Take this internal Texaco strategy memo:

“[T]he most critical factor facing the refining industry on the West Coast is the surplus of refining capacity, and the surplus gasoline production capacity. (The same situation exists for the entire U.S. refining industry.) Supply significantly exceeds demand year-round. This results in very poor refinery margins and very poor refinery financial results. Significant events need to occur to assist in reducing supplies and/or increasing the demand for gasoline.”

The memo went on to discuss a sucessful campaign in Washington State to shrink refined supply by removing other additives in the gasoline that filled gas volume.

Another Mobil memo shows the company promoted tough regulations in California to shut down an independent refiner. A Chevron memo acknowledged the industry wide need to shutter refineries and discussed how refiners were responding in kind.

Large oil companies have for a decade artificially shorted the gasoline market to drive up prices. Oil companies know they can make more money by making less gasoline. Katrina should be a wakeup call to America that the refiners profit widely when they keep the system running on empty. It's time for government to regulate the industry's supply. The fact that President Bush received $2.6 million from the oil industry for his reelection in 2004 should make regulation of the nation's gas supply one of the Democrats' most important talking points.
If there is such a thing as peak oil in our future it will be artificially manufactured.

The New Orleans port was the fifth largest in the world and the largest in the US, and the Bush Regime did not think it fit to spend the money to maintain it from a sure disaster predicted back in the 20th Century. I am not so sure this was gross incompetence.

More peak oil commentary thanks to Harry.

Previous posts on peak oil:

All Peak Oil, All the Time part 1, part 2, part 3, part 4

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