Oil's slippery slope

[mom cat]

THE ROVING EYE
Oil's slippery slope
By Pepe Escobar

BRUSSELS and DUBAI -

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This, in the long term, represents one of the explanations for the invasion of Iraq. In the short term, the administration of President George W Bush is in for a lot of trouble when oil-guzzling SUV (sport-utility vehicle) armadas of voters start making the connection between the unmitigated disaster in Iraq and oil at $50 a barrel and beyond. Analysts in Dubai estimate that the Iraqi premium - fueling uncertainty and speculation - adds at least $10 to each barrel of oil.


The world currently consumes 81.2 million barrels of oil a day (1 barrel = 159 liters), according to the International Energy Agency (IEA), the energy forum for 26 industrialized consumer nations. But the really alarming figure is 84 million barrels of oil a day: according to the IEA, this will be the global demand by 2005.

A few months ago, the same IEA was saying that demand in 2005 would be of only 82.6 million barrels a day. And more than a year ago, the IEA said we would reach 84 million barrels a day only by 2007 or 2008. This is leading analysts in Dubai to predict that demand - on a very optimistic scenario - will reach 120 million barrels a day in 2020. Additionally, this should mean that if demand continues to grow at the current frenetic level, all proven oil reserves in the world - at the best-estimate level - will be extinguished by 2054.



Colin Campbell makes no bones about it: for him, peak oil is already here, or around the corner in 2005. For years, Campbell - a PhD in geology at Oxford University in England and former chief executive for BP, Texaco, Amoco and Fina - has been a lonely voice contradicting the supremely powerful oil lobby, according to whom high technology and the invisible hand of the market must guarantee discovery and exploitation of reserves virtually forever.

Already in 2000, Campbell was charging that "oil giants are fooling the planet" and that everybody was myopic - especially producing countries. He was saying that "we only find a new barrel of oil for each four we produce". He is sure that the world has already consumed half of its proven oil reserves, and he is sure that the Middle East will again manipulate oil prices. It turns out that Campbell might have been wrong by a margin of only a few months: he was betting on a new oil shock by 2005, "when production will start to fall and reserves will begin to dwindle at a rate of 3% a year".

http://atimes.com/atimes/Global_Economy/FH24Dj01.html

[JohnyCanuck]

1. Rate of decline in post peak oil producers accelerating.

NEWS RELEASE

For Immediate Release:
Tuesday, 24 August 2004

The world is now losing more than a million barrels of oil a day to depletion – twice the rate of two years ago – according to a new analysis published this month in Petroleum Review, the oil and gas magazine of the Energy Institute in London.

The analysis shows that output from 18 significant oil-producing countries, accounting for almost 29 percent of total world production, declined by 1.14 million barrels a day (mb/d) in 2003. The annual rate of decline also appears to be accelerating, contrary to the widely held view that depletion progresses slowly.

Based on data in the latest BP Statistical Review of World Energy, production from this group of 18 countries peaked in 1997 at 24.7 mb/d and by 2003 it had fallen to 22.1 mb/d. In 1998 their total production dropped by less than one percent, whereas last year it declined by nearly five percent.

“It appears that depletion is now becoming a much more significant, though largely unrecognised, consideration in the supply-demand equation, and may be contributing to the rise in oil prices,” said Chris Skrebowski, Editor of Petroleum Review and a Board member of The Oil Depletion Analysis Centre (ODAC), who prepared the new analysis.

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www.fromthewilderness.com/free/ww3/082304_million_depletion.shtml

[JohnyCanuck]

2. Is Iran next on PNACs to-do list?

Latest article from Dale Alan Pfeiffer posted at www.FromTheWilderness.com speculates that the Bushies might have Iran in their gun sites partially because of its status as a swing producer (i.e. has excess oil pumping capacity). To view the full article you need to be a FTW subscriber. Limiting myeslf as usual to the standard DU 4 paragraph quote.


Target Iran

by
Dale Allen Pfeiffer

Well folks, we have had our next lotto drawing in the War on Terror, and it appears that we have a winner. Saudi Arabia? Pakistan? No, the next lucky target appears to be Iran. That's right. Given Mr. Bush's increasingly bellicose remarks about Iran, US embarrassment to find out that their first choice to head a new democratic Iraq, Ahmed Chalabi, was an Iranian spy, and Iran's announcement (however much truth there is behind it) that they are now members of the nuclear club, it would appear that our current administration has picked a new target in their ongoing War against Terror. Already the propaganda machine-excuse me-the media is hyping up reports stating the Iran had more to do with 9/11 than did Iraq. So it would probably behoove us, in our attempt to understand what this is really about, to look at Iran's oil resources and its strategic position with regard to the oil resources of neighboring territories. But first, I think we need to criticize the fundamental strategy of Georgy's War on Terror.

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The full importance of Iranian reserves lies in the belief that Iran is one of only five swing States-that is, countries with the capacity to increase oil production to make up for declining production elsewhere. The reserves of Iran, Iraq, and Saudi Arabia-along with Caspian and Central Asian reserves-are becoming increasing important in the face of revised reserve data and admissions from the industry that there is not as much oil left as we thought.

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With global oil production racing towards its peak, the neocons surrounding G. W. Bush are probably very eager to consolidate the Middle Eastern oil reserves of Iraq, Iran and Saudi Arabia into their empire. And so we have Bush's claims that the 9-11 terrorists are linked to Iran, even as we are still trying to keep a lid on Iraq and Afghanistan.33 There is a desperate need to bring on new oil production in an effort to reduce oil prices before they impact the global economy. With a certainty, the Bush administration is eying an Iranian pipeline to bring Caspian oil to market. Yet the CIA has already backed away from administration claims of a 9-11 Iranian connection, in a tango reminiscent of the buildup to the Iraqi Invasion.34

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Many have wondered why the Bush administration has done little to lower oil prices. Could it be that they are using the higher oil prices, and possibly the newest revelations about Saudi, OPEC and Russian oil production to prod certain key players into the realization of just how desperate the global situation is? If key members of the elite wake up to the fact that we are facing the end of the oil age, with no likelihood of developing a viable alternative, would they continue to worry about a little bloodshed and the loss of some profits? Or would they sadly condone a bloodthirsty attempt to establish an oil empire in the Middle East and Central Asia? Sorry if this sounds cynical and paranoid, but that is how the game is played in the world of movers and shakers.

www.fromthewilderness.com/members/082404_target_iran.shtml