Tuesday, July 15, 2008

Gas Lines coming this Fall

From SeekingAlpha:

The purpose of this essay is to highlight petroleum inventory issues likely to cause shortages this fall. Several events can create instant, grave shortages. Following is an incomplete list of known risks. There are still more unknown risks of unknown magnitude. As explained below, gas lines will be accompanied by a price jump of about $1.50 per gallon, even if crude oil does not increase in price...

The article contains some interesting graphics, which I am posting here:

This first graphic shows the pitfall between us and our deliveries of crude oil.

This second graph shows the oil stocks that we have already on hand, as inventory.

This is a simplified chart showing the steps that crude oil has to undertake to become gasoline and be delivered to your local gas station. Lots of opportunities for things to go wrong here.

This chart shows the availability, worldwide, of oil inventories for export. In other words, this is the oil available above and beyond a country's own internal usage that they can export to other nations. As you can see, that amount is growing smaller and smaller every year. The US, for example, has nothing to export, because we already use far more than we produce. Other countries are fast finding themselves approaching this same condition.

Here is an example of an oil exporter that is on its way to being unable to export oil. Their own internal national usage is growing at such as rate as to reduce, year by year, the amount of crude they have available for export. Basically, every other oil producing nation on the planet has a chart that looks very much like this one. Domestic usage is growing by leaps and bounds as more and more people reach "middle class" in developing nations - meaning there is less and less production available for export.

The US, of course, has no right whatsoever to insist that peoples in third world countries remain living in squalor - those people have every right to utilize their own natural resources to improve their own economy and raise the standard of living for their own people. The US is not entitled to anyone else's oil, class. Not one bit. So we're going to have to figure out how to run our economy on a fraction of our current usage - in other words, figure out how t live on only our own production capacity. The sooner the American public realizes this and accepts the fact, the better.

Of course, knowing America, our politicians will probably instead choose to bomb some other country and take their oil. You know, just like they're doing right now in Iraq. I wonder what country that will be? Hmmmmm....

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