Texas RRC Oil and Gas Production Data

The Texas RRC Production Data is out. There appear to be no big surprises this month. All RRC data is through September but the EIA data is only through August.

Note: For all those not familiar with the Texas Railroad Commission data it is always incomplete. That is the reason for the drooping data lines you see in the charts. The EIA data is what they believe the final estimate will be.

Texas C+C

Final month production was just a little higher in September than August. That usually indicates a small uptick in production. But the data is so incomplete it is hard to tell.

Dean C+C

Dr. Dean Fantazzini has Texas C+C with a slight uptick in September but still well below the March 2015 peak.

Texas Crude Only

Texas crude only reflects basically the same pattern as Texas C+C.

Dean Oil

Dean has Texas crude only also with a slight uptick in September.

Texas Condensate

Texas condensate should show a slight uptick in September when the final data comes in.

Dean Condensate

Dean has condensate almost flat since December.

Texas Total Gas

Texas total gas production also showed a slight uptick in September. All gas data is in MCF per day.

Dean Gas

Dean has Texas total gas with a slight uptick in September. Other than that big drop in January Texas gas production has been basically flat since December.

Texas RRC Gas Well Gas

The incomplete data shows a slight uptick in gas well gas but it don’t look like much is really happening here.

Texas Associated Gas

Texas associated gas, which has been responsible for all the increase in Texas gas production since 2011, seems to have leveled out.

The EIA publishes state by state natural gas prduction as well as state by state oil production. That data can be found here: EIA Natural Gas Their current data, like their oil data, is through August.

Texas Total Gas + EIA

Here is the EIA Texas natural gas production data compared with the RRC total gas data. All gas data is in MCF. that the EIA sees.  The EIA has Texas total natural gas spiking upward in June and August.

North Dakota Gas

And just in case you were wondering this is what the EIA says North Dakota’s gas production has been doing. The last data point is August, 2015.

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512 Responses to Texas RRC Oil and Gas Production Data

  1. I have, so far, reframed from giving much of an opinion on the Islamic Terrorist attacks in Paris. But I received, in my email box this morning, a link to a short podcast that reflects my opinions exactly.

    Still Sleepwalking Toward Armageddon

    • Jeffrey J. Brown says:

      Listened to the first six minutes or so, no argument from me.

      A direct link to a pretty amazing monologue, on the Islamic State/ISIS/ISIL strategy, from the 2015 season premiere of the TV series “Homeland.” Total segment is about three minutes long.

      https://www.youtube.com/watch?v=R8AldurlGKg

      “They’re there for one reason and one reason only: To die for the Caliphate and usher in a world without infidels. That’s their strategy and it’s been that way since the 7th Century.”

    • ChiefEngineer says:

      It’s hard to figure out what’s going on with all the lies and players. But you will find the heart of the problem based around religion, power and resources.

      I suspect ISIS is mostly rejected Sunni’s after the US invasion in 2003 when the Shiites were handed control over Iraq. A barbaric army of men without much to live for but raping and killing with terror. Using religion to justify it and trying to reclaim territory and power.

      I see little chance at all of resolving the problem without killing or capturing all of ISIS and than holding the country by military force for decades. We are talking millions of troops. Something on the scale of WWII to do it right.

      I think Obama’s hope is to supply the air power and intelligence with the bulk of the troops mostly being supplied from the surrounding countries. It took a couple of years to ramp up the American military before D-day and than another year to control the territory. The allies also spent a year degrading the Germans with airpower first. Maybe Fridays acts will unit the powers to be and the public for what seems to be required.

      Oh how I miss the good old days of Saddam and a Iraq no fly zone. Dick Cheney swatted the hornets nest and the world is living with the consequences.

      American hands are not exactly clean to this whole mess.

      http://www.brasschecktv.com/page/29145.html

      That’s my best guess today and I’m sticking with it until tomorrow

      • In general I agree with you. But Assad and the Russians can be the Western Front, the Iraqi Shiites the eastern front backed by Iran. The Kurds can take care of their own territory. Unfortunately the USA doesn’t make its own foreign policy. It has to get Israel Lobby blessing.

        • Stavros H says:

          What you are saying makes perfect military sense as well as counter-terrorist sense. But it will also mean total victory for the Russia-led coalition, and total defeat for the NATO-GCC coalition, or US-led coalition if you will.

          Hence, NATO will do everything/anything in its power to prevent that, or at least very significantly raise the cost for such a potential Russo-Iranian victory.

    • Javier says:

      The US military is finally trying to shut down ISIL’s oilfields

      http://qz.com/548820/the-us-military-is-finally-trying-to-shut-down-isils-oilfields/

      November, 13.

      More than a year since the US started attacking ISIL’s oil-led financial network, American bombers are finally being used in an attempt to entirely shut down the fields.

      As early as last September, oil experts from the region said that the best way to stop ISIL’s estimated $40 million a month in oil revenue was to destroy any equipment with rotating machinery or electric supply.

      Instead, though, US bombers appeared to attack mostly small refineries and some trucks. As a result, the flow of money to ISIL persisted.

      Now, though, put under pressure by Russian president Vladimir Putin’s foray into Syria and Iran’s more aggressive posture there, the US has begun to bomb the oilfields aggressively, according to a Nov. 13 report in the New York Times. Among the targets, the report says, are fuel-oil equipment and pumping stations.

      The Pentagon has dubbed the mission Tidal Wave II, after a World War II campaign called Operation Tidal Wave, which persistently attacked Hitler’s oil infrastructure in Romania and significantly reduced his oil supply.

      U.S. Warplanes Strike ISIS Oil Trucks in Syria

      http://www.nytimes.com/2015/11/17/world/middleeast/us-strikes-syria-oil.html?_r=0

      November, 16.

      ISTANBUL — Intensifying pressure on the Islamic State, United States warplanes for the first time attacked hundreds of trucks on Monday that the extremist group has been using to smuggle the crude oil it has been producing in Syria, American officials said.

      According to an initial assessment, 116 trucks were destroyed in the attack, which took place near Deir al-Zour, an area in eastern Syria that is controlled by the Islamic State.

      The airstrikes were carried out by four A-10 attack planes and two AC-130 gunships based in Turkey.

      Plans for the strike were developed well before the terrorist attacks in and around Paris on Friday, officials familiar with the operation said, part of a broader operation to disrupt the ability of the Islamic State, also known as ISIS or ISIL, to generate revenue to support its military operations and govern its territory.

      American officials have long been frustrated by ability of ISIS to generate tens of million of dollars a month by producing and exporting oil.

      To disrupt that source of revenue, American officials said last week that the United States had sharply stepped up its airstrikes against infrastructure that allows ISIS to pump oil in Syria.

      Until Monday, the United States had refrained from striking the fleet used to transport oil, believed to include more than 1,000 tanker trucks, because of concerns about causing civilian casualties. As a result, the Islamic State’s distribution system for exporting oil had remained largely intact.

      The new campaign is called Tidal Wave II. It is named after the World War II effort to counter Nazi Germany by striking Romania’s oil industry. Lt. Gen. Sean B. MacFarland, who in September assumed command of the international coalition’s campaign in Iraq and Syria, suggested the name.

      To reduce the risk of harming civilians, two F-15 warplanes dropped leaflets about an hour before the attack warning drivers to abandon their vehicles, and strafing runs were conducted to reinforce the message.

      The area where the trucks assemble in Syria has been closely monitored by reconnaissance drones. As many as 1,000 trucks have been observed there, waiting to receive their cargo of illicit oil.

      On Monday, 295 trucks were in the area, and more than a third of them were destroyed, United States officials said. The A-10s dropped two dozen 500-pound bombs and conducted strafing runs with 30-millimeter Gatling guns. The AC-130s attacked with 30-millimeter Gatling guns and 105-millimeter cannons.

      The pilots saw several drivers running to a nearby tent and did not attack them, an American official said, and there were no immediate reports of civilian casualties.

      Col. Steven H. Warren, a Baghdad-based spokesman for the American-led coalition, confirmed that A-10s and AC-130s had been used in the attack and that 116 tanker trucks had been destroyed.

      “This part of Tidal Wave II is designed to attack the distribution component of ISIL’s oil smuggling operation and degrade their capacity to fund their military operations,” Colonel Warren said.

      The strike comes just days after Kurdish and Yazidi fighters, backed by American airstrikes, cut an important road, Highway 47, that ISIS has used to move supplies and fighters between Syria and Mosul, Iraq’s second largest city, which was captured by the militant group last year.

      That road was cut on Thursday, and Kurdish and Yazidi fighters retook the Iraqi city of Sinjar the next day.

      The American operation against the oil trucks followed a French on raid Sunday on two Islamic State targets in Raqqa, Syria, which allied officials identified as a headquarters building and a training camp.

      More than 20 bombs were dropped by French planes in the attack, an allied official said. It is not clear how much damage was caused, and no secondary explosions were observed.

      As always, oil is behind many of the important events that we watch taking place.

      • jjhman says:

        Pardon me but if this reporting is real then the US government is even more incompetent than I ever imagined. We’ve avoided destroying over 1,000 trucks because we feared injuring civilians? then all of a sudden we have a totally simplistic way to destroy the trucks and avoid hurting any innocents? Then we brag about destroying 116 trucks out of 295?

        C’mon. If we were serious we wouldn’t stop until there wasn’t a single truck, truck driver or road for them to move that oil.

        Don’t get me started about a French “furious retaliation” where they dropped 20 bombs from 10 airplanes.

        • Watcher says:

          Tens of millions of dollars a month. Call it 30 and $360 million/yr.

          1) Then why interdict, which the supply and demand apostles would suggest raises the price, getting them more money for whatever gets through.

          2) $360 million a year is pocket change to any of the countries there with a Central Bank, who can print that in a quiet morning and electronically recharge ISIS debit cards.

          • Dennis Coyne says:

            Hi Watcher,

            The high prices can effect the economy and it is the total revenue that matters. For example if the supply is cut in half and prices double, the policy would have no effect on revenue, but prices might not double, maybe people would use fuel more efficiently and prices would only rise by 25%, in that case oil revenue is reduced and the policy works.

            You do not seem to understand basic economics.

            • oldfarmermac says:

              After reading Watcher’s comments for months, I can only conclude that he has only one basic insight the rest of us ought to keep in mind.

              That insight is that various governments, including our own, will spend a lot of money, either collected tax money, or printed money, to ensure that oil remains available in sufficient quantity, without a shortage causing a panic.

              Now when it comes to printed money, most people do not seem to understand that in the last analysis, it is a tax on EVERYBODY,excepting the recipients thereof.

              In economics there are win lose games, breakeven games, and win win games to be played.

              Printing money is a way to take a little from a lot of people and giving it to who ever the government wants to have it, whether an oil company or a drug company or schools or grand scale scam artists, such as for profit universities.

              Saying which sort of game it is, when it comes to oil, is not easy.
              We sure as hell MUST have oil, in the short to medium term, at affordable prices and in sufficient quantity to prevent an economic heart attack.

              Longer term, we should be able to deal with expensive oil in limited quantities, so long as the price doesn’t go up TOO FAST and the quantity down TOO FAST.

              A big subsidy to producers, IF it prevented changes in price and supply from coming too fast, would be a good deal for everybody, short term.

              Long term it would be a bad deal, because it would prevent us from adapting by using less oil and using it more efficiently.

              • Javier says:

                Completely agree, OFM,

                A subsidy to oil producers even in the form of credit means a tax or credit reduction to oil consumers and a market distortion. Oil consumers will be less capable of affording oil so it will reduce demand increasing current imbalance instead of reducing it.

                Oil industry needs consolidation and our economy needs to use less oil and more rationally. When oil production falls enough we could have a very severe oil crunch and we should prepare for that. In any case we are moving towards a world with less oil.

              • ChiefEngineer says:

                Hello Mac,

                “Printing money is a way to take a little from a lot of people and giving it to who ever the government wants to have it”

                This statement really doesn’t give justice as to how the system works. It’s true that expanding the money supply can devalue the purchasing power of a currency by to much money chasing to few goods(inflation). Currently the Fed has a target of 2% inflation and the country is running less that that. For almost 10 years now the Fed has had an easy money policy to stimulate demand and hasn’t reaching it 2% inflation goal and/or full employment. The Fed talks monthly about tightening money policy as to not over shoot their 2% goal and is prepared to do so. The Fed doesn’t have a secret plan to take a little away from everyone and give it away to who it wants.

                I believe your statement misleads a lot of people who don’t understand this complex system of money supply and currency stabilization.

        • TechGuy says:

          The US likely has been indirectly aiding ISIS, as a means to remove Assad from Syria. Much of the arms supplied from the US for the war in Syria ended up in ISIS’s hands. The US had no intention of engaging ISIS to disarm them. Recall when the Roman empire began to decline, they turn to mercenary armies to fight in proxy wars because the emperors could no longer obtain public support to send Roman troops to engage in overseas wars.

          Some say the French Terror was part of the plan to continue to distract nations from economic problems and to increase gov’t control (more state control of the economy, and to relieve civilians of their liberties).

          In my opinion the gov’t had to know that permitting radical muslims into their borders would have terrible outcome. There are only two possibilities: Gov’t are run by clueless idiots, or they have a nefarious agenda.

          For years I suggested that sooner or later their would be another rise of fascism in Europe. At the time, and probably still, most people dismissed this and thought I was crazy. Its coming.

          I continue to discuss that the world is marching towards another global war. Yet, everyone still thinks I am crazy. War is coming. If you don’t believe it, your going down a path of self or collective delusion.

      • PeakSigns says:

        I still don’t believe that this oil they produce is the primary source of their funding. Who is buying this illicit oil? Turks? Iranians? You would think they would need a substantial amount of it (crudely refined) to be used in trucks, APCs, generators, etc.

        I think they are being directly funded by wealthy donors in KSA and Qatar and perhaps even covertly funded by those governments.

        And I don’t think $30 million per month (with no other funding) is really going to get you that far in funding a standing army large enough to fight the Iraqi army, the Peshmerga in Iraq, Kurds in Syria, Syrian govt forces, Hezbollah, and Nusra. And police the populace in their territory. But maybe they pinch pennies better than I do…

    • Clueless says:

      I listened to it all. Best post from Ron since I have been here.
      The day after the Paris “events,” I remembered something from over 60 years ago, when I was 10 or 12 years old. Learning that Lemmings en-mass ran over cliffs into the oceans and drowned. I remember thinking, “how stupid can mammals be?” Well, it turns out that humans are no different than Lemmings.

      • Synapsid says:

        Clueless,

        I learned about Norwegian lemming migrations at about the same time, from an Uncle Scrooge comic book. I wish I still had it.

        They were great: introduced me to the Seven Cities of Cibola, cenotes in Yucatan, course changes of the Mississippi River, the lake lands of northern Minnesota and rare-earth metals, Whitehorse, the effect of oversupply on prices…

        I know of nothing better for the Young Inquiring Mind. Or for mine, either.

    • The Wet One says:

      That’s a pretty good link Ron. There’s definitely grist for the thought mill there.

      It is likely true that we will be dealing with Paris like attacks for the rest of our lives (I’m 40, so I’ve got a bit more “rest of my life” than you, if I’ve understood things correctly). Some honesty about the problem we face and a focus on the ideas that give rise to those who employ the terror tactic will be useful. I don’t know if that honesty will be enough.

      Time shall tell.

      • Paulo says:

        Thanks Ron for the link.

        While safely ensconced here on the BC west coast, I have family in Paris. Last years Charlie Hebdo attack took place in the same block where a niece lives. The final shootout took place a mile from another niece’s home. For this one we have enquired as to the situation and have yet to hear back. As I told my sister, a city of 12 million people….it’s all about odds. 4 family members in Paris:12 million. Still haven’t heard back. As James Bond might say; “shaken, not stirred”.

        Anyway, thoughtful podcast. Wondering now how CNN will extricate themselves from non-stop talking head coverage? Maybe this Charlie Sheen Aids thing…..(and yes, that was intended to be a snide commentary on the state of our collective coverage on this onslaught against almost everything.) What’s next, destruction of antiquities and book burnings? Hospital bombings? Oh yeah…..

        • notanoilman says:

          Suerte.

          NAOM

          PS Any way to send a PM on this blog?

        • R Walter says:

          I listened to the fifteenth minute, all they have to do is stop what they are doing. It is that simple. Just do the one thing that will work, stop. It is going to be easy, better than what is being done now. There is the answer, stop.

          It has all happened before, the crusades were something of the same kind of thing, a parallel. Constantinople was sacked in 1204 by Crusaders which caused the schism between the Eastern Orthodox Church and the Roman Catholic Church to be more or less permanent.

          https://graceuniversity.edu/iip/2011/08/11-08-20-2/

          “It was the crusades which made the schism definitive with the worst of it occurring in 1204 when the Crusaders from the west who were originally bound for Egypt, ended up sacking Constantinople. The Crusaders looted, terrorized and vandalized Constantinople for three days. many ancient and medieval Roman and Greek works were either taken or destroyed. Many priceless artworks made of bronze, including the statue of Hercules created by the legendary Lysippos, court sculptor to Alexander the Great, were melted down for their content by the Crusaders. The famous bronze horses from the Hippodrome were sent back to adorn the facade of St Mark’s Basilica in Venice. They are still in Venice in a museum. The Library of Constantinople was destroyed. The Crusaders violated the city’s holy sanctuaries, destroying or stealing all they could lay hands on. Thousands of civilians were killed in cold blood. Women, even nuns, were raped by the Crusader army. The very altars of these churches were smashed and torn to pieces for their gold and marble by the warriors who had sworn to fight in service of Christendom without question.

          The sack weakened the Byzantine Empire, which allowed the Ottoman Turks, to conquer the area and enslave the Greek Christian population for 400 years of terror.”

          https://graceuniversity.edu/iip/2011/08/11-08-20-2/

          That’s the way it goes moving west.

          Ain’t nothin’ new under the sun.

          • Javier says:

            You are wrong in both accounts.

            What Islamic fanatics want is that we do not exist. There have been millions of Christians living in Muslim lands for centuries. They belong to different Oriental denominations and they are disappearing very fast in almost every Muslim country. Even in Turkey, a NATO member since 1952, Christians, that were 20% of the population only 100 years ago, are facing extinction now. In Irak and Syria they are simply exterminated.

            Every Muslim in the world believes that lands that belonged to Islam once should become part of Islam again. It is part of their religious core beliefs. This means that they think that Spain should be part of Islam again.

            You cannot appease the people that want your destruction. While we can come to terms with Muslims that are unwilling to attack Christians as their faith demands, we must combat every Muslim that acts upon his beliefs and attacks Christians.

            Regarding the attack on Constantinople by Frankish crusaders led by Venetians in 1204 as being responsible for today’s separation of Orthodox Church, it is a beautiful theory, but nothing supports it. The basis of the separation of Eastern and Western Churches is the division of the Roman Empire that made the Pope of Rome and the Patriarch of Constantinople equals in power and thus not willing to accept the other’s authority. The divisions became profound over the fourth council of Constantinople in 870, not recognized as ecumenical by the Eastern Church over the issue of Patriarch Photius, a layman that could not be a Patriarch to Rome and a saint to Constantinople. The division became irreconcilable after the Norman conquest of Sicily in 1054 when the isle’s Greek population was forced to adopt the Western rite, and Constantinople forbade the Western rite leading to the excommunion of the Patriarch. But it was actually after the fall of Constantinople in 1453 when under Sultan’s pressure all Eastern Churches were forced to repudiate any authority by Rome that the Eastern Church became completely separated from the Western.

            Once religions become separated not only in authority, but also in beliefs and rites, it is almost impossible for them to reunite. To think that the crusaders pillage of Constantinople was decisive in the Eastern-Western Christian split is to entertain a fantasy.

            • R Walter says:

              Ok, I am wrong, you don’t have to get so mad.

              Anyhow, the French are on a crusade right now to apprehend the perpetrators, the culprits have been detected today.

              I suppose the Statue of Liberty is a target, that was made in France. The giant statue of Jesus, Christ the Redeemer, in Rio de Janeiro is probably another target. Every continent must sacrifice its fair share. Can’t rule out the Lincoln Memorial as a prime target, or the US Capitol as target numero uno.

              The Three Gorges Dam would be another prime target.

              By that time, it won’t be good for anybody.

              If it won’t stop and it all continues as such, there won’t be much left. At some point, the Waterloo will happen.

              • Javier says:

                Spain has a very long experience with terrorism. Between 1975 and 2011 a separatist Basque terrorist group killed 829 people. From the beginning and during the presidencies of Giscard d’Estaign and Mitterrand, France offered sanctuary to the terrorists and refused to prosecute and extradite terrorists in their country. As a result of this decades long pro-terrorist policy of France hundreds of Spaniards died. They even used this policy as a political tool to extract political and economical concessions from the Spanish government and for example our high-speed trains had to be bought from France over Germany in exchange for an improvement in anti-terrorist cooperation.

                This French pro-terrorist stance diminished with Chirac and finally came to an end with Sarkozy. The end of the French sanctuary after almost four decades was instrumental in ending the terrorism. The French are lucky that the Spaniards are not a rancourous people.

                The Spanish experience with terrorism demonstrates that you don’t have to reduce your liberties to fight terrorism. It is instrumental to reinforce justice tools to prosecute anybody affiliated in any way with the terrorists and specially to attack their sources of finance. That is what finally made them in. Despite that, one has to be prepared to accept that we are going to pay a very dear price.

                Responding to terrorist attacks with the bombing of cities only breeds more terrorists.

                Hollande is making mistake after mistake. You don’t change your constitution because of a terrorist attack. You don’t order the bombing of a city. You don’t invoke an European clause of self-defense to force your allies to go beyond what they offer because of a terrorist attack. The French presidency has not been up to the occasion. We live in times of lack of enlightened leadership.

                • Ulenspiegel says:

                  Javier,

                  it is a pity that most people do not get it what you wrote in your last paragrah, instead they give the terrorists what they want.

                  • Glenn Stehle says:

                    It’s scary what Hollande is doing with his “emergency measures.” Here’s what CBS had to say about it last night:

                    https://youtu.be/VLdzdcrDtDc?t=125

                    The means of defence against foreign danger have been always the instruments of tyranny at home. Among the Romans it was a standing maxim to excite a war, whenever a revolt was apprehended. Throughout all Europe, the armies kept up under the pretext of defending, have enslaved the people.
                    ― James Madison, Notes of Debates in the Federal Convention of 1787

                • Ves says:

                  Javier,
                  Hollande is not making mistake. You are making mistake on how you perceive whom he represent. He represents Lois Vutton and Tiffany crowd, so 1% crowd. Holland is doing the same thing that all politicians in France have been doing for centuries. Arm and divide the natives and then come as cavalry on aircraft carrier as peacekeepers. If you read the history on how countries in the North Africa were formed you will know how the French, as they were retreating from their colonies, were “poisoning the wells” by creating fake countries from several different ethnic and religious groups. Divide and Conquer. There is no better and low cost way to pull the strings in the far lands from Versailles.

                • Hollande is a pin head.

              • Fred Magyar says:

                I suppose the Statue of Liberty is a target, that was made in France.

                Yep, there used to be a watering hole within walking distance of my home in Hollywood Florida where I would occasionally stop for a beer. One day I noticed a sign in the window with the inscription: “Boycott French Products”. So I casually asked the owner if he would sign a petition to have the Statue of Liberty dismantled and returned to France? He seemed to be at a loss for an answer. Ironically they are no longer in business and there is now a restaurant in that space, called Exotic Bites, the owner is an Egyptian…

    • Glenn Stehle says:

      I always enjoy watching the fur fly when Sam Harris and Scott Atran debate radical Islam.

      Atran has worked decades interviewing and counseling young people who have converted to radical Islam, so speaks with a great deal of firsthand knowledge when it comes to the ideology.

      Ralph linked to an article by Atran on the last thread, which can be found here:

      http://peakoilbarrel.com/bakken-big-decline-in-september/comment-page-1/#comment-546566

      Atran stakes out the exact opposite position that Harris does. He asserts that Isis’ popularity has very little to do with its theology or religious teachings.

      Instead, Atran argues, its appeal is due to its secular, non-religious aspects.

      Atran states that radical Islam “conscientiously exploits the disheartening dynamic…in Europe in ways reminiscent of the hatchet job that the communists and fascists did on European democracy in the 1920s and 30s.”

      “As I testified to the US Senate armed service committee and before the United Nations security council,” Atran adds, “what inspires the most uncompromisingly lethal actors in the world today is not so much the Qur’an or religious teachings. It’s a thrilling cause that promises glory and esteem.”

      “It’s communal,” he continues. “They join a ‘band of brothers (and sisters)’ ready to sacrifice for significance.”

      Atran is not the first to argue that radical Islam has its origins in the revolutionary secular ideologies which engulfed Russia and Germany in the first half of the 20th century.

      Malise Ruthven, for instance, writes in A Fury for God, The Islamic attack on America that “the revolutionary vanguard Qutb advocates does not have an Islamic pedigree… The vanguard is a concept imported from Europe, through a lineage that also stretches back to the Jacobins, through the Bolsheviks and latter-day Marxist guerillas such as the Baader-Meinhof gang.”

      “Qutb’s ideas about revolutionary struggle were of recent European vintage,” John Gray asserts in Al Qaeda and What It Means to Be Modern.

      Or as Leonard Binder puts it in Islamic Liberation: A Critique of Development Ideologies, Qutb “seems to have adopted the post Kantian aesthetic.”

      “The intellectual roots of radical islam are in the Eurpean Counter-Enlightenment,” Gray concludes. “It is the fact that radical Ialam rejects reason that shows it is a modern movement. The medieval world may have been unified by faith, but it did not scorn reason.”

      • Nick G says:

        Atran is not the first to argue that radical Islam has its origins in the revolutionary secular ideologies which engulfed Russia and Germany in the first half of the 20th century.

        Are you sure that’s his argument? He seemed to be drawing a parallel between their tactics, not a causal line.

      • Nick G says:

        The medieval world may have been unified by faith, but it did not scorn reason.

        I agree that much of the energy of today’s fundamentalism comes from a rejection of modern ideas, which makes it far more rigid than earlier religious practice. But, the idea that faith is entirely compatible with reason seems puzzling.

        Isn’t faith dependent on reliance on authority, rather than thinking things through on one’s own?

      • Glenn Stehle says:

        Nick G,

        I have been following the debate between Sam Harris and Scott Atran since their showdown at The Science Network’s “Beyond Belief” conference in 2006. You can watch it here:

        https://www.youtube.com/watch?v=8VWO6U6248c

        https://www.youtube.com/watch?v=Wu6qQDphSGU

        https://www.youtube.com/watch?v=BRKbBsl6KaQ

        Atran states that he believes radical Islam is like all the other messianic secular “isms” which emerged during the 20th century — communism, anarchism, etc. — which he calls “secular versions of Christianity.”

        Atran presents as evidence a massive empirical survey, with more than 10,000 respondents, which shows that the ideological adherents with the greatest “tendency to scapegoating” and who are the most “violent and inflexible in their beliefs” are Catholics, atheists, and Orthodox Christians. Those who exhibit the least of these traits are Buddhists, Hindus and Muslims.

        Atran cites more evidence in his recent testimony before the Security Council of the United Nations, which can be heard (or the transcript read) here:

        http://blogs.plos.org/neuroanthropology/2015/04/25/scott-atran-on-youth-violent-extremism-and-promoting-peace/

        Following are some of the things Atran had to say about the youth that has taken “the path of violent extremism” in his UN presentation:

        [W]ho are these young people?

        • When asked “what is Islam?” they answered “my life.” They knew nothing of the Quran or Hadith, or of the early caliphs Omar and Othman, but had learned of Islam from Al Qaeda and ISIS propaganda, teaching that Muslims like them were targeted for elimination unless they first eliminated the impure.

        • Most have had no traditional religious education, and are often “born again” into a socially tight, ideologically narrow but world-spanning sense of religious mission. Indeed, it is when those who do practice religious ritual are expelled from the mosque for expressing radical political beliefs, that the move to violence is most likely.

        • [I]n Barcelona just this month 5 of 11 captured ISIS sympathizers who planned to blow up parts of the city were recent atheist or Christian converts.

        Atran goes on to conclude that

        the popular notion of a “clash of civilizations” between Islam and the West is woefully misleading. Violent extremism represents not the resurgence of traditional cultures, but their collapse…

        It was known at the time of the 2006 “Beyond Belief” conference that the New Atheists (Harris is one of the “Four Horsemen of New Atheism”), along with their fellow travelers some very promient neoclassical economists, were the high priests of the cult of the self. (See, for instance, Moral Sentiments and Material Interests by Herbert Gintis eta al, published in 2005.)

        It would not be fully revealed, however, until 2013 that the New Atheists are hardline, card-carrying members of the U.S. war party, for which they were duly called out by Glenn Greenwald, Nathan Lean, and many others:

        http://www.theguardian.com/commentisfree/2013/apr/03/sam-harris-muslim-animus

        http://www.salon.com/2013/03/30/dawkins_harris_hitchens_new_atheists_flirt_with_islamophobia/

        • Nick G says:

          It would not be fully revealed, however, until 2013 that the New Atheists are hardline, card-carrying members of the U.S. war party

          This seems to argue that M.E. war is not about religion, but rather US intervention:

          “Indeed, even a Pentagon-commissioned study back in 2004 – hardly a bastion of PC liberalism – obliterated Harris’ self-justifying stereotype that anti-American sentiment among Muslims is religious and tribal rather than political and rational. That study concluded that “Muslims do not ‘hate our freedom,’ but rather, they hate our policies”: specifically “American direct intervention in the Muslim world” — through the US’s “one sided support in favor of Israel”; support for Islamic tyrannies in places like Egypt and Saudi Arabia; and, most of all, “the American occupation of Iraq and Afghanistan”.”

          http://www.theguardian.com/commentisfree/2013/apr/03/sam-harris-muslim-animus

          Which seems to support the argument that indeed…war in the M.E. is all about oil, and that the US would prevent the loss of a lot of blood and wealth by transitioning away from oil ASAP.

          • Glenn Stehle says:

            Nick,

            I don’t know if the “war in the M.E. is all about oil,” but the narrative that Harris and Murray are peddling — that it’s all about irrational religious passions — is certainly incorrect.

            As Michael Allen Gillespie said of the “religious wars” that ravaged Europe during the 16th and 17th centuries:

            While we call them the Wars of Religion, it would be a mistake to assume that religion alone was responsible for the carnage. Political, dynastic, and nationalistic factors clearly played a role in fomenting, perpetuating, and exacerbating the conflict.

            • Don Wharton says:

              It would be great if Glenn stopped posting his absurd attempts to keep us from seeing the stark evil of religious dogma. Much of the religious warfare in European history was framed specifically in religious terms. Almost all of the battle lines that either now exist or are likely to exist in the Middle East will be precisely determined by religious differences. There are a great many mothers of dead terrorists who celebrate what their sons have done and express the hope that their remaining progeny will pursue the same religious obligation.

              • Glenn Stehle says:

                Don,

                The grotesquely reductionist explanation of highly complex phenomena which you offer up, in defiance of all the evidence to the contrary, is what has largely discredited New Atheism.

                The bottom line, at least for anyone with even the most rudimentary knowledge of history, is this: There is no singlular cause which can explain the evils perpetrated by mankind, and thus there is no silver bullet to slay those evils.

                The French Revolution, with its extravagant claims for the rule of reason and its abysmal realization of these clams in the Terror, should have made the limitations of the modern project abundantly apparent

                Scott Atran, in his closing remarks at the “Beyond Belief” debate with Sam Harris, summed up the problem as follows:

                I agree there’s lots of nonsense in the world, and that science may or may not, even though I see no historical evidence of what science has done for morals yet, or ethics or politics or anything else – in fact I’ve seen the contrary – but, let’s suppose there is. And let’s suppose it’s a good mission to get rid of the nonsense in the world. This is the problem which you are not facing: how to advance science and reason in a fundamentally irrational world. Not to wish it go go away. Not to believe that by rational argument it will go away. But how to deal with that problem. It is a very, very hard problem.

                • Dennis Coyne says:

                  Hi Glenn,

                  Lots of people prefer simple explanations. It is often a problem even in very sophisticated analyses.

                  For some the focus is power, for others it is religion, for others it is energy, and for some it is debt.

                  Many people have their pet “essentialisms” as Resnick and Wolff like to call them. An analysis that doesn’t boil everything down to a single essential concept from which everything else flows, is hard to find. The world is a complex place and particularly for social science there are many different ways of looking at things.

                  I agree with your main point that very simple explanations are inadequate. Keep in mind that on a blog most people are trying to be concise [not me 🙂 ]

                  • Glenn Stehle says:

                    Dennis,

                    I agree that people have what seems to be an almost instinctive drive to over-simplify. But these simplifications should not be confused with factual reality. Leo Tolstoy put it this way in War and Peace:

                    The human mind cannot grasp the causes of phenomena in the aggregate. But the need to find these causes is inherent in man’s soul. And the human intellect, without investigating the multiplicity and complexity of the conditions of the phenomena, any one of which taken separately may seem to be the cause, snatches at the first, the most intelligible approximation to a cause, and says: “This is the cause!”

                • The grotesquely reductionist explanation of highly complex phenomena which you offer up, in defiance of all the evidence to the contrary, is what has largely discredited New Atheism.

                  The idea that highly complex phenomena can only be explained by the hand of God is obviously what you are driving at. Such belief is based on ignorance, ignorance of science and the worst kind of ignorance of all, the belief that the answers can be found in religion.

                  There is no such thing as New Atheism! Atheism is as old as religion itself. Well, perhaps almost as old as religion. There has always been superstition in the world and religion sprang from ignorance and superstition.

                  Religion is still battling science and that is all you are doing Glenn. Pretending that there is some organization or group of people that go by the name of “New Atheism” is just your stupid attempt to create a straw man so you can slay him in the name of ignorance and superstition. (i.e. religion).

                  • Glenn Stehle says:

                    °°°°Ron Patterson says:

                    The idea that highly complex phenomena can only be explained by the hand of God is obviously what you are driving at.

                    No, that’s not at all what I’m driving at.

                    What I’m driving at is that many of the criticisms, and for me what are the most interesting criticisms, leveled at the New Atheists come from other atheists, or from other scientists (whether they be atheist or not).

                    What I’m driving at is that there should be no atheist ‘acid test’ required before someone’s evidence, or the hypotheses which they draw from that evidence, are deemed to be valid.

                    Here’s how Stephen Jay Gould described the “Darwinian fundamentalists,” or “ultras,” as he called them:

                    Since the ultras are fundamentalists at heart, and since fundamentalists generally try to stigmatize their opponents by depicting them as apostates from the one true way, may I state for the record that I (along with all other Darwinian pluralists) do not deny either the existence and central importance of adaptation, or the production of adaptation by natural selection….

                    “Straight is the gate, and narrow is the way.” Fundamentalists of all stripes live by this venerable motto, and must therefore wield their unsleeping swords in constant mental fight against contrary opinions of apostates and opponents… [T]he basic ideological weapon of fundamentalism rarely departs much from the tried and true techniques of anathematization.

                    Unfortunately, at least for the ideals of intellectual discourse, anathematization rarely follows the dictates of logic or evidence, and nearly always scores distressingly high in heat/light ratio.

                    http://www.nybooks.com/articles/archives/1997/jun/12/darwinian-fundamentalism/

                    °°°°Ron Patterson says:

                    There is no such thing as New Atheism!

                    Well, I suggest telling that to Victor J. Stenger, an author and physicist and one of seminal, leading lights of New Atheism. He published a book titled The New Atheism: Taking a Stand for Science and Reason in 2009.

                    This is from the Amazon webpage for the book:

                    The authors of these books—Richard Dawkins, Daniel Dennett, Sam Harris, Christopher Hitchens, and Victor J. Stenger—have come to be known as the “New Atheists.” ….

                    The New Atheism is a well-argued defense of the atheist position and a strong rebuttal of its critics.
                    http://www.amazon.com/The-New-Atheism-Taking-Science/dp/1591027519

                  • Glenn, I will not get into the Gould debate. Gould has gone and can no longer defend himself. That is why Dawkins quit pointing out the very stupid things that Gould wrote. He just wanted to let Gould rest in peace.

                    But I did follow that debate while Gould was alive. And Dawkins made Gould look like an idiot at every turn. Now Gould was a very smart man, he just had a blind spot, he was an ideologist. Gould wrote high praises about the Stephen Rose et. al. book “Not In Our Genes” which tried to argue that intelligence was not inherited. And Dawkins took him to the woodshed for it. That and other things.

                    Glenn, just because someone writes a book about a group of people and calls them “The New Atheist” does not mean that such an organization actually exist. It does not. The men exist but such an organization does not. Therefore you cannot ascribe to them qualities that can only be ascribed to an organization. They don’t have a “membership” roll so you cannot say Blacks or Hispanic are not included since no one is included. And you cannot say they mistreat women or whatever since there is no organization to mistreat anyone. You cannot ascribe qualities to a group when there is no such group.

                • Nick G says:

                  Glenn,

                  I agree that religion is not the sole cause of evil.

                  On the other hand, that doesn’t mean that supernatural explanations of the world are helpful. On the contrary, they push us in the direction of irrationality and deference to authority, and support authoritarian relations and violence.

                  Just because people reject religion doesn’t mean that they’ve become rational – irrational culture and psychology is very persistent. But, religion gets in the way of becoming rational.

                  • Glenn Stehle says:

                    °°°°Nick said:

                    …that doesn’t mean that supernatural explanations of the world are helpful. On the contrary, they push us in the direction of irrationality and deference to authority, and support authoritarian relations and violence.

                    Is that what the Rev. Martin Luther King’s religion did?

                    Mahatma Gandhi’s?

                    Albert Einstein’s?

                    Nick said:

                    …religion gets in the way of becoming rational.

                    No denying that, if by being rational what you mean is not departing from factual reality.

                    But why single out religion?

                    Some people, including myself, are very skeptical about man’s ability to reason. And James Madison and John Adams certainly didn’t buy into Thomas Jefferson’s naive empiricism. Here, for instance, is what Adams had to say about man’s very limited ability to reason:

                    Our passions, ambitions, avarice, love and resentment, etc., possess so much metaphysical subtlety and so much overpowering eloquence that they insinuate themselves into the understanding and the conscience and convert both to their party.

                    This is the thinking which informed our constitutional and its separation of powers. As Adams continues:

                    Power must be opposed to power, force to force, strength to strength, interest to interest, as well as reason to reason, eloquence to eloquence, and passion to passion.

                    The idea is to try to keep any one group from gaining a monopoly of these things.

                  • Nick G says:

                    Is that what the Rev. Martin Luther King’s religion did?

                    Yes. Fortunately, he rose above that.

                    Note my language: I said religion “pushes” and “supports” certain things. That doesn’t mean that religious organizations can’t behave better than that. It just means that the underlying ideas promote certain things.

                    if by being rational what you mean is not departing from factual reality.

                    Factual reality is important. But what I’m referring to is a process: the process of thinking for one’s self, rather than relying on authority.

                    But why single out religion?

                    I’m talking about any organized movement that promotes reliance on authority for one’s ideas, and belief in the supernatural. I don’t like psychics, either.

                    Some people, including myself, are very skeptical about man’s ability to reason.

                    Sure. I agree. But…what’s the alternative? Relying on the reasoning of someone else, who tells us that they got their authority from a vision??

                    Now, I’d agree that religious organizations have much accrued cultural wisdom, including “mystical” wisdom that deserves more attention. But, we can’t accept it uncritically.

        • Nick G says:

          I have been following the debate between Sam Harris and Scott Atran …You can watch it here:

          I hate watching videos. Have you come across any transcripts for these?

      • nate says:

        Amazing please do tell more. I had no idea that islamic fundamentalism was a product of the 20th century. What true enlightenment you represent.

      • nate says:

        @Glenn

        Amazing please do tell more. I had no idea that islamic fundamentalism was a product of the 20th century. What true enlightenment you represent.

    • Jeffrey J. Brown says:

      It’s instructive to see what’s going on in Turkey, an overwhelmingly Muslim country, and an ally of the US, and a member of NATO.   A Reuters reporter noted that following a request for a minute of silence in honor of the Paris victims at the Turkey/Greece soccer game in Istanbul, the audience responded with boos, and chants of “Allah Akbar,” echoing the chants from the Islamic terrorists in Paris, as they shot hundreds of people.

      Incidentally, the largest charter school operation in Texas is the Harmony Public School system, which is run by followers of a secretive Turkish Islamic cleric, Fethullah Gulen*.  Harmony is just one of several Gulen school systems in the US and around the world. 

      The Gulen schools have brought in thousands of Islamic trained teachers from Turkey to teach in US schools, on H1-B Visas.

      What could possibly go wrong?

      *After years of denying any connection between Gulen and the Gulen schools, Gulen himself “came out of the closet” in a recent New York Times column and admitted that his followers have set up schools all over the world.  Gulen is fighting an arrest warrant issued for him in Turkey, and he is apparently trying to convince Americans that he is a good guy who runs great schools, presumably in an attempt to fight a possible extradition request from Turkey.   Apparently, Gulen has had a falling out with the Turkish president, after previously being closely allied with him.  In prior years, there were reports that anyone in Turkey who criticized Gulen ran the risk of being arrested on trumped up charges.  

      • Jeffrey J. Brown says:

        WikiLeaks files detail U.S. unease over Turks and charter schools (April, 2011)
        http://articles.philly.com/2011-04-04/news/29380536_1_charter-schools-fethullah-gulen-truebright-science-academy

        Classified documents recently released by WikiLeaks recount U.S. officials’ growing concern over large numbers of Turkish men seeking visas to work at American charter schools founded by followers of Fethullah Gulen, a powerful Turkish Muslim political figure who lives in the Poconos.

      • Glenn Stehle says:

        In Male Homosexuality: A Contemporary Psychoanalytic Perspective, Richard C. Friedman notes that,

        Stigmatization and scapegoating involve labeling some individuals as members of an outcast group; they therefore thrive on discreet categories, not on continua.

        More concretely, Amitai Etzioni in The Moral Dimension speaks of the tactics that political and economic entrepreneurs use in their “Us” vs. “Them” group-making, placing “Us” and “Them” in their neat little boxes, as well as what motivates this behavior:

        Nisbett and Ross…see the cause of prejudice in various cognitive biases. For example, those in groups against which prejudice is held, those whose members who fit stereotypes are given disproportionately higher weight than others, and “vivid” incidents are used to “validate” the stereotypes. Thus, according to this line of analysis, those who see a few lazy blacks, or loud Italians, and assume that all are, are simply over-generalizing. One may wonder, why do they not over-generalize positive attributes? Why do they so often focus their hostility on vulnerable groups? Emotional mechanisms seem at work. For example, people seem to split their ambivalence about others in such a way that negative feelings are projected on the out-group and positive ones on the We group.

        Alan Gilchrist, professor of psychology at Rutgers University, called out Sam Harris and Richard Dawkins on their one-eyed view of the world at the “Beyond Belief” conference in 2006:

        There was a scientific study done by a team at Hopkins University, using scientific polling techniques to estimate how many innocent civilians had been killed in the Iraq War. And the estimate they came up with is about 600,000.

        I was disturbed, especially yesterday and somewhat today — I mean I love people like Richard Dawkins and Sam Harris, they’re heroes of mine — by the ease with which people in this group here fell into that same language about Islam, and how much worse it is than Christianity….

        But what’s happening on the ground in the Middle East is basically one of Christians killing Muslims. And I think it’s very convenient to talk about what a violent religion Islam is, but what’s happening on the ground in the Middle East?

        https://www.youtube.com/watch?v=BRKbBsl6KaQ

          • Glenn Stehle says:

            This fellow Douglas Murray is a new one on me, that is until you and Sam Harris brought him up.

            But I must confess that those news outlets which Murray is a darling of (e.g., Fox News, The Spectator, The American Spectaror) are not the places I ususally go to for news and political commentary.

            “29 August: Douglas Murray on Fox News discussing the US’ lack of strategy”
            https://www.youtube.com/watch?v=KV-ra7XRfGI

            “Douglas Murray – Tracking Terror [Fox News]”
            https://www.youtube.com/watch?v=3S-d2gU62PM

            “Douglas Murray – Intelligence Agencies and Terror [Fox News]”
            https://www.youtube.com/watch?v=0yD9l68TXCE

            “10 January: Douglas Murray on Fox discussing the war with Radical Islam”
            https://www.youtube.com/watch?v=EBA_aysA63U

            Donald Trump, not to be outdone by Murray in the war on Islam, or in the macho-male chest pounding contest, fired back yesterday: “I will quickly and decisively bomb the hell out of ISIS. We’ll rebuild our military and make it so strong no one, and I mean no one, will mess with us.”
            http://www.cbsnews.com/videos/republicans-to-president-obama-no-syrian-refugees-here/

            To which President Obama responded: “These are the same folks oftentimes who suggest that they’re so tough that just talking to Putin or staring down ISIS or using some additional rhetoric is somehow going to solve the problems out there, but apparently they’re scared of widows and orphans coming into the United States of America as part of our tradition of compassion.”

            “They’ve been playing on fear in order to try to score political points, or to advance their campaigns,” Obama added, “and it’s irresponsible. And it’s contrary to what we are. And it needs to stop, because the world is watching.”
            http://www.cbsnews.com/videos/kerry-confident-isis-will-ultimately-be-destroyed/

            But Sam Harris and Douglas Murray have many more fellow travelers than just Donald Trump. As the Southern Poverty Law Center reported,

            The spread of Islamophobia into the conservative mainstream, as evidenced by the rhetoric of Republican candidates, extends well beyond Trump and Carson. As Mondoweiss recently explored, most of the GOP’s candidates have indulged in Muslim bashing of some kind or another in recent months:

            •Mike Huckabee, the former Arkansas governor turned TV show host, has called Muslims departing mosques “uncorked animals,” and said that Islam is “a religion that promotes the most murderous mayhem on the planet.”

            •Louisiana Gov. Bobby Jindal has refused to back down from his groundless claim that certain areas of Europe are “no go zones” dominated by Muslims using Sharia law.

            •Ex-Florida Gov. Jeb Bush hired as his political adviser Jordan Sekulow, who has a long background of anti-Muslim activism, and is noted for calling supporters of the so-called Ground Zero mosque “terrorists.”

            •Texas Sen. Ted Cruz hired as his Tennessee campaign chair a man noted for his history of anti-Muslim activism, Kevin Kookogey.

            •Rick Santorum has himself a long history of anti-Muslim comments, including a speech at the 2014 Values Voters Summit in which he claimed that “the West” was in an existential fight with the forces of “radical Islam,” noting that “you don’t have Baptist ministers going on jihad.” Santorum has also endorsed profiling Muslims in security and law enforcement work.

        • Jeffrey J. Brown says:

          Regarding Bush 43’s invasion of Iraq, it was Ralph Nader and his Green Party supporters in Florida who provided the swing votes against Gore in the year 2000 and delivered the US and the world into the arms of the Neocons. A combination of some of my comments on the prior thread:

          It’s interesting how one man can change world events, e.g., Gavrilo Princip, who assassinated Archduke Ferdinand, triggering the First World War, and indirectly the Second World War.

          If it weren’t for Ralph Nader, in my opinion it’s a virtual certainty that Gore would have won Florida in 2000*, and thus the presidency. And I can’t imagine that Al Gore would have launched an invasion of Iraq.

          My point is that just as Princip’s assassination of Archduke Ferdinand directly triggered the First World War and indirectly led to the Second World war, Nader’s political assassination of Al Gore in the year 2000 allowed a person, Bush 43, to be elected president–when a majority of voters in Florida and nationwide voted against Bush.

          And 9/11 gave Bush/Cheney/Rumsfeld and the Neocon crowd the excuse for invading Iraq–which arguably may have led to what may be decades of unrest, instability, terrorism and war, plus hundreds of thousands to perhaps millions of casualties.

          In any case, what’s bizarre about the 2000 election is that Nader ran as a third party (Green Party) candidate and therefore contributed directly to defeating a person, Al Gore, who was in my opinion the most pro-environment major party candidate that we have ever seen or perhaps that we will ever see.

          And in regard to current US politics, I’m beginning to wonder if the terrorist attack in Paris–and Obama’s tone-deaf response to concerns about Middle Eastern/North African refugees/migrants–may have made it possible that we may, God help us, see Donald Trump become the 45th President of the United States. Obama’s response has been characterized as arrogant, dismissive or petulant, even by some of his allies.

          *About 100,000 people in Florida voted for Nader and Bush won Florida by about 500 votes

          • ezrydermike says:

            of course if Gore could have won his home state……

            • Glenn Stehle says:

              Well there’s no better defense than to blame the victim.

              “Well, she didn’t fight me off.”

        • Glenn,

          Two hundred years ago in the South where I have lived all my life, there was “us” white folks and a lot of slave owners. Then there was “them”, black folks who were all slaves. My point is Glenn, that sometimes it is completely legitimate to divide folks into “us” and “them”.

          I lived in Saudi Arabia for five years back in the early 80s. There was “us” non Muslims and there was “them”, the Muslims. Then there were “them” women whom we never saw. Well there hands were exposed and sometimes their eyes. But other times their eyes were covered also with a veil. These women were not allowed out except when accompanied by a family member.

          There were exceptions to this law, or religious rule. Beggar women were allowed out alone… to beg. These women were widows who’s husbands had died and left them penniless. So if they had no other family member to support them they either died or begged. They never had any life insurance on their husbands because that was against the law in Saudi. It was considered placing a wager against the will of Allah.

          The women were not allowed to drive, not allowed to work and had no life whatsoever outside their home. It is the same in many other Islamic countries, to varying degrees. But in all Islamic countries women are second class citizens. That is simply a tenant of the Islamic religion even though most Islamist would deny it. And that is what assholes like Alan Gilchrist say we are not allowed to criticize. Well my sentiments are entirely with Sam Harris, Richard Dawkins and Bill Maher when they criticize the such stupid practices in the name of religion.

          Edit: During my five years in Saudi Arabia I made several flights between the US and Saudi. On many of these trips, especially those between Houston and Dhahran, there would be several Saudi women on board, accompanied by their husbands of course. The women would be decked out is high heels or cowboy boots, jeans and colorful blouses. But about half an hour out f Dhahran they would make their way to the bathroom… and in a few minutes exit… a black lump.

          Had they dared to exit the aircraft in their Texas attire, they would have been carted off to jail as soon as the customs agent saw their Saudi passport. In Saudi Arabia women don’t have rights.

          • Caelan MacIntyre says:

            “In Saudi Arabia women don’t have rights.” ~ Ron Patterson

            Isn’t that precious…

            List of authoritarian regimes supported by the United States

            1945–present Saudi Arabia House of Saud…

            [For Fernando just for the hell of it:]
            1952–1959 Cuba Fulgencio Batista…”

            [Second right-margin photo caption:]
            ‘Current president Barack Obama and First Lady with Gurbanguly Berdimuhamedow of Turkmenistan, September 2009, one of the most repressive regimes in the world, supported with millions of dollars in military aid‘ ” [Isn’t that precious.]. ~ Wikipedia

            BTW:

            “ten·et
            ˈtenət/…
            noun: tenet; plural noun: tenets

            a principle or belief, especially one of the main principles of a religion or philosophy.” ~ Google dictionary

          • Glenn Stehle says:

            So Ron, we’re to believe that the New Atheists, who Victoria Bekiempis blasted as being a “showboating boys’ club,” are now all of a sudden concerned about women?
            http://www.theguardian.com/commentisfree/cifamerica/2011/sep/26/new-atheism-boys-club

            After pointing to a number of promient female atheists – Madalyn Murray O’Hair (founder of American Atheist), Sergeant Kathleen Johnson (founder of an organisation for atheists in the United States military), Debbie Goddard (founder of African Americans for Humanism), and writers Jennifer Michael Hecht and Susan Jacoby – Bekiempis asks: “If all these smart, clearly respected women are in the mix of loud-and-proud atheists, why does the face of New Atheism still look like that of a curmudgeonly, sixtysomething white guy?”

            Annie Laurie Gaylor, who founded the Freedom From Religion Foundation with her mother, Anne Nicol Gaylor, in 1978, sums up the problem with our little “band of intellectual brothers” bluntly: “One word – sexism.”

            Bekiempis acknowledges that Harris hasn’t made the overtly misogynist statements like other members of the all male club have, such as Christopher Hitchens and Stephen Fry. Nevertheless, Harris doesn’t seem to have any qualms about keeping women hidden safely away at the back of the bus.

            So I’m wondering, given the New Atheists’ history of keeping women quarantined and marginalized, why the epiphany?

            • Glenn, there is no group that calls themselves the “New Atheists”. That is just a made up term by atheist haters. And there is no “New Atheists” movement. These guys, Dawkins, Harris and others, are just individual atheists who now choose to speak out about the hypocrisy of a lot of Bible thumpers.

              Quoting what individual atheists have said or did in the past is also a stupid rhetorical trick. I could give you instances of what religious people have done in the past, rape, murder and so on, and say this is an example of “The New Religious Order” or some shit like that. But I would not do that because that would be just as stupid as what you are doing.

              Harris doesn’t seem to have any qualms about keeping women hidden safely away at the back of the bus.

              That is absolute fucking bullshit! Harris speaks out for women’s rights at every opportunity. If all you can do is make up lies then it would be better if you just keep silent.

              • Glenn Stehle says:

                Well Joan Roughgarden (born Jonathan Roughgarden), an evolutionary biologist who teaches at Stamford University, certainly didn’t have any problem calling Dawins and Harris out.

                Being an academic and not a political activist, she wasn’t quite as blunt as Gaylor and Bekiempis, but she nevertheless managed to get her point across at the 2006 “Beyond Belief” conference. On a panel she served on with Richard Dawkins, she charged that:

                And you see the idiocy and the ludicrousness which is associated with this ever enlarging body of narrative and not data about sex roles. And so in our time I invite you to look at that body of literature, and see it as fundamentally flawed, not fixable, and reflecting the bias of a sexual selection theory which is locker room bravado, projected onto animals, and then retrieved from animals as if a fact of nature. So I invite you to see the extent to which there is bias and prejudice within science and that we as scientists as well as citizens have a lot to gain by fostering a dialogue…

                http://thesciencenetwork.org/programs/beyond-belief-science-religion-reason-and-survival/session-3-3

                • Nick G says:

                  It’s hard to tell what that quote is referring to, without a transcript.

                  It’s not clear that it’s about sexism on the part of athiests.

                  • Glenn Stehle says:

                    Nick,

                    The link is there to the video of the panel discussion.

                    If you can’t be bothered to go listen to the panel discussion between Dawkins and Roughgarden, what else can I say?

                  • Nick G says:

                    You can say that we all have better things to do with our time than listen to videos.

                    If it’s not worth transcribing…

                  • Glenn Stehle says:

                    Nick,

                    Even if what you say is true, then is it not incumbent upon the New Atheists to make an effort to be more inclusive, so as to counter the media perception?

                    But they have not done this, have they?

                    For instance, can you point to one leading woman New Atheist?

                    Can you point to one leading black New Atheist?

                    Can you point to one leading hispanic New Atheist?

                    The reality, of course, is that the New Atheists have not gone out of their way to be inclusive. And in fact, they have done just the opposite, as Bekiempis documents in her article. (I tried to include her specific citation, the paragraph which begins with “Nevertheless” and ends with “but the ‘New Atheists’ referred to in his book’s promotional materials include none of these women.”)

                    All of this exclusionary behavior by the New Atheists, of course, comes in defiance of the factual reality: decades of literary works published by strident, out and proud women atheists.

                  • Glenn, once again, atheists are not new atheist, they are just atheist. There is no organization called “The New Atheist”. One cannot be included in an organization that does not exist.

                    Can you point to one leading black New Atheist?

                    One that you might call a new atheist is Neil deGrasse Tyson. But he is definitely not a new atheist, he has been an atheist all his adult life.

                    But Neil deGrasse Tyson is not a member of any group that calls themselves “New Atheist” and neither is Bill Maher, Richard Dawkins or Sam Harris. They cannot be because such an organization does not exist. They all have been atheist all their life, or at least since they figured out that religion is nothing but stupid superstition.

                    And such people number in the hundreds of millions. To label them all as “New Atheist” is just ignorance coming from those that hope to prop up their superstition by slandering scientific and rational people.

              • Glenn Stehle says:

                Ron Patterson says:

                Glenn, there is no group that calls themselves the “New Atheists”. That is just a made up term by atheist haters.

                So these women atheists who are raising these issues about the exclusion and mysogeny of the New Atheists — a term they use — are all self-hating atheists?

                • Fred Magyar says:

                  So these women atheists who are raising these issues about the exclusion and mysogeny of the New Atheists — a term they use — are all self-hating atheists?

                  For the record, Joan Roughgarden is a proponent of Theistic Evolution. Which hardly qualifies her as an Atheist… Furthermore I highly doubt Dawkins could be characterized as a mysogenist.

                  I would venture that both Dawkins and Harris have more of an issue with Roughgarden’s views on God having a hand in evolution than with the fact that she is a woman.

                  As for mysogeny in academia, that is very much a separate issue from Atheism!

                  • Glenn Stehle says:

                    Fred,

                    So what about Gaylor and Bikiempis? Are they not atheists?

                    Are their charges of sexism not specific enough?

                    Let me assure you, they’ve spent many decades fighting in the trenches, and they very well know how to take names and kick ass. What kind of “ludicrous,” “idiotic,” and “data-free” narrative, to paraphrase Roughgarden, do you imagine the New Atheists can cook up to disqualify them?

                    The bottom line is that the little piece of ground the New Atheists stand on is slowly eroding away. Many people, including many atheists and many scientists, just don’t buy into their “secular stealth religion,” as David Sloan Wilson called it, or their “Darwinian fundamentalism,” as Stephen Jay Gould called it. And that’s even before we get around to talking about their sexism, militarism, Islamophobia, and anti-religious bigotry.

                  • Nick G says:

                    Are their charges of sexism not specific enough?

                    No, they’re not. Again, read the article more closely, and you’ll see that Bekiempis and Gaylor said that it was the media that was engaging in sexism.

                    As to the larger question: yes, religion based on a personal god tends to foster a dependence on authority, which can be associated with authoritarianism in all of it’s aggressive, rigid forms.

                    And, people who are raised in an authoritarian culture will tend to be authoritarian, regardless of the intellectual ideas they hold as adults. So, some atheists will be rigid and aggressive, even if their ideas ideally would point them in a different direction.

                  • Glenn Stehle says:

                    Nick,

                    Even if what you say is true, then is it not incumbent upon the New Atheists to make an effort to be more inclusive in order to counter the media perception?

                    But they have not done this, have they?

                    For instance, can you point to one leading woman New Atheist?

                    Can you point to one leading black New Atheist?

                    Can you point to one leading hispanic New Atheist?

                    The reality, of course, is that the New Atheists have not gone out of their way to be inclusive. And in fact, they have done just the opposite. As Bekiempis explains in her article:

                    Nevertheless, a statement on Stenger’s website identifies Harris’s book as the bellwether of contemporary atheist thought. On a page promoting his own book, The New Atheism: Taking a Stand for Science and Reason, Stenger writes that The End of Faith “marked the first of a series of bestsellers that took a harder line against religion than has been the custom among secularists.” In an email interview, Stenger acknowledged that female atheists do exist – name-checking Ayaan Hirsi Ali, Wendy Kaminer, Rebecca Goldstein and Michelle Goldberg, as well as Jacoby – but the “New Athiests” referred to in his book’s promotional materials include none of these women.

                    This outrageously false statement of Stenger’s comes in defiance of the factual reality: decades of literary works published by strident, out and proud women atheists.

                  • Glenn Stehle says:

                    Nick,

                    The complaint, and the sad reality, is that the New Atheists have made no effort to be inclusive. And in fact, they have done just the opposite. As Bekiempis explains in her article:

                    Nevertheless, a statement on Stenger’s website identifies Harris’s book as the bellwether of contemporary atheist thought. On a page promoting his own book, The New Atheism: Taking a Stand for Science and Reason, Stenger writes that The End of Faith “marked the first of a series of bestsellers that took a harder line against religion than has been the custom among secularists.” In an email interview, Stenger acknowledged that female atheists do exist – name-checking Ayaan Hirsi Ali, Wendy Kaminer, Rebecca Goldstein and Michelle Goldberg, as well as Jacoby – but the “New Athiests” referred to in his book’s promotional materials include none of these women.

                    This outrageously false statement of Stenger’s comes in defiance of the factual reality: decades of literary works published by strident, out and proud women atheists.

                  • Fred Magyar says:

                    Glen, as Ron mentioned, there is NO organization know as the ‘New Atheists’.
                    Are there individuals in academia who are also atheists and perhaps happened to be mysogenistic old white men? I’m sure there are but one has nothing to do with the other.

                  • Glenn Stehle says:

                    Fred,

                    So atheists like Bekiempis, Stenger, Gaylor, and Monica Shores just made up the entire New Atheism thing from whole cloth?

                  • Nick G says:

                    Again, Bekiempis and Gaylor were talking about the Media making it up.

                    I’d guess Stenger went along for the ride – remember, his promotional materials talked about “best sellers”, not the atheism “community” as a whole.

            • Nick G says:

              given the New Atheists’ history of keeping women quarantined and marginalized

              That’s not what Bekiempis or Gaylor said.

              They said that it was the Media that was quarantining and marginalizing female atheist writers.

            • Don Wharton says:

              More lying BS from Glenn. My friend Melody Hensley organized a number of Women In Secularism Conferences. This was with solid support from the Center for Inquiry, which is one of the largest national secular organizations. The videos from them are almost all available on the web and are highly recommended.

            • given the New Atheists’ history of keeping women quarantined and marginalized.

              That is about the stupidest thing I have read in a long time. Glenn you don’t have a fucking clue as to what the hell you are talking about. There is no group that calls themselves the “New Atheist”. Atheist sometimes do organize, like “The Freedom From Religion Foundation”. But none of those atheist are new and the organization is decades old.

              And claiming that any of them keep women marginalize is just plain ignorant. I am shocked that anyone on this list would be so damn dumb as to make such a claim.

    • Caelan MacIntyre says:

      “Karen Kwiatkowski concludes: ‘If you draw a map that connects the dots between all of the bases that we have done since the Cold War ended, what you see is American military hegemony – covering 90 per cent of global energy resources.’ ” ~ Wikipedia

      “N[oam]C[homsky]: There’s an interesting interview that just appeared a couple of days ago with Graham Fuller, a former CIA officer, one of the leading intelligence and mainstream analysts of the Middle East. The title is ‘The United States Created ISIS’. This is one of the conspiracy theories, the thousands of them that go around the Middle East.

      But this is another source: this is right at the heart of the US establishment. He hastens to point out that he doesn’t mean the US decided to put ISIS into existence and then funded it. His point is — and I think it’s accurate — that the US created the background out of which ISIS grew and developed.” ~ Noam Chomsky, interviewed by David Barsamian

      “A revealing light on how we got here has now been shone by a recently declassified secret US intelligence report, written in August 2012, which uncannily predicts – and effectively welcomes – the prospect of a ‘Salafist principality’ in eastern Syria and an al-Qaida-controlled Islamic state in Syria and Iraq. In stark contrast to western claims at the time, the Defense Intelligence Agency document identifies al-Qaida in Iraq (which became Isis) and fellow Salafists as the ‘major forces driving the insurgency in Syria’ – and states that ‘western countries, the Gulf states and Turkey’ were supporting the opposition’s efforts to take control of eastern Syria.

      Raising the ‘possibility of establishing a declared or undeclared Salafist principality’, the Pentagon report goes on, ‘this is exactly what the supporting powers to the opposition want, in order to isolate the Syrian regime, which is considered the strategic depth of the Shia expansion (Iraq and Iran)’.

      Which is pretty well exactly what happened two years later… A year into the Syrian rebellion, the US and its allies weren’t only supporting and arming an opposition they knew to be dominated by extreme sectarian groups; they were prepared to countenance the creation of some sort of ‘Islamic state’ – despite the ‘grave danger’ to Iraq’s unity – as a Sunni buffer to weaken Syria…

      What’s clear is that Isis and its monstrosities won’t be defeated by the same powers that brought it to Iraq and Syria in the first place, or whose open and covert war-making has fostered it in the years since. Endless western military interventions in the Middle East have brought only destruction and division. It’s the people of the region who can cure this disease – not those who incubated the virus.” ~ Seumas Milne, ‘Now the truth emerges: how the US fueled the rise of Isis in Syria and Iraq’

      Syrian Conflict a Battle in Fourth Generation Warfare Unleashed by West

      “The Syrian conflict is just a battle in a much broader third World War unleashed by Washington and its allies through the use of fourth generation warfare, proxies, mercenaries, economics, and information, Tony Cartalucci pointed out.

      The US influential think tank Brookings Institution has confirmed that Washington and its Middle Eastern allies are behind the ongoing turmoil in Syria and Iraq, backing both ‘moderate’ rebels and extremists in order to change the balance of power in the region, Tony Cartalucci, a Bangkok-based geopolitical researcher, noted.”

      What goes around, comes around.

    • Jeffrey J. Brown says:

      If Y is the total number of Muslims and if X is the number of violent Islamic extremists, it stands to reason that as Y (total number) increases so does X (violent extremists). Of course, X (violent extremists) would be the sum of recent (extremist) immigrants plus home grown violent Islamic extremists, i.e, the children of previous immigrants, which is what apparently happened recently in France.

      So, it would stand to reason that if one wants to increase X (total number of violent extremists), we should allow greater immigration from predominantly Muslim countries.

      • Nick G says:

        Probably the more important thing to focus on is finding productive employment for all those young males.

        France would do well to make the children of immigrants automatic citizens, and promote assimilation, rather than keeping them unemployed in ghettos.

        And, countries like Saudi Arabia would do well to expand their economy beyond oil, and find things to do for their young people. It might help if the US stopped supporting a rigid monarchy, which resists opening up the economy and government to new things.

        Of course, the US is terrified of any change at all in countries like KSA, because that might endanger oil supplies. But, the longer change is delayed, the more violent it will be when it comes. After all, look how violent the change was in Iran in 1979, after 25 years of US imposed authoritarian rule.

        The US may have to kick the oil habit before it can dump it’s counter-productive foreign policies.

  2. brainpimp says:

    For peak oil we sure do seem to have a lot of it. /SMH

    • Really? Texas produces about 4% of the world’s crude oil production. And you can tell from looking at that 4% that we sure do seem to have a lot of oil?

      • Longtimber says:

        I recall hearing that Texas was a Net Energy Importer. Jeff, Is that still the case. Florida imports 99.9+ % of it’s Energy.

        • Jeffrey J. Brown says:

          With the production increase, Texas is almost certainly a net energy exporter now.

  3. Greenbub says:

    http://www.marketwatch.com/story/minister-says-russia-oil-output-increasing-report-2015-11-16

    “Russia’s oil output is increasing and will reach 533 million metric tons this year, Energy Minister Alexander Novak said Monday, Interfax news agency reported.

    Russia’s oil production has already exceeded levels of the Soviet Union and now the world’s second-largest oil producer pumps an average of 10.74 million barrels a day, according to government data.

    Earlier this year, Mr. Novak said that Russia’s oil production in 2016 will be close to this year’s levels.”

    • I still believe 2015 will be the peak for Russia. Their web site, CDU TEK showed a huge drop the last few days. They are at 1446.9 thousand tons per day. They were around 1470 just a few days ago. I expect to see Russian production lower in November and December.

      • AlexS says:

        Ron, do you really think that daily, weekly of monthly fluctuations in production volumes are a sign of a permanent peak? They can be a result of maintenance, weather conditions or other temporary factors.
        There were days in recent months when production dropped below 1440 thousand tons per day. And there were sharp monthly declines. For example, production in July 2014 dropped to 1418 th. tons from 1440 th tons in previous month (by 158 kb/d).

        • Oh for God’s sake Alex, give me a little fucking credit. I have been following Russian oil production for 10 years and I know a bit about what might indicate whether a country is peaking or not.

          The below chart is from the EIA’s Short Term Energy Outlook, Russia Total Liquids. The EIA has Russia peaking in 2015. That is my estimate also. But that is based on one hell of a lot more than just the below chart.

           photo Russia STEO_zps3r6vmy3n.jpg

          • AlexS says:

            Ron,

            I have been following Russian oil industry for 35 years.
            I am regularly reading local sources, including company reports, etc.
            The EIA is certainly not the most reliable source of information on Russian oil.
            They have been revising up their forecast for 2015-16, but with significant delays. It’s amazing that they have Russian production peaking in June 15, followed by a six-month decline.
            In fact, production declined in July, but has been recovering in August-October, having reached a new post-Soviet record.
            The IEA has also been pessimistic on Russian oil production since end-2014, but they finally recognized that output remains surprisingly resilient and now project it to “remain robust in 2016 as well” (IEA OMR November 2015).
            Their updated C+C+NGL production forecast for 2016 is 11.05 mb/d, up from 10.93 mb/d in October OMR and 10.86 mb/d in July OMR.
            The IEA is more closely following monthly oil production numbers, as it works with local agencies, and is revising estimates with only one-month delay.

            Russian total liquids (C+C+NGLs) production estimates and forecasts from different issues of EIA STEO

            • Alex, do you have production data for the Nenetsky AO? I did a study in the area, to prepare the development due east of Naryan Mar.

            • AlexS says:

              Fernando,

              When have you been there? Did you work with Total?

              Oil production in the NAO was rapidly rising until 2009; then it was equally rapidly dropping due to unexpectedly high declines at Lukoil’s South Khylchuyuskoe oil field. Production stabilized and started to rise again last year due to the start-up of the Trebs and Titov field and several smaller fields. Growth is continuing this year and is projected for for 2016 due to ramp-up of Trebs and Titov and several new field start-ups by Lukoil and Rosneft

              Oil production in the Nenets autonomous district (kb/d)
              Sources: Arhangelskstat; NAO government forecast

              • Nice. So YK didn’t have a continuous reservoir? I always thought it was the field that a super alien deity created (I’m agnostic).

                Are they moving the oil by tanker from the Pechora terminal?

                Oh, and no, I didn’t work for Total.

        • Javier says:

          AlexS,

          The fall in oil production is not a sign, indication, or confirmation of peak oil. It is the fulfillment of a prediction based on the end of cheap to produce oil.

          One can just look at the graph and think that there is nothing new in this fall and that prices will eventually recover and production will surpass this peak, or one can study the causes of the fall, the effect that it will have on production and the economy, and understand that this time it is for real.

          The predictions that are going to fail are those that claim that this is a temporary situation and that a recovery of prices and production will take place in a few months or 1-2 years, because they are baseless.

          • AlexS says:

            Javier,

            Ron’s chart uses EIA’s estimated that are wrong and outdated.
            In fact Russian oil production reached a new record in October.
            Here is the chart with real numbers of crude + condensate production from the Russian Energy Ministry (unlike the EIA and the IEA, it does not include NGLs, but NGLs production is also rising due to increasing share of wet gas in total natural gas output):

            • Javier says:

              Ok, you convinced me regarding Russia.

              They are the main ones gaining market share through 2015, then.

              • AlexS says:

                Javier,

                The main winner in terms of market share this year is Saudi Arabia. In 2014 and the previous 2 years, it was U.S.

                Crude and condensate production in Russia, Saudi Arabia and U.S. (mb/d)
                Sources: Russian Energy Ministry, JODI, OPEC, EIA

                • Ves says:

                  Alex,
                  I think there are no winners if we just look from the oil industry perspective. All oil producers at this moment are losers with just with different degree of loss.

                  • AlexS says:

                    Ves, I totally agree with you. There are no winners, as all oil producers are suffering from low oil prices.
                    But Javier mentioned one particular aspect – the market share

                  • Dennis Coyne says:

                    Hi AlexS,

                    I typically look at market share in the following way: Who has the biggest share?

                    In this rare instance, I agree with Javier, Russia is winning the market share battle for C+C output from Jan 2014 to Sept 2015, based on your chart.

            • I am not at all sure that the EIA data is wrong. It matches the JODI data pretty close. And both report Russian C+C production at from 400,000 to 500,000 bpd below what CDU TEK reports.

              I do not believe any country knows what their daily production was the day after it was produce. I think they just make a wild ass guess and that guess is just naturally very optimistic.

              I believe 2015 will be the peak year for Russian oil production. Time will tell.

              • AlexS says:

                Ron,

                Oil producers were reporting to the Oil ministry in Soviet times on a daily basis, and these rules were kept since then. The combined numbers for the last month are preliminary, and they are revised in the beginning of the next month, usually not by much.
                The monthly numbers, re-published by several Russian oil journals and by the Energy Intelligence are very detailed.
                They include not only all companies, but also regional units and subsidiaries of the large vertically-integrated companies.
                The numbers can easily be checked as oil is transported by large pipelines, not by trains and trucks. There are also check-points at the refineries and at the customs.

                As regards differencies between the Russian Energy Ministry’s, the IEA’s, the EIA’s and JODI’s data, we have already discussed them before (probably, in early October). They mainly reflect different classification of condensates. The EIA and JODI account large part of Russia’s condensate production as NGLs

                I had posted this table before. If you want, I can update it

                Russian liquids production estimates from different sources

              • AlexS says:

                Until January 2012, JODI’s statistics were more in line with Russia’s Energy Ministry. Since then, they are accounting a large part of Russian condensates as NGLs:

                Here are JODI’s numbers for Russia (as of 2 month ago):

          • AlexS says:

            The IEA Oil Market Report shows monthly estimates of C+C+NGL output by country, but does not disclose its monthly forecasts.
            The November OMR with data for October is not yet available for non-subscribers, but the numbers from previous issues show significant discrepancy with the EIA.

            Russian C+C+NGL production estimates for end-2014 – 2015 from IEA OMR and EIA STEO

      • AlexS says:

        Ron,
        Yesterday’s Russian C+C production was 1466.4 thousand tons, up 19.5% from previous day. I was right that a drop in the past few days was just temporary.
        http://www.riatec.ru/en/

        • AlexS says:

          On November 17, Russian C+C production increased to 1472.4 thousand tons (10,749 kb/d). This is above October monthly average of 1470.0 thousand tons (10,731 kb/d)
          (barrels/ton ratio = 7.3)
          These are normal fluctuations in daily output
          http://www.riatec.ru/en/

    • AlexS says:

      This is a post-Soviet record. In 1987, Russian Federation (part of the Soviet Union) produced 570 million tons, or about 11.4 mb/d of crude and condensate.

      For instance, the IEA in the November oil market report, increased its estimate of Russia’s C+C+NGL production in 2016 by 120 kb/d, to 11.05 mb/d from 10.93 mb/d in last month’s report.
      From IEA OMR: “…resilient non-OPEC supply – with Russian output at a post-Soviet record and likely to remain robust in 2016 as well. “

      • Dennis Coyne says:

        Hi AlexS,

        Do you (or the Russian Energy Mininistry and Russian oil analysts) have an estimate for future Russian oil output? Let’s assume that oil prices gradually rise starting in late 2016 from $75/b at an 6.2% annual rate of increase and reach $175/b in 2030.

        Would you expect Russian oil output to be on an undulating plateau from 2015 to 2030, or would you expect an increase in output (12 month average output)? If an increase in output, how much?

        • AlexS says:

          Dennis,

          The official forecast predicts a long-term plateau to 2035.
          I think this is the most plausible medium-term scenario if oil prices do not stay at $40-50 for several (more than 2) years. This is based on a number of conventional projects in Western and Eastern Siberia, the Northern Caspian, etc. , that are at advanced stage of development, and additional drilling at older fields.
          Note that Russian oil and gas capex is expected to increase by about 22% in nominal rouble terms this year. Obviously, in real (inflation-adjusted) terms, the increase will be slower. Thus, drilling activity was up 10% y-o-y during the first 8 months of 2015, with rapidly increasing share of the horizontal drilling.

          To maintain production at about 530 mtons after 2020, Russia will need to develop a new resource base, including the Arctic offshore and tight oil resources (not only Bazhenov, but also Achimov, Tyumen and other formations).

          As you understand, a plateau means that there could be years of slightly higher and slightly lower production.

          • Dennis Coyne says:

            Hi AlexS,

            Thanks. Your analysis of the Russian oil industry seems excellent to me, I appreciate your insight.

          • FreddyW says:

            Alex I would be carefull to trust what governments and companies say about future oil production. At least for Russia where oil is very important politically. Russia is also perhaps not the most open society. Don´t they have one of the largest drilling fleets in the world? And they still need to increase drilling by 10% y-o-y just to keep production flat. Seems more like production is about to collapse to me.

            • I think you have a pretty clear picture of the situation Freddy. Sometimes the blatantly obvious is just so damn hard for some people to grasp.

              • Dennis Coyne says:

                Hi Ron,

                My guess is that AlexS has better insight into the Russian oil industry than you or FreddyW.

                The Jodi data is terrible, the EIA hasn’t reported “officially” on Russian output since April and AlexS has given a sound explanation for the differences in Russian data vs other agencies.

                As to increasing drilling with flat production, production only collapses when the drilling stops. Does that seem a reasonable assumption to you?

                It is surely possible that output will decline before 2035, but collapse? Only if World War 3 starts in the meantime.

                At that point oil decline is a minor problem.

                • My guess is that AlexS has better insight into the Russian oil industry than you or FreddyW.

                  Hi Dennis,

                  My guess is you’re fulla shit. Fifteen months ago I published this post:

                  Global and Russian Energy Outlook to 2040. That post was based on this report by two Russian Think Tanks:
                  GLOBAL AND RUSSIAN ENERGY OUTLOOK TO 2040

                  That report clearly stated that Russian crude oil production would peak somewhere around 2015. And not just that, that report stated that the vast majority of Russia’s future oil production would come from reserve growth of Russia’s very old Western Siberian giants. That is where over 60% of Russia’s production is coming from today and where they say most of Russia future oil production will come from. That is where over 5,000 wells per year are being drilled in a desperate attempt to keep Russian production flat.

                  I think those two Russian think tanks have a better insight on the future of Russian oil production than Alex. That is even though their predictions are overly optimistic concerning Russia’s very old Western Siberian fields. Those tired old fields have already undergone all the reserve growth they are ever going to get.

                  Russian oil production is on the verge of collapse. Learn to live with it.

                  Edit: Dennis, sorry for my strong language but I am on my third toddy tonight and am just not in any kind of mood for mushy ambiguities. In times like this just want to say the first thing that comes to my mind. And that is exactly what I did.

                  • Synapsid says:

                    Ron et al.,

                    Article on Rigzone says the Erginskoye field in Western Siberia will be put up for sale early next year.

                    AlexS, Fernando:

                    Is that a big deal, or part of normal functioning?

                  • AlexS says:

                    Synapsid,

                    Erginskoye is one of the last (not the last, as the article says) relatively large fields remaining in the federal fund of undistributed oil fields. This fund includes fields discovered and explored by state geologic firms in the past 2-3 decades, but not yet sold (on the auction) to oil producers.
                    This is a normal practice for undeveloped fields discovered in the 1980s and 1990s and still remaining if federal ownership.
                    Now oil companies themselves are exploring for new oil and gas fields.

                    This particular field was discovered in 1995 and its estimated reserves (C1+C2 category under Russia methodology) are 103 million tons. This equals slightly less than 1/5 of Russia’s annual output.

                  • Dennis Coyne says:

                    Hi Ron,

                    Not a problem, as it is true that I am full of “what makes the grass grow green”, as my Grandmother was fond of saying (though she was referring to my Dad).

                    You know what they say, the apple tends to fall near the tree.

                    There are often conflicting studies, my guess is that AlexS has read most of them on Russia, you follow this closely, I have the impression he follows Russian oil even more closely than you. I doesn’t mean he is correct, but he sure seems highly competent to me.

                  • Dennis, I have no doubt that Alex follows Russian oil production very closely. The future of Russian oil production is not something that can be followed however. That can only be estimated based on an analysis of Russia’s current producing fields and their prospects for new fields not yet found.

                    There Alex differs from just about every other Russian prognosticator I have ever read. And I have read a lot of them. The Energy Research Institute f the Russian Academy of Science and The Analytical Center for the Government of the Russian Federation being among them.

                  • Dennis Coyne says:

                    Hi Ron,

                    I imagine AlexS could post links to numerous reports on expected future Russian output.

                    Of course future output is a guess and there are many different guesses. One can believe those reports that confirm their view and label reports with different conclusions as being false.

                    I tend to take reasonable future estimates that are different and just average them.

                    That is I take the middle road, thinking that reality may fall between pessimism and optimism, but it is only a guess.

                  • Synapsid says:

                    AlexS,

                    Thank you. That’s all new to me.

                • FreddyW says:

                  Dennis,

                  It of course depends on what we mean with collapse. But there is nothing that says that the decline rate in a region has to be low. If you spend more effort to keep up production in old fields rather than finding new oil, then the production curve will move to the left. Russia has a very high number of drilling rigs, but don´t seem to find that much new oil. Most of the drilling seems to be in old fields. There is no problem to have depletion rates of 10-20% or even more in individual fields (not saying that the regional decline rate will be that high). The regional production curve should follow the discovery curve quite well in that case. But if you don´t find that much oil, well…

                  Also having a production plateau for a longer period of time is quite abnormal. In a working market ekonomy production should go up and then down because the companies compete and try to produce it relatively fast. Saudi arabia has been able to keep a plateu because they have monopoly. They decieded to save some production for later by saving some fields and by keeping depletion rates relatively low and then increase them as time goes by. Russia has several state owned companies and also private ones. I dont´t get the impression that they are saving some oil for later. The increase in production has slowed down the latest years. It should indicate that it is about to go the other way.

                  • Dennis Coyne says:

                    Hi Freddy W,

                    At some point Russian oil output will decline, by collapse do you mean decline?
                    In the US (an older oil producing nation than Russia) the decline was about 2.5% from 1985 to 2006. If that is a collapse, perhaps the same will happen to Russia. Also plateau can sometimes mean a slow rise with a slow fall. In the chart below Russian output rises quickly from 1995 to 2005 and more slowly from 2005 to 2014, perhaps 2015 will be the peak as Ron believes, but the decline may be slow for 10 years following the peak, if oil prices rise they may drill enough to keep decline rates low. I doubt it will be any faster than 2.5% unless there is a Worldwide depression. Is that your expectation, a lack of oil demand?

                  • FreddyW says:

                    Dennis,

                    I don´t know what the decline rate will be, but 2,5% is way too low considering how much effort they seem to make in increasing depletion rates in old fields. I think the big question is, if they have such a huge resource base elsewhere, then why are they still not using it? If you have a good explanation to that, then I may be wrong about the high decline rate.

                  • Ves says:

                    “if they have such a huge resource base elsewhere, then why are they still not using it?”

                    FreddyW,
                    Because from their point of view it is not in their self-interest. Simply as that. But I do believe that decline rates and future production are always overestimated or underestimated depending what conclusion you want to present. Real numbers are somewhere in the middle but bottom line is we don’t know.

                  • Dennis Coyne says:

                    Hi Ves,

                    I agree we don’t know.

                    Hi FreddyW,

                    Don’t you think the United States was trying to produce s much oil as possible and doing as much infill drilling as was possible to do profitably in old fields?

                    Why do you expect the decline rate to be higher in Russia? Technically I have heard they are very competent, they are drilling in the areas that they think are most profitable, just as we do in the US. In the US we were roughly on a plateau from 1968 to 1985, the US also started producing oil earlier than Russia. I think the 2.5% decline rate is very reasonable and it may not get that high for a few more years, maybe between 2020 and 2025.

                    I think the official forecast of a plateau until 2035 is too optimistic and I think your estimate of steep decline (more than 3% maybe, you didn’t say) within a year or two is too pessimistic. The reality will be somewhere in the middle, but time will tell.

            • gwalke says:

              This is also true for the EIA, to be fair. Several of their regular reports – reported as gospel in the media – are garbage, the Drilling Productivity Report being the one I’m most familiar with.

          • Dennis Coyne says:

            Hi Alex,

            Ron cites a forecast by some Russian “think tanks” that predicted (I haven’t read the report) a 2015 peak. I think the link is in a comment below, is there a reason you prefer the official forecast?

            I don’t know about Russia, but the US EIA forecasts are almost always too optimistic (LTO is one exception that most people did not see coming 5 years ago), especially over the long term.

            Does a plateau until 2035 seem reasonable? Lets call a plateau 9000 to 11,000 kb/d, do you think it likely that Russia will still be producing 9000 kb/d or more in 2035?

  4. Longtimber says:

    OK.. NOW we know the truth bout well declines.. (?/sarc/?)
    “Oil thieves are a slippery bunch” “In Texas, oilfield theft has become entangled with Mexican drug trafficking, as the state’s newest and biggest production area, the Eagle Ford Shale region, lies along traditional smuggling routes.” Even more Lawyers, Guns & Crude.
    http://www.bloomberg.com/news/articles/2015-11-16/oil-theft-soars-as-downturn-casts-u-s-roughnecks-out-of-work

  5. Dennis Coyne says:

    Hi Ron,

    In your post you said,
    Dr. Dean Fantazzini has Texas C+C with a slight uptick in September but still well below the December 2014 peak.

    I believe the peak was in March 2015. Based on Dean’s estimate Sept 2015 C+C output is higher than Dec 2014 C+C output.

    Chart with blow up of Dean’s C+C estimate for Texas below.

    • Yes, you are correct, I was just looking at the last peak and assumed it was December. I have made the correction.

      Thanks

    • AlexS says:

      It is interesting that Dean’s chart confirms the view that the EIA may have overestimated the decline in Texas C+C output (mainly in the Eagle Ford, in my view)

  6. Doug Leighton says:

    MASSIVE NORTHEAST GREENLAND GLACIER IS RAPIDLY MELTING

    “Not long ago, we wondered about the effect on sea levels if Earth’s major glaciers were to start retreating,” Rignot noted. “We no longer need to wonder; for a couple of decades now, we’ve been able to directly observe the results of climate warming on polar glaciers. The changes are staggering and are now affecting the four corners of Greenland.”

    http://www.sciencedaily.com/releases/2015/11/151112150438.htm

    • Javier says:

      Too bad is a lie.

      Losing mass at a rate of 5 billion tons per year, glacier Zachariae Isstrom entered a phase of accelerated retreat in 2012.

      2012 was a minimum for Arctic ice. Since then Arctic ice and most Greenland glaciers, including Zachariae Isstrom, have been growing, not retreating. NASA’s own pictures clearly demonstrate it.

      2013 : EOSDIS Worldview
      2015 : EOSDIS Worldview

      Oct. 30, 2015
      NASA Study: Mass Gains of Antarctic Ice Sheet Greater than Losses

      A new NASA study says that an increase in Antarctic snow accumulation that began 10,000 years ago is currently adding enough ice to the continent to outweigh the increased losses from its thinning glaciers.

      The research challenges the conclusions of other studies, including the Intergovernmental Panel on Climate Change’s (IPCC) 2013 report, which says that Antarctica is overall losing land ice.

      http://www.nasa.gov/feature/goddard/nasa-study-mass-gains-of-antarctic-ice-sheet-greater-than-losses

      Oh well, we have been lied by IPCC. What else is new?

      The most interesting part from the study:

      “The good news is that Antarctica is not currently contributing to sea level rise, but is taking 0.23 millimeters per year away,” Zwally said. “But this is also bad news. If the 0.27 millimeters per year of sea level rise attributed to Antarctica in the IPCC report is not really coming from Antarctica, there must be some other contribution to sea level rise that is not accounted for.”

      OK, let’s get this right. We thought that Antarctica was contributing 0.27 millimeters per year to sea level rise, but in reality it is reducing sea level by 0.23 millimeters per year. So we were wrong by 0.5 millimiters per year out of 1.5 millimeters per year that we believe sea level is raising. And actually some people believe that this is somehow settled science?

      • Doug Leighton says:

        It is interesting you would label a report by the National Snow and Ice Data Center a lie. Many scientists participated in the referenced paper; are they all liars? Is the paper you cited about Antarctica written by honest scientists? You could be right but I can’t imagine you are popular in academic circles. I’ve been around research people for over 40 years and you are the first researcher I have encountered (you are a researcher?) to call confederates liars. It’s hard to understand how you can get away with this.

        Another lie, I suppose, but 1975 to 2015 time lapse photos show recent rapid retreat of the Zachariæ Isstrøm glacier’s front. The dark green line marks the 2003 extent of the glacial front. Note the rapid retreat through 2015 in lighter shades blending toward white. http://robertscribbler.com/2015/11/13/11038/

          • Doug Leighton says:

            Sigh, interesting but I think all this will soon be branded as a lie as well.

            • ezrydermike says:

              right on cue

            • AllanH says:

              So by converting snow mass to ice mass ( a 10X increase in density) Zwally was able to show an increase in mass for the Antarctic ice sheet. If one ignores the fudge factor used by Zwally et al, the ice sheet will be losing mass quite rapidly since the actual mass is much less than the recalculated mass.
              I am glad ezrydermike brought that to our attention.

        • Javier says:

          Leading people to believe that a glacier is going to melt rapidly and elevate sea level by 18 inches is lying to alarm people. It is not going to happen and they know that, or at least they should know that if they have keep up with the literature:

          T. Moon, et al., 21st-Century Evolution of Greenland Outlet Glacier Velocities. Science 336, 576-578 (2012).

          we produce a decade-long (2000 to 2010) record documenting the ongoing velocity evolution of nearly all (200+) of Greenland’s major outlet glaciers, revealing complex spatial and temporal patterns. Changes on fast-flow marine-terminating glaciers contrast with steady velocities on ice-shelf–terminating glaciers and slow speeds on land-terminating glaciers. Regionally, glaciers in the northwest accelerated steadily, with more variability in the southeast and relatively steady flow elsewhere. Intraregional variability shows a complex response to regional and local forcing. Observed acceleration indicates that sea level rise from Greenland may fall well below proposed upper bounds.

          http://www.sciencemag.org/content/336/6081/576.abstract

          This very same retreat was taking place in the 1930’s

          1930s photos show Greenland glaciers retreating faster than today
          But nobody thought it was a big deal

          http://www.theregister.co.uk/2012/06/02/1930s_greenland_glacier_retreat/

          Taken together the pictures show clearly that glaciers in the region were melting even faster in the 1930s than they are today, according to Professor Jason Box, who works at the Byrd Polar Research Center at Ohio State uni.

          A.A. Bjørk et al., An aerial view of 80 years of climate-related glacier fluctuations in southeast Greenland. Nature Geoscience 5, 427–432 (2012).

          Here we present a unique record that documents the frontal positions for 132 southeast Greenlandic glaciers from rediscovered historical aerial imagery beginning in the early 1930s. Furthermore, the recent retreat was matched in its vigour during a period of warming in the 1930s with comparable increases in air temperature. We show that many land-terminating glaciers underwent a more rapid retreat in the 1930s than in the 2000s, whereas marine-terminating glaciers retreated more rapidly during the recent warming.

          http://www.nature.com/ngeo/journal/v5/n6/full/ngeo1481.html

          L. Phillips. Rediscovered photos reveal Greenland’s glacier history. Nature doi:10.1038/nature.2012.10725

          Ice retreat was as drastic in the 1930s as it is today.
          Analysis of the images reveals that over the past decade, glacier retreat was as vigorous as in a similar period of warming in the 1930s.

          http://www.nature.com/news/rediscovered-photos-reveal-greenland-s-glacier-history-1.10725

          Take a look at picture number 6. That glacier was shorter 80 years ago.

          So, yes. In my opinion if you ignore relevant bibliography published 3 years before, to go way beyond what the data says to promote the idea that a glacier is going to rapidly melt and raise the sea level by 18 inches, then yes, they are lying to people by leading them to a false conclusion. Do you think that scientists are a type of human beings incapable of lying? because if that is the case then you have not been around scientists for long enough, because I have personally known a few that lied shamelessly in their publications to advance their careers, like people in any other profession.

      • Synapsid says:

        Javier,

        There is an analysis of the Zwally paper at RealClimate.

        This is how science works.

        • Thrig says:

          Someone may wish to inform the present chair of the House Committee on Science, Space, and Technology as to how science works.

          http://arstechnica.com/science/2015/11/congressman-continues-pressuring-noaa-for-scientists-e-mails/?comments=1

        • Javier says:

          I know how science works.

          Regretfully for that critic, Zwally’s groups results have been confirmed by a completely different technique, so his critic is actually incorrect.

          The joint expedition from American Geophysical Union and British Antarctic Survey have demonstrated that:

          Annual snow accumulation on West Antarctica’s coastal ice sheet increased dramatically during the 20th century

          The new study used ice cores to estimate annual snow accumulation from 1712 to 2010 along West Antarctica’s coast. Until 1899, annual snow accumulation remained steady.

          Annual snow accumulation increased in the early 20th century, rising 30 percent between 1900 and 2010, according to the new study. The study’s authors found that in the last 30 years of the study, the ice sheet gained nearly 5 meters (16 feet) more water than it did during the first 30 years of the studied time period.

          Since the record is 300 years long, we can see that the amount of snow that has been accumulating in this region since the 1990s is the highest we have seen in the last 300 years.

          http://news.agu.org/press-release/west-antarctic-coastal-snow-accumulation-rose-30-percent-during-20th-century-new-study-finds/

          http://onlinelibrary.wiley.com/doi/10.1002/2015GL065750/abstract

          Please note that this is the same West Antarctica that is supposed to collapse any time now.

          • Synapsid says:

            Javier,

            Have you read the article at Real Climate?

            • Javier says:

              Sure I did. Bamber criticises Zwally for being alone in defending Antarctic growth, not a scientifically valid point; he is right or wrong and numbers have nothing to do with that. He then criticises the method because although altimetry is very precise, estimation of snow densities is not and defends that changes in firning could invalidate the conclusions although he does not have any data that actually contradicts Zwally’s model. Then he criticises the measurement of altimetry from satellites and he is clearly wrong on that because with those techniques me measure the distance to the moon with a precision of a few millimetres. Then he goes to defend the satellite measurement of gravimetric anomalies as his preferred choice, a technique clearly prone to a lot more error than altimetry in the interpretation of the data and that has been used to measure mostly changes in liquid bodies, that experiment local changes much larger that what can be expected from snow deposition from year to year. That is seen the mote in the eye of one technique and not seen the beam in the other’s.

              I don’t know if you have read the info about Thomas et al., (article and press release from AGU) that I posted above. They invalidate Bamber’s criticism almost point by point. Since they measure in ice-cores they don’t need a model of precipitations, since they measure amount of water in the ice core, they have no problem with firn densities. Since they measure mass directly, they have no problem with satellite errors. It is in any way superior to both Zwally and Bamber’s and it supports Zwally.

              You can accept these two later studies (Zwally’s and Thomas’) as a correction of previous studies and Antarctica as an ice growing continent, or you can decide that you are still not convinced and that evidence is contradictory and therefore we don’t know if Antarctica is growing its ice or not. What you cannot do is support any alarmism on Antarctica’s ice dynamics, unless you are prepared to ignore science.

              • Dennis Coyne says:

                Hi Javier,

                There are often differences in opinion in science, you have a habit of presenting the minority view and concluding that must be the correct hypothesis. Alternative views are “alarmist and liars”. Do you really expect anyone will be convinced by your assertions? I certainly am not.

                • Javier says:

                  Hi Dennis,

                  I do not expect anybody to be convinced by my opinions and assertions, but I sure do expect that anybody not biased in theirs will look dispassionately to the evidence that I present and reach their own conclusions. The alarmism that we are bombarded everyday is unjustified by current scientific evidence and lots of scientists are saying so in their publications, but they don’t get the same level of exposure.

                  The truth is that alarmist climate predictions of the last decades have failed, everyone of them. After almost two decades of little to no warming climate models do not reflect reality. But we still have a lot of people whose livelihood depends on alarmism continuing. Scientists have to sell their research and alarmism sells, but we should be smart enough to distinguish between scientists predictions and scientific predictions. They are not the same. Scientists predictions are as worthless as anybody else’s.

                  • Doug Leighton says:

                    So, do you assume labeling scientists as liars somehow contributes to a discussion? News reports on scientific papers are always simplified (stripped of math, etc.) and tend to contain statements that emphasize more dramatic outcomes but one solution (if you disagree) is to refer readers to the sourced journal articles which are always properly nuanced. Assuming a holier-than-thou attitude, and calling people liars, is offensive as well as non-productive.

                  • Heinrich Leopold says:

                    Javier,

                    Thanks for your comments. It is good that we still live in a democracy and your comments and opinions, which I share wholeheartely, are allowed.

                  • Doug Leighton says:

                    Heinrich, apart from being unprofessional, damaging to a person’s reputation by labeling him a liar is not condoned in a democracy. It’s called slander and slander is a crime.

                  • Dennis Coyne says:

                    Hi Javier,

                    The scientist realizes that there is natural variability. I will leave it at that. The models are fine once one realizes that the models have two large a grid size to predict long term weather patterns and that there is a difference between weather and climate.

                  • Jeffrey J. Brown says:

                    It’s called slander and slander is a crime.

                    Doug,

                    I don’t know about other countries, but in the US, libel/slander is a civil claim, not a criminal offense. And libel primarily refers to written communications (and apparently recorded oral/video presentations), while slander primarily refers to oral (unrecorded) communications.

                    A link on libel/slander:

                    http://defamation.laws.com/defamation-laws/libel-vs-slander

                    Incidentally, it’s my understanding that you are free, in the US anyway, to express opinions about people, i.e, you can say that, in my opinion, “X” is a liar, but making a categorical statement that “X” is a liar is a different situation, possibly constituting libelous/slanderous defamation.

                  • Doug Leighton says:

                    Jeff,

                    Don’t know anything about US but in Canada Defamatory libel is equally valid as a criminal offence under the Criminal Code.

                    In any case, I can’t imagine calling a collogue a lair unless I had evidence and suspected his lie might cause damage to a third party(s).

                  • This will rock the apple-cart of climate science
                    http://ContextEarth.com/2015/11/14/whuts-up-with-posting-all-these-qbo-fits/

                    There’s a recently retired pretentious blowhard by the name of Richard Lindzen, who incidentally is a vocal AGW denier. No one dared touch his model of atmospheric winds, which Lindzen devised over 40 years ago.

                    Well, as it turns out, his theory is wrong and it is really just the lunar gravitational pull that is causing the oscillations.

                    Since Lindzen is wrong on this, why would you trust him on him saying that AGW is not as bad as feared. Lindzen was a professor at a prestigious school MIT, and all the other denialists used him as an “Argument by Authority” expert when it came to attacking those who believed in AGW.

                    Javier says: “I know how science works.”

                    The moral is that you have to be careful of who you listen to in climate science, and people like Javier and Richard Lindzen are not the ones to rely on. They have their own political agenda so you have to be careful.

                  • Javier says:

                    Doug,

                    So, do you assume labeling scientists as liars somehow contributes to a discussion?

                    There is nothing special about scientists. If priests are capable of committing crimes, why do you think scientists are incapable of lying?

                    When a scientist is leading people to believe that we are at risk of an entire glacier suddenly melting and rising sea level by 16 inches, I now you would prefer me to say that he is telling a tale. But when somebody knows that something is not true and yet he abuses his authority as an expert to mislead people into believing in it, the correct term is that he is lying.

                    We have been over this discussion before. Politicians lie all the time, and some scientists have decided that regarding climate alarmism, it is ok to lie because it is a noble cause. It is not me who says it, but them. In the words of Stephen Schneider:

                    On the one hand, as scientists we are ethically bound to the scientific method, in effect promising to tell the truth, the whole truth, and nothing but — which means that we must include all the doubts, the caveats, the ifs, ands, and buts. On the other hand, we are not just scientists but human beings as well. And like most people we’d like to see the world a better place, which in this context translates into our working to reduce the risk of potentially disastrous climatic change. To do that we need to get some broad based support, to capture the public’s imagination. That, of course, entails getting loads of media coverage. So we have to offer up scary scenarios, make simplified, dramatic statements, and make little mention of any doubts we might have. This ‘double ethical bind’ we frequently find ourselves in cannot be solved by any formula. Each of us has to decide what the right balance is between being effective and being honest. I hope that means being both.

                    http://www.americanphysicalsociety.com/publications/apsnews/199608/upload/aug96.pdf

                    So if some scientists defend publicly that it is ok to lie about climate change, why should I be criticised for calling them liars when they do so?

                    Like the rest of the scientists they should just limit to what they can demonstrate.

                  • Javier says:

                    WebHubTelescope,

                    So it has taken us 40 years to find out that Lindzen hypothesis of atmospheric winds is incorrect. Good, that is how science advances.

                    It also demonstrates that very often the dominant theory that most scientists accept during decades can and often will be incorrect.

                    I just hope it doesn’t take us 40 years to find out that AGW hypothesis is incorrect.

                    Regarding political agendas, you don’t know me, so stop making things up. Ad hominem arguments are a sign of poor debating skills. I have been called a denier from people that believe global warming is all man-made and a climate alarmist from people that believe global warming is all natural. Both positions are clearly absurd but curiously most people seem to choose one of them and react very strongly to anybody that does not agree.

                  • Javier,The problem is not with climate science. The problem is with pretentious blowhards such as Richard Lindzen and yourself.

                    You all should see Lindzen in action. He takes potshots at all his climate scientist colleagues, claiming that most smart scientists go into more challenging fields. And that AGW is not significant because these climate scientists do not know what they are doing.

                    And he gets away with this because he sounds so intellectually refined and pompous when he talks. I am sure lots of scientists are intimidated by Lindzen as he gets to flash his credentials from a top research university such as MIT.

                    Lindzen may be smart but he has an agenda. His agenda is to be a contrarian, and get paid by the oil companies for his talks.

                    With this new model of QBO, I am trying to put him in his place. Now that he is retired, not much that he can do, but he deserves all the scorn and contempt for all the evil he has done.

                    I really don’t care about you Javier, but you are emblematic of what climate scientists are faced with every day. This just doesn’t happen in other scientific disciplines — largely because the politics isn’t there.

                    http://contextearth.com/2015/11/14/whuts-up-with-posting-all-these-qbo-fits/

                • ezrydermike says:

                  hmm, I wonder watt’s up with that?

                  • Javier says:

                    Oh yes,
                    watt’s up with that. They call me a climate alarmist over there for defending that there is evidence of anthropogenic global warming.

                    http://wattsupwiththat.com/2015/11/06/is-climate-science-settled-now-includes-september-data/#comment-2066323

                    Very few people is capable of dispassionately discuss about climate change looking at the evidence and trying to find out the truth.

                  • Dennis Coyne says:

                    Hi Javier,

                    Interesting claim that some scientists lie, how do we know which ones? Just those that disagree with your views, or only the experts in climate science?

                    Are you the only one who looks at the science dispassionately, and possibly a couple of others who agree with you?

                  • Javier says:

                    Hi Dennis,

                    I have ample experience with lying scientists. For example when I was a postdoc at a big lab of a Howard Hughes’ researcher (a big shot scientist with an outstanding list of publications), a grad student in the lab had been following a particular line of research for many months, but the data refused obstinately to yield the desired outcome. Five of us were at the computer room next to the boss office were a meeting was taking place between the student and him. We could hear a strong discussion inside and when the door slammed open she emerged red-faced while we clearly heard our boss scream: “I don’t care how you do it, but go downstairs and get the data.” The next day miraculously the data that was not coming for months have been produced with the desired outcome. All of us were very familiar with the research and knew the data had been fabricated, yet nobody said anything and the results were published in a first rate journal.

                    It is not the only instance. When one is one of the leading experts in a particular aspect of a particular phenomena of a particular field, sometimes one knows that what the competition is publishing is not right. In some cases it goes beyond an honest mistake and clearly the data looks to have been manipulated. Since they are small issues it is not worth to go into a direct confrontation and sometimes a new paper with more correct interpretation can be published but other times not even that is worth it. Some groups have a well deserved fame of being unreliable within the field, yet they continue publishing. The pressure to publish to survive the highly competitive scientific research of the last decades has pushed quite a few to be less than honest. Not much of this is discussed even when a notorious case like the South Korean cloning scandal is discovered. It goes against every one’s interest to damage science reputation.

                    So how to know when a scientist lies? In most cases it is not possible for anybody outside the particular field, but it is clear that when they go way beyond what the data supports and defend scary highly improbable scenarios as if they were about to happen you have found one.

                    Are you the only one who looks at the science dispassionately, and possibly a couple of others who agree with you?

                    Obviously not, and agreement is no criteria. But I can tell you that anybody that defends that global warming does not exist or is entirely natural (that includes most US right wing, and many wrongly called skeptics that refute CO2 role) and anybody that defends that global warming is entirely man-made (that includes many scientists, IPCC and every alarmist) is not looking at the evidence dispassionately and are contributing to fool people and subject to a very strong confirmation bias.

                  • Javier,
                    The worst cases of lying are from the contrarian side of the climate science debate.

                    I just showed you what a fraud Richard Lindzen is. There is another fraud, Judith Curry, from Georgia Tech, who writes the worst tripe ever. I caught her trying to apply Bose-Einstein statistics to an atmospheric problem in a textbook. Embarrassing if you know anything about quantum physics. She sent her goons after me when I placed the criticism as an Amazon book review.

                    And don’t forget Roy Spencer, who said some really dumb stuff recently.

                    So if you are going to pick the most honest, I suggest that you don’t side with the losers.

                  • Dennis Coyne says:

                    Hi Javier,

                    On one point at least we agree. There is both anthropogenic climate change and natural climate variability. As far as I have read there aren’t any climate scientists that would claim otherwise.

                    I also think that the RCP 8.5 scenario is either impossible or highly unlikely at best so that papers that focus on the so-called “business as usual” scenario are not very convincing. There just aren’t enough economically recoverable resources to allow it to happen. The RCP6.0 scenario should be as far as it goes, but many people such as Leo Maugeri and Michal Lynch claim that there is much more fossil fuel resources than I think is reasonable. The RCP 8.5 scenario is included to keep the cornucopians happy, but the climate scientists should not spend much time focusing on that scenario in my view.

                    There is still plenty of fossil fuel to do damage if the ECS is 4C.

                  • Javier says:

                    Hi Dennis,

                    Then you are closer to me than to IPCC. I already showed that only 17% of scientists agree with IPCC in that anthropogenic GHGs have contributed more than 100% to recent warming (with other anthropogenic cooling contra-resting some GHG warming). 83% of scientists think that there is some natural contribution to warming.

                    Industrial CO2 has increased from 280 to 400 ppm and temperatures have raised about 0.8°C. This suggests a TCR of about 1.1°C per doubling only if all the warming is due to CO2. If part of the warming is natural then the TCR falls proportionally to the amount of natural warming that you allow. Do you see why IPCC cannot allow any natural warming at all? The alarmism dissolves as Arctic ice in the summer if you just allow even a moderate amount of natural warming.

                    The evidence shows that CO2 is significantly less powerful warming agent than assumed by IPCC and that is the reason why models are all running too hot and why they are not capable of reproducing Holocene climate. However if IPCC moderates its posture all the alarmism goes down the drains, and the alarmism is what keeps the circus (and the money) rolling.

                  • Dennis Coyne says:

                    Hi Javier,

                    There is natural variability from variations in solar output, volcanoes and ENSO.

                    The variability is not really the same as warming, it will tend to oscillate based on random volcanic events, the natural cycles of the sun, and on whatever determines the variability of ENSO.

                    Variability is not the same as warming over the long term. So no I am not as close to your beliefs as you think.

                    The CO2 is the main source of warming over the long term (when the various feedbacks of increased CO2 are included).

                    The natural variability confounds the analysis if you don’t look at long term (30 to 40 year) temperature trends.

                  • ” This suggests a TCR of about 1.1°C per doubling only if all the warming is due to CO2. “

                    On land it is closer to 3°C per effective doubling according to observational data. Too bad that humans live on land.

                    And I bet you don’t understand what the “effective” means.

                  • Dennis Coyne says:

                    Hi Javier,

                    There is natural variability, that is much different from natural warming. There has been a long term warming trend, since the industrial revolution. On top of this rend there is natural variability from changes in solar output (relatively small effect), volcanic eruptions (fairly random in size and spacing), and ENSO and other oceanic effects, the natural variability tends to confound the observational data unless you consider longer term trends (30 years or more).

                    So no, I am close to the IPCC which has a large range on the ECS of 2 to 4C, with a best guess of 3C.

                  • Javier says:

                    Hi Dennis,

                    Those values are theoretical calculations from models. In truth we only have an experimental value, which is the amount of CO2 that we have put into the atmosphere from pre-industrial values and the amount of warming that we have measured since that time. And then a bunch of excuses for why that gives such a low value.

                    You seem to know about modern warming but not much about historical climate. Present global warming is about 350 years old from the depths of the Little Ice Age around the 1690’s, perhaps even older. This is about 150 years before the industrial revolution. Natural variability is not well accounted for because it has been responsible for nearly all the warming during at least 280 of those 350 years, while CO2 is told to be responsible for the warming between 1975 and 2000, only 25 years (7% of the 350 years warming trend). Well it is damn convenient that after 280 years natural warming stopped just when we started to put CO2 in the atmosphere, or perhaps it hasn’t.

                    And to WebHubTelescope, yes, I do understand. Effective doubling is the one that includes the effect from the rest of GHGs as if they were converted to the amount of CO2 that would produce the same warming. You can complicate the issue all you want but in reality is very simple. We put a lot of CO2 in the atmosphere, but we get very little warming in return, and to make matters worse part of that warming may not even be due to CO2. All the rest is making excuses for a hypothesis that fails to explain the evidence and fails to make predictions.

                    Anybody younger that 20 should consider that they have never experienced global warming first hand. They just have been told about it repeatedly. This is despite the fact that during that period we have put 25% of all the CO2 since the industrial revolution. Nothing in the Anthropogenic Global Warming Hypothesis formulated by IPCC explains this surprising outcome. After such huge failure AGW hypothesis appears to have its support intact. Probably the lack of a serious contender hypothesis explains this contradiction, but we will not get an alternative hypothesis unless we accept that we need one. Perhaps some serious cooling after this El Niño will do the trick.

                  • Dennis Coyne says:

                    Javier,

                    The physics is well understood for the basic greenhouse effect. Clouds complicate the matter, as do aerosols, and ocean currents.

                    There really is no decent alternative hypothesis that stands up to scrutiny.

                    We really don’t have great temperature data globally before about 1850, so claims of the “little ice age” may have been a local cooling effect in Europe. And there is natural variability, nobody claims there is not natural variability.

                  • Javier,
                    3C for effective doubling of CO2 is what it was when the Charney Report was released in 1979, and it is still 3C today.
                    The science has been very consistent on this, and if you want to rewrite history with your delusions, go right ahead.

                  • Javier says:

                    Hi Dennis,

                    so claims of the “little ice age” may have been a local cooling effect in Europe.

                    Those claims are bogus, we do have lots and lots of evidence that LIA was the coldest period of the entire Holocene from all over the world, from glaciers on New Zealand to ice cores in Peru and marine sediments from many locations in both Hemispheres. I could provide dozens of references, but why should I bother? By saying that you demonstrate that you not only don’t know much about LIA, but also that you are willing to support anything that IPCC says and their politically motivated party-liners parrot without any minimal checking, no matter how outrageous. If you are interested in the truth you can do your own little bibliographic search on LIA outside Europe, perhaps that way you will realize how you are falling hook, line and sinker for a politically motivated reinterpretation of the climatic history.

                  • Dennis Coyne says:

                    Hi Javier,

                    Reading very briefly on this, it looks like recent estimates show that the climate optimum during the Holocene ( from about 8000 BC to 3000 BC) was roughly 0.4 C above the 1960-1990 average global temperature level.

                    I believe this is taken into account when climate scientists suggest 2C above pre-industrial Holocene.

                    https://www.climate.gov/news-features/climate-qa/what%E2%80%99s-hottest-earth-has-been-%E2%80%9Clately%E2%80%9D

                    I am confident that climate scientists are aware that the climate has varied in the past, the rapid change in temperatures over a very short time frame, relative to history, is a big part of the problem.

                  • Javier says:

                    Hi Dennis,

                    Good thing that you finally accept that the LIA is global and the colder period in the entire Holocene, as that link shows, and not those bogus claims from IPCC that you were repeating before.

                    Marcott et al., 2013 estimate of 0.4°C temperature variability for the Holocene is against scientific consensus in this issue and looks too low. There is a lot of data pointing that global temperature change from glacial to interglacial is of 4-9°C and Holocene variability therefore has to be between 1-2°C. If Holocene variability was only 0.4°C then the difference between glacial and interglacial should be of only 2°C as one is 20% of the other (see figure).

                    Also we know that globally glaciers were shorter and had less mass than now during the Holocene Climatic Optimum and were maximal during LIA. This is pretty solid knowledge based on hundreds of glaciers from most parts of the world. If Marcott et al. were right and only 0.4°C separated the HCO from the LIA, then present warming of 0.8°C should have completely melted most glaciers of the world. As this has not happened and glaciers are still longer than during HCO, Marcott et al. are with all probability wrong.

              • oldfarmermac says:

                NOTICE LONG COMMENT ON NUANCE , SKIP IF INTO SOUND BITES

                Every body in this forum at least must know by now that I am a firm believer in forced climate change, which will be mostly experienced as warming, and that it is NOT a good thing.

                BUT Javier has a point, if you are willing to consider his pov.

                Depending on where one stands, in the forest, in the fringes of the forest, or quite a distance away from the forest,so as to be able to see the whole thing, the word”settled” can and DOES mean very different things.

                A few days back, I believe it was HVAC GUY who lectured me on what a breakthrough is, or is not, citing the example of a ten percent improvement in solar cell performance as worthy of being called a breakthrough accomplishment.

                To people in the photovoltiac forest, or in the fringes of it, ten percent better performance no doubt IS a truly remarkable accomplishment, and I do not dispute that it resulted from the hard work of countless brilliant engineers, physicists, etc.

                BUT English is English, and a ten percent improvement in solar cell performance is to a layman like me just another incremental improvement in just another technical field, and it is certain that the vast majority of people on the street see it the same way, given that the average man on the street has probably not devoted even ten minutes serious thought to solar cells in his entire life.We are used to things working better and have come to EXPECT things to work better year after year.

                So- IT IS settled that the planet currently experiencing a warming trend, and so far as I can tell, NOBODY denies this, excepting maybe a few quacks.

                Next- A VERY VERY FEW real scientists, just a handful in total, believe this trend is entirely natural. Given that the overwhelming majority of scientists in the field ( in the forest ) or possessed of relevant expertise (analogous to being on the fringes of the forest ) believe part of the warming trend, or most of it, or all of it, is due to our activities, it is perfectly reasonable to say
                the warming trend is unnatural or forced.

                But when you get down to the details of actual evidence pro and con, there is still room for debate about said details.

                I am not a professional nutritionist by any means, but I have been following the science of nutrition, given that I am a university trained ag guy with academic credits in nutrition, and a livestock farmer (and orchardist ) retired, not to mention an individual concerned about my own health, since I was an undergrad in the dark ages.

                There are debates in the field of nutrition that have been raging for most of a century, but the field is gradually becoming truly settled.

                Hardly ANYBODY disputes for instance that calories OUT ( expended ) must exceed calories IN ( net digested ) in order to lose weight deliberately.

                Hardly ANYBODY disputes that more calories in than out results in weight gain, assuming normal metabolism.

                The few people who dispute these basic agreed upon “laws ” of nutrition are considered by reputable health care professionals to be either quacks or crooks, mostly crooks trying to peddle weight loss pills.

                But if you want to debate the exact role of animal fat versus vegetable fats, or too much grain , or fruits and vegetables in a healthy diet, you can present papers at professional conferences , as many as you have time to write.

                HOWEVER , you will NOT find anybody at any of these conferences disputing whether gaining weight is the result of consuming more calories than are expended. The BASIC science of nutrition is settled.

                The BASIC science of climate IS settled.

                There will be disputes about the details, for as long as the study of climate continues.

                Some people who dispute forced climate change are honest skeptics, no doubt in my mind.

                But I am also convinced that a lot of skeptics, maybe or probably most of them, have a hidden agenda involving political or economic arguments.

                We must also consider the way climate science is presented to the public via the MSM, as opposed to the way scientists present it to each other, and to the public for the most part.

                Just about anybody with a working brain who reads anything in the msm media will agree that the media tendency is to shoot for audience share rather than to soberly and accurately present the actual facts.

                You get audience share by printing alarmist headlines, and cherry picking reasoned arguments for the most alarming facts or possibilities, and ignoring the rest of the argument.

                The environmental movement is NOT entirely honest, from an intellectual pov. I am not saying it should be, neither is any other political or scientific movement, in or out of power.

                People are mostly unwilling to be bothered with actual thinking, and mostly incapable of thinking anyway, when it comes to scientific or technical questions, since most people are technically illiterate.

                The fossil fuel camp lies, all the time, day in and day out, and will continue to do so.

                The environmental camp must be expected to do a little of the same, in terms of being alarmist.

                Furthermore, the actual facts are on the side of the environmental camp, and even the most alarmist statements coming out of it might be understated.

                If the people working on fusion power were actually TOTALLY HONEST, when talking publicly, about the undeniable fact (corner one of them and he must admit it ) that actual fusion reactors feeding the grid will not be built within the lifetime of the forum members reading this today, they would all be looking for work next year, when current funding runs out.

                Hopefully funding for climate research will NOT run out, but if the right wing peddlers of FUD manage to get control of Washington, it could happen.

                It is not a wise thing to insist that every conclusion drawn from every piece of climate research is going to be accepted as accurate long term. Some conclusions will be proven wrong or premature , and the naysayers will latch onto you like a leech, eventually.

              • According to some wags, modern climate science is based on the democratic vote of experts. I think they use an electronic voting system.

                • ezrydermike says:

                  Others say the best Cuban sandwich comes from Tampa. Who knows what that’s based on, nobody asked me.

                  • Fred Magyar says:

                    As do the best Cuban Cigars… Go figure 🙂

                  • Old Cuban colony was settled in Tampa over 100 years ago. They are an odd lot, play that wimpy o-6 dominoes, don’t put pickles in their half moon sandwiches, and speak English with a funny accent

  7. Dennis Coyne says:

    Hi All,

    Enno Peters creates lots of great charts for North Dakota.

    One of these shows how output might change if 120 wells, 90 wells, …. are added each month in North Dakota.

    Hopefully Enno won’t mind if I copy his work and do something similar for the Eagle Ford (using Rune Likvern’s Red Queen type of model). Below I show what will happen in the Eagle Ford play if the well profile remains stable and a different number of new wells are added each month.

    There are four scenarios: 160 new wells per month, 120 wells/mo, 80 wells/mo, and 40 wells/month. In each of the scenarios the number of new wells per month is constant from Sept 2015 to Dec 2016. Note that from Sept 2014 to August 2015 the 12 month average was 200 new oil wells per month added in the Eagle Ford play. The output is C+C output in kb/d (left vertical axis).

    • Dennis Coyne says:

      For a scenario with 100 new wells per month added from Sept 2015 to Jan 2020 (in the middle of the scenarios above between 80 wells/mo and 120 wells/mo) the legacy decline in kb/d is shown in the chart below. It decreases rather than increases as shown in the EIA’s drilling Productivity Report (similar to the Haynesville play). When the output of a play is decreasing over the long term the legacy decline will be decreasing over time rather than increasing.

      • gwalke says:

        Hi Dennis,

        Is this well profile data from the RRC? I haven’t turned my attention to Eagle Ford yet, so I’m looking for good data sources. I’ve only had a brief look so far, but the highest granularity I could get was only lease level data.

        • Dennis Coyne says:

          Hi Gwalke,

          The original well profile was based on wells that started producing between 2010 and 2013 (only about 500 wells from the Eagle Ford 1 and Eagle Ford 2 fields). I used wells that either started production within 2 months of each other on the same lease (for multi well leases) or used wells that were the only well on the lease at the time.

          Since 2013 the model started to fall behind actual output so I increased the well profile to match the output data (without going back to dig up the individual well data, which is too difficult).

          EUR is 215 kb up to Dec 2013, increases to 230 kb Jan 2014 to July 2014 and gradually increase to 248 kb by Dec 2014, then the EUR starts to decrease and falls to 234 kb/d by Sept 2015 and EUR continues to decrease at 4.8% (if 100 new wells per month are added), by Jan 2020 EUR has decreased to 189 kb.

          Clearly after Sept 2015 we have no idea if the EUR will decrease at the rates I have guessed, nor do we know that EUR has increased as I have modelled (I simply took the 2013 well profile, used from 2010 to 2013 and assumed each month increased in output by the same percentage).

          At some point the sweet spots will become saturated with wells and the EUR will decrease as less productive areas are drilled.

          When this will occur and what rate the EUR will decrease is unknown.

          The model is highly speculative for the Eagle Ford, not nearly as good as Rune Likvern’s Red Queen Model for the Bakken.

          Also note for the Eagle Ford about 20% of of C+C output is condensate and there are a lot of gas wells producing the condensate. I did not attempt to model the condensate output from the gas wells, I looked at oil wells only. The model finds crude output and then assumes the condensate output will be at an 80/20 ratio (this is the current ratio, but I use the actual ratios based on RRC data for past months to get the “model C+C” and then assume the most recent month ratio continues into the future.

          Note that the EUR that I gave above was for crude only for 215 kb for crude the EUR would be 269 kb of C+C at an 80% crude to C+C ratio.

          • gwalke says:

            Thanks for this Dennis. It is a shame the RRC don’t have a similar system to the DMR, but I suppose they are a) older and b) deal with a larger dataset. I know that when we look at the Gulf of Mexico, it seems like a lot of it is set-up for dot matrix printers…

            • Dennis Coyne says:

              Hi Gwalke,

              If you are interested I can send you the data I dug out (it is now a year or two old).

              • gwalke says:

                Absolutely, that would be great if you could send it to grahwalker at gmail dot com . Thanks a lot, Dennis.

                • Dennis Coyne says:

                  Hi gwalke,

                  I remembered incorrectly, I only have data on 317 wells rather than 500 wells as I said earlier.

                  The data can be found at the link below:

                  https://drive.google.com/file/d/0B4nArV09d398OTJTcFlDS3BlVGM/view?usp=sharing

                  For crude only the EUR is 219 kb if we assume the well is abandoned at 5 b/d at 196 months after the start of production. If we assume the ratio of oil to gas wells remains at present levels, about 25% more C+C will be produced than crude alone (with the condensate produced by gas wells) so I assume another 54 kb of condensate gets produced by gas wells in my Eagle Ford model, in addition to the 219 kb produced by each oil well. The ratio of crude to C+C was between 79% and 80% from June 2014 to August 2015.

                  The hyperbolic well profile based on the first 24 months of output is in the chart below.

  8. oldfarmermac says:

    I doubt if it will affect oil and energy markets but there is an ongoing refugee crisis in our Yankee backyard too.

    http://economictimes.indiatimes.com/news/international/world-news/nicaragua-closes-border-to-cuban-migrants-rebukes-costa-rica/articleshow/49797130.cms

    I for one spend a lot of time cruising the news, but I was until now unaware that so many Cubans have been able to make the mainland headed this way.

    While I am concerned about large scale immigration, a few thousand people coming into a country as large and populous as the USA is nothing to get excited about. We should be careful to do a good job screening any refugees allowed in of course, most especially young men without wives and kids, who are more apt to be sleepers, but even a hundred thousand new people in this country would be a trivial addition to our three hundred million.

    But in a country the size of Germany, a million in one year is a hell of a lot, and that many a few years running could severely disrupt life for the Germans themselves, especially Germans near the bottom of the economic ladder.

    • We Cubans don’t sleep much. Most of those Cubans are fleeing out of fear of having to live in the dictatorship backed by Obama and USA imperialist multinationals.

      Since Obama started making cooing noises the regime has become bolder in the way it abuses the people, and many youngsters think change won’t ever come now that the Castro family dictatorship is backed by the USA.

      • oldfarmermac says:

        Hi Fernando, I would be extremely surprised if a Cuban refugee turned out to be a terrorist bomber- for a fact!

        I am not in favor of allowing MILLIONS of people of any sort, not even little green men from Mars, into the USA, but so far as I am concerned personally, Cubans are welcome.

        There are people in and around Miami who have a different opinion on this matter.

        It is too bad Castro is or used to be such a smart devious sob. He sure knew knew how to poison public opinion in this country against his own people.

        • I’m not worried about Cuban wetbacks. They are getting treated bad by everybody, but that’s life. If the Nicaraguans close transit to Cubans (who don’t particularly like living in a commie country), then I’m sure we will find a way to screw them back in the future. They are a bunch of beaners led by a pedophile.

          The USA has the right to refuse an uncontrolled flow of illegal aliens. And if they want to close off entry to Cubans then that’s fine. It should make the island boil over, and we can line up the Castros and put ice picks in their heads.

  9. Ron, is there a RRC data split-up into Permian and Eagle Ford like in the drilling productivity reports?

    Here is my take:

    16/11/2015
    IEA: US$ 40 oil means 3 mb/d less tight oil in 2020
    http://crudeoilpeak.info/iea-us-40-oil-means-3-mpd-less-oil-by-2020

    • is there a RRC data split-up into Permian and Eagle Ford like in the drilling productivity reports?

      I am sure that data exists somewhere but I have not dug it out. Perhaps someone on the list will do that for us?

      • Dennis Coyne says:

        Hi All,

        The Eagle Ford is roughly districts 1, 2, 3, 4, and 5 in the EIA’s drilling productivity report, but district 1 and 2 represent the C+C output much more closely (I have dug out the data for the specific fields of the Eagle Ford Play and compared it with the data from districts 1 and 2 combined and it is within 1 % (with districts 1 and 2 including some conventional output which is slightly more (0.75% roughly) than the Eagle Ford Play C+C output from districts 3, 4, and 5).

        For the Permian use districts 7C, 8, and 8A see

        http://www.rrc.state.tx.us/oil-gas/major-oil-gas-formations/permian-basin/

        The Permian data includes roughly 500 kb/d of conventional output. I estimate by finding Eagle Ford to total TX C+C ratio and Permian to total TX C+C ratio and then multiply by Dean’s central estimate. This is an approximation, but probably the best we will do.

      • Dennis Coyne says:

        Hi Ron,

        Here is my latest Eagle Ford(EF) estimate, using RRC data to find the EF to statewide TX C+C ratio and then multiplying by Dean’s statewide TX C+C estimate to find my EF estimate. Chart below, Sept output 1465 kb/d, up 21 kb/d from August.

        • Dennis Coyne says:

          An older Permian chart from July 2015 (data through April 2015), same method as Eagle Ford estimate.

      • Dennis Coyne says:

        Hi all,

        I have updated my estimate for the Texas Permian basin using RRC data and Dean’s estimate for Texas. Data is through Sept 2015. September output for TX Permian basin C+C is about 1644 kb/d. Chart below has data from Jan 2010 to Sept 2015.

    • AlexS says:

      They have charts for Eagle Ford and Permian production of oil, condensate and natural gas:

      http://www.rrc.state.tx.us/oil-gas/major-oil-gas-formations/eagle-ford-shale/
      http://www.rrc.state.tx.us/oil-gas/major-oil-gas-formations/permian-basin/

      Texas Permian Basin Oil Production 2008 through August 2015

      • Dennis Coyne says:

        Note that the chart from the RRC suffers from the poor data in the RRC’s PDQ, through 2013 the data is pretty good (old data from 2012 and earlier is probably close to perfect), the 2014 and 2015 data underestimate actual output, like the drooping output lines in the RRC charts in Ron’s posts. My estimate will not be perfect, but will be much closer than the RRC data for Jan 2014 to the present.

    • Heinrich Leopold says:

      Matt,

      Thanks for the link, which is very interesting, especially the chart about well productivity. As the monthly decline of Eagle Ford accelerated over the latest few months (see below chart), I am wondering if the shale decline would be much steeper and faster as currently forecast. The reason could be the fast declining well productivity (-11.5% for North Dakota and -17% for Bakken in September).

      • Dennis Coyne says:

        Hi Heinrich,

        The decline is due to fewer well completions. In the Eagle Ford the number of wells completed per month has dropped. The well productivity (as you define it) always drops once the output from new wells added each month drops below the legacy decline from wells already drilled. If more wells are completed as oil prices rise the decline may be stopped or even reversed. There is no evidence that the well productivity of individual wells (rather than of the average productivity of all wells regardless of age) of the same age (say 6 months since the well was completed) has decreased. Eventually this will happen, when and how quickly well productivity will decrease is unknown.

        Maybe the barrels per day per well should be called the “play productivity” as it reflects the average of all wells in the play. Or I could use the term “individual well profile” rather than well productivity. Or maybe someone from the industry could tell us the proper use of these terms, as I have no experience (as Rune Likvern likes to remind me) in the oil and gas industry.

        • Heinrich Leopold says:

          Dennis,

          As the amount of producing wells increases, the number of new wells must increase accordingly. If companies want to keep production flat, they must actually increase wells more and more over time. It is also the law of high numbers, which eventually brings down any trend. However, at these low prices companies simply cannot increase the number of new wells and production declines as the proportion of faster declining wells increases. Nevertheless, the decline is now enormous. If you think about the -78 000 bbl/d and month decline in the Eagle Ford, it means that the Eagle Ford is extinct by the end of next year. And so far there is no end in sight of the decline in production. Only a major event – a spike in oil prices – can stop this. You can calculate this also by the monthly decline of the growth rate, which is around 2 % per month and accelerating. So in around one year the decline will be at least 30%, which is nearly 3 mill bbl/d. And this is conservative as this assumes a roughly stable decline rate from now on. So far, the decline rate has increased steadily. This is what the numbers say and I have just assumptions what the reason for this decline may be. In my view most people and investors are not aware how dire the situation for shale companies is.

          • Ves says:

            Heinrich: “In my view most people and investors are not aware how dire the situation for shale companies is.”

            How they can be aware? Don’t you see that shale companies are talking in some dialect of shale Esperanto language that only they can understand 🙂
            Thousands of blogs and articles by experts and nobody can coherently explain in two paragraphs what technological innovation we are talking about. It is so advanced innovation that they are all broke while pursuing it 🙂 LOL

            It’s all delusion.

            • Heinrich Leopold says:

              Ves,

              But the numbers cannot lie. From spring to October the growth rate came down from 15% to actually 0. Until spring 2016 we will be at -15% and in the fall next year at – 30% . At the end of 2016 US oil production could be even below 6 mill bbl per day – if it is strictly going by the numbers and there is no major event such as an oil price spike. However such a big move will anyway trigger a response somewhere. Maybe I overlook something, but so far I cannot see what will stop this train.

              • Ves says:

                No disagreements from me. Al I am saying if technological innovation is real shale would be making money and maintaining production. So far we know that they have not been making money at $100 and as far maintaining production that looks very wobbly if they are running out from sweet spots as it how it looks to me based on decline of number of active rigs within just 1 year of low prices. Well if you don’t drill we know what happens with production in high decline wells.

          • Dennis Coyne says:

            Heinrich,

            The legacy decline will decrease over time, not increase as you suggest.

            I have modified the Eagle Ford model so that the well profile remains the same over time, below I show the legacy decline in kilobarrels per day for each month if no new wells are added after August 2015. Now you may say this is unrealistic, if so how many new wells per month do you think will be added if prices remain $60/b or less long term?

            • Dennis Coyne says:

              Hi Heinrich,

              For the Eagle Ford if no new wells are completed or connected to pipelines for sales, output drops by about 1000 kb/d by Dec 2016.

              Scenario below. I do not think this realistic, but claims that output will drop in the US by more than 3300 kb/d by the end of 2016 are absurd.

            • Dennis Coyne says:

              Hi Heinrich,

              What about the Bakken? Lets also assume no new wells are added there after Sept 2015 (also unrealistic, but I am looking for maximum decline). Output drops by 460 kb/d for the Bakken/Three Forks of North Dakota by Dec 2016. The total decline for the Bakken and Eagle Ford would be 1460 kb/d with no wells added from Sept 2015 to Dec 2016.

              Where do you expect the other 1840 kb/d to come from to create a 3300 kb/d decline? The Permian basin (which is rising at present)? Chart with unrealistic Bakken scenario below.

              • Dennis Coyne says:

                Note to all,

                A more realistic scenario would be a drop in US C+C output of 500 to 1000 kb/d by Dec 2016, depending upon oil prices, low prices (under $50/b) are more likely to result in a bigger decline in output, near the high end of my range. If prices make it to $70/b by the end of 2016 we may only see a 500 kb/d decline. I have no clue what will happen to oil prices, only Watcher knows.

                • Heinrich Leopold says:

                  Dennis,

                  Thank you for your replies. Your feedback is important to me as the discussions of this website let me think about my own views. I understand your arguments very well, yet they are based on the change on few variations. Yet most systems are multivariante, containing many interactions, which result in many cases in a surprise outcome. Shale production is very much based on the belief on a soaring oil price and manifold share price increases. It is the nature of an investment that investors expect a return. Nobody would invest when he knows for sure that he will lose money. This is what is the most important variable in the shale game now. As expectations for a price increase are fading – all my forecasts were here spot on – any investor in the shale game knows for sure that he will lose money. So most people will not invest, they will rather divest. The reaction will be that there is less money available for new wells. In my view it will be going beyond lower investments , but shutdown of wells in droves (this is the logic base of the Seneca curve – investors will go into a trend step by step, but then go out immediately at once). This is not built into your model. Another variable, which is not built into your model is that there maybe an overestimation of reserves due to a high initial pressure of wells, which turned out to be a mirage as well pressure fell much faster than in conventional wells. There maybe some other variables, which I am equally not aware of, yet the most important variable is that it is in my view possible to see the strength of a trend from the initial growth (or decline) rate. As it has been foreseeable from the initial growth rates in 2011 (production has been still quite low in 2011), that shale production will be big over the following years, it is equally possible to see from the current massive decline rates that the decline will be big in the next years – whatever the reasons may be.

                  • Heinrich Leopold says:

                    Dennis,

                    Below a chart of total US production, which shows a huge decline rate, which will likely decline at the same or higher speed as the oil price does not increase and the investment environment (bond market) worsens by the day.

                  • Dennis Coyne says:

                    Hi Heinrich,

                    Take a look at the chart. The trend often changes directions rather rapidly. Just because output has declined since March 2015 for oil does not mean the trend will continue.

                    Predictions of less than 6 Mb/d for US C+C output are not realistic. If you only meant lower 48 onshore output, that is a possibility, but in an earlier comment you said:

                    At the end of 2016 US oil production could be even below 6 mill bbl per day – if it is strictly going by the numbers and there is no major event such as an oil price spike.

                    In August US C+C output was 9324 kb/d (EIA data) and in March it was 9558 kb/d, all but 1 kb/d of the decrease in output was from combined decreases in North Dakota and Texas and 94% of the US decline was from Texas, with all of this decrease being from the Eagle Ford play.

                    I asked you before what you think would be a reasonable guess for new wells added in the Eagle Ford, but you gave no suggestion. You seem to think the DPR is a reasonable estimate for future Eagle Ford output (it isn’t it is far too low) so that would suggest about 60 new wells per month.
                    The scenario below shows Eagle Ford C+C Output with 60 new wells per month from Oct 2015 to Jan 2017. Output of C+C falls in the Eagle Ford play by 600 kb/d, far short of the 3300 kb/d that you estimate.

                  • Dennis Coyne says:

                    For the scenario above the legacy decline in kilobarrels per day falls from 138 kb/d in August 2015 to 48 kb/d in Dec 2016. If the number of new wells added per month falls from recent levels of around 180 new wells per month to 40 new wells per month, the legacy decline falls sharply as shown in the chart below, where I have assumed 60 new wells per month continue to be added until Jan 2020.

                  • Dennis Coyne says:

                    Hi Heinrich,

                    You posted a chart at the comment linked below

                    http://peakoilbarrel.com/texas-rrc-2/comment-page-1/#comment-546713

                    If we include data from Jan 2015 to Aug 2015 and use the DPR data through Dec 2015 and then extend the scenario with the assumption of 60 new wells per month until Dec 2016, the change in Eagle Ford output from Jan 2015 to Dec 2016 is as shown in the chart below.

                  • Dennis Coyne says:

                    On the overestimation of reserves. My models use very conservative well profiles.

                    The Bakken/Three Forks wells are put on pumps pretty early in there lives, I am not sure if this is also the case in the Eagle Ford.

                    So the lower pressure is not an issue in the bakken as the wells are not on natural drive.
                    Through 2013 the wells were tracking the older wells vey closely, so I doubt there will be any big surprises on the EUR of wells already producing.

                    I will leave it to those who have lived through oil busts in the past whether wells that are producing at say 50 b/d or higher would be likely to be abandoned with no oil companies willing to buy those wells.

                • Heinrich Leopold says:

                  Dennis,

                  My suggestion for new wells added for Eagle Ford and also for Bakken is that many wells have to be shut down, probably many thousands. This is my main point. This is why I think production will collapse. CHK bonds did already fall to 50 cents as debt is three times assets. Companies do not get funding for operations. Think at the Seneca curve. Oil is below USD 40. The money is panicking out of oil companies. These are not normal times. You have to price in chaos into your models.

                  • Dennis Coyne says:

                    Hi Heinrich,

                    The wells that are producing are a sunk cost.
                    As long as the oil revenue covers more than the OPEX, it does not make sense to shut the well down.

                    If companies go bankrupt, stronger companies will buy up the producing wells and the oil will continue to be produced.

                    If you think that all oil production will halt, you are wrong. Oil output will not fall more than 1000 kb/d in the US by Dec 2016.

                    Out of curiosity how many of the almost 20,000 wells producing in the North Dakota Bakken and Eagle Ford do you expect will be abandoned?

                    So it is not just that you think no new wells will be completed you expect wells that are producing and generating positive cash flow on their operations to be shut in.

                    You are correct that my models do not include such a scenario.

                    It is for the same reason I do not use a well profile of 600 kb for the average Bakken well, such a scenario is far from realistic.

                  • Heinrich Leopold says:

                    Dennis,

                    I have have been now over 30 years in the commodity business and I know when revenue falls below cash costs ( revenue – depreciation and interest expense) fire is on the roof and capacity is shut down very quickly as then companies have to pay cash for production. Paper losses do not matter as this is a problem for shareholders, yet cash losses do matter. Many shale companies pay already cash for production – especially for NGL and condensate. This is why condensate in the Texan RRC report shows a massive decline. In any case, this is not sustainable. Even in the case of bankruptcy, the new owner will not produce, but wait for higher prices.

                  • Heinrich Leopold says:

                    Dennis,

                    Just to demonstrate my point I have attached a chart of Texas condensate, which shows already an exteme decline and is a harbiger for future US production.

                  • Dennis Coyne says:

                    Hi Heinrich,

                    For the Bakken and Permian basin there is very little condensate so it is not much of an issue there. In the Eagle Ford the percentage of production that is condensate is about 20%. So I am not buying your condensate story. On shutting wells down, this can sometimes be done, but in some cases this will damage the well, so companies will not shut in wells to wait for higher prices.

                    Perhaps shallow sand or Fernando could comment on this. My understanding is that not completing new wells makes sense.
                    Shutting in older wells with output at 25 b/d or higher does not make economic sense even at $40/b.

          • gwalke says:

            It may be a mistake to do an uncomplicated move from price to production, as the bulk of production (in North Dakota at least) is held by companies who are relatively impervious to price changes due to their business model. That is to say, the bulk of production is controlled by companies who are trying to make the next bond issue, not extract oil and sell it at a profit. This is why Continental, for example, haven’t been cashflow positive in any quarter since 2012. Read the Forbes profile of Harold Hamm from 2014. Leverage is a way of life for him. It is no coincidence that it has taken until September, once they’ve spent most of their capex budget for the year and when seasonal downturns in production occur anyway, for the first y-o-y decline to be seen. It’s the change in strategy of Whiting and Continental that has made the difference.

            This is why production has held flat in North Dakota – the decline in completions from companies that ARE trying to sell oil at a profit (e.g. EOG) was balanced out by increases in production from debt-focussed companies. This explains why every regression we have done on price and production in ND reaches an unsatisfactory result. If banks can borrow money at 0% and can lend it to you at 8%+, price isn’t really a concern so long as you can meet your interest payments. Even if those payments come from the next tranche of debt.

            Which isn’t to say price isn’t having an effect – and it may ultimately be the factor that shows the emperor has no clothes. I’m just putting a health warning on it.

            You are certainly right that most people and investors are not aware how bad the situation is though.

            • shallow sand says:

              I am very aware how bad it is, but have pretty much given up trying to explain it.

              Based on current price action, no one is anticipating an OPEC cut. Probably won’t be one, but in my view it is the only thing absent major political event that will improve prices.

              Right now, Q4 is shaping up to be worse than Q3 and 2016, based on strips, worse than 2015.

              • gwalke says:

                But you are aware because you dig deeply into the data and have a first hand knowledge of the market. The average punter will read Bloomberg and that will be that.

                • Ves says:

                  And that also tells you one more thing and that is that everything is presented as deception. If you dissolve deception you see some really scary numbers in terms of what actually is really sustainable to extract. Shale and Musk fantasies are really just different side of the same coin. Sustainability is the benchmark. If fails that benchmark than no amount of happy talk by the “experts” on technological innovation will make things different. Solution is always the same “Live within you means”.

              • Dennis Coyne says:

                Hi shallow sand,

                Would it make sense to you that companies would start abandoning producing wells at these price levels. On average what would your guess be on the output level of wells that are likely to be abandoned 10 b/d, 15 b/d? Just make a reasonable assumption about the water oil ratio and other operating and overhead costs.

                Another question, which you probably won’t answer. At what oil price do you throw in the towel and sell your wells?

                • shallow sand says:

                  Dennis. Sorry. I think you asked me a question in another post, and I didn’t answer. I meant to, but I have been pretty busy.

                  I think that question had to do with our OPEX. I don’t want to get into specific numbers online, but in general terms we are fighting to not lose money at $40 WTI, which is about $35 for us at the well. We have shut in about 5% of our wells, which basically was the result of deciding to hold off on pump changes or tubing repairs on certain wells. This can get dicey, and we had one royalty owner complain, so we put the one well on her farm back into production. We don’t want to plug any of them, as they are normally profitable at $60+ WTI, but the state will only let us keep them down so long.

                  As to when wells become uneconomic, that varies so much on a well by well basis. For example, if you want to see how much costs vary, look at lease operating statements for wells on the online auction site, energynet.com.

                  Remember the wells we own are very shallow, especially compared to the 15-20K feet wells common with LTO. Also, ours are all vertical.

                  I assume you are interested in LTO OPEX. A rule of thumb I have found for Bakken wells in ND OPEX averages about $14,000 per month. However, I have seen as low a $3,000 on average to as high as $30,000 on average, not including down hole repairs. The down hole repairs and other repairs usually show up as CAPEX.

                  The rule of thumb I had been using was $14,000 per month, plus $100,000 per year of CAPEX. Again, every well is different, and wells vary from month to month. An 8 barrel per day well (net) will be just fine at $3000 per month OPEX and no major CAPEX. It wont at $14,000 per month OPEX, or any significant CAPEX.

                  A real life example. One of our best wells last year cost us about $15 to operate in 2014. It developed parted rods in 2014. The well work was almost 50% of the well’s total cost for the year. This year, we have had no failures, and the cost to operate the well is between $8 and $9.

                  Another real world example. We have a large (for us) water flood lease that will cost around $120K to operate annually, and will produce around 3,800 net barrels per year (after royalty). So OPEX should run about $31.50. But, one year the salt water injection pump wore out. Times were good, we replaced it at a cost of over $40,000. That added over $10 per barrel.

                  Look at Par shall field. About 10% of EOG’s wells show 0 or are SI in September. Could be for a variety of reasons, but maybe some wells aren’t economic now, or have down hole failures and they aren’t in a hurry to repair them.

                  One thing I hit on was the rush to drill wells as fast possible. I hope the vertical holes they are setting land speed records on are straight. We have problem wells, that aren’t straight, and they cost so much more to operate, due to rod wear, which causes down hole failures.

                  Another issue in the Bakken is super saturated salt water. I am sure this issue varies well to well, and flushing some with fresh water occurs more often than on others.

                  We have leases that produce very little total fluid, pumping units run slow, or on time clocks even. Those require little electricity, little chemical and little maintenance. An extreme example is a well that runs about 6 hours per day. It makes almost straight oil, we haul 1-2 loads of salt water off it per year. Not counting labor, it costs under $2000 per year to operate. It is in the same field and formation as wells which produce 1-2 barrels of oil and over 500 barrels of water per day.

                  A point I hope I am illustrating is that oil production carries great financial variability, and therefore great risk. Add in oil price instability, environmental concerns, etc. Murphy is quite alive in the industry, to quote Rune. So it has blown me away to see money spent on new wells with almost no chance of economic success, even if there are no unforeseen problems. But I have gotten used to it and grown, grudgingly, to accept it.

                  As for selling, everything has a price, but hate to sell at the bottom. But, again, we never know if we are at the bottom. It has long past gotten old, these low prices. But assuming we got what we wanted, what to do with the proceeds? Bank deposits? Stock market? Farmland, maybe, but it is generally still very high priced and grain prices are low.

                  • AlexS says:

                    shallow sand,

                    Was there any reduction in OPEX per barrel over the past year?
                    Is that possible to negotiate lower prices with your suppliers/contractors?

                    It seems that the shale firms were able to slightly reduce OPEX per barrel, but not by much. However capex per barrel was cut quite significantly, as they were able to squeeze profit margins of the drillers and frackers.

                  • Dennis Coyne says:

                    Hi Shallow Sand,

                    Thanks. So 14000*12+100000 is 268k and $35/b times 365 days is 12775 $-days/barrel. So $268,000/16,425 is 21 b/d, just to break even, maybe you would need 25 b/d for a nominal $50k profit.

                    My main point is that most Bakken wells are probably well above 25 b/d, so not very many wells are likely to be abandoned permanently.

                  • shallow sand says:

                    AlexS. There has been some OPEX reduction. Service companies have lowered rates, that is number one. Chemical companies were reluctant to lower, but they finally provided a little relief. Electricity, which is our highest of non-labor expenses, there is no relief, nor will there be.

                    There has been some horse trading with other operators and some cannibalization of idle equipment. More repairs than replacement. Less spent on gathering facilities, roads and locations. Well fees the same. Ad valorem (local taxes) still high as they are based on values as of 1/1/2014.

                    And, unfortunately, have cut labor to the bone. Many were laid off in January. August swoon brought another round.

                  • shallow sand says:

                    Dennis. I think, in the Bakken at least, operators will be allowed to temporarily abandon wells for a considerable period of time. ND seems to be the most operator friendly state. The issue with temporary abandonment will be with the lessor prior to the state of ND, based on my reading.

                    Also, in your calculation, don’t forget the royalty, which normally runs about 20%, and the 10% severance tax. Also, not sure about ND local tax. Also, not sure if all G & A is included in the $14K. Finally, of course, from a company viability standpoint, how do we pay back the initial investment, plus interest?

                  • Dennis Coyne says:

                    Hi Shallow sand,

                    The interest gets paid by the higher flowing wells which generate a lot of cash flow.

                    My thinking is this: A well has been drilled and is producing, the money spent is a sunk cost. Does it make sense to abandon a well that is producing 50 b/d or more or does it make sense to continue producing, assume the well is average in all respects (as every well is different)?

                    So let’s do the math.

                    Assume $35/b at the well head and 30% royalties and taxes so your net would be $24.50/b. Now assume average output for the year of 35 b/d and $14k/month OPEX plus $100k per year downhole maintenance for a total of 268k per year.
                    Revenue would be 24.5*365*35=$313k, so we would be ahead on this well by $45k for the year.

                    I am not in the oil business so perhaps this well would not be worth the time and effort and would be abandoned. What do you think?

                    If companies cannot function at these oil prices because they have too much debt, won’t the better wells be picked up by stronger companies (financially) as the weaker companies go bankrupt? That is the scenario I envision, others believe that thousands of oil wells will be permanently abandoned, that scenario seems unrealistic to me.

                    Maybe Enno already knows what percentage of Bakken/Three Forks wells (or all of North Dakota) produce less than 35 b/d (or 1000 b per month). It would also be interesting to know what percentage of total North Dakota output is from these low output wells.

                  • AlexS says:

                    shallow sand,

                    Thanks for the reply. You are my primary source of information on the U.S. onshore conventional oil sector.

                    I agree with you that 4Q15 is worse than 3Q15, and 2016 will be a difficult year. Still, I believe that in the second half of 2016 fundamentals will start to improve. The IEA and OPEC project a 1.2 mb/d annual increase in global demand, the EIA expects even more. Non-OPEC output is expected to decline by 0.6 mb/d (mostly from LTO). Saudi Arabia will not increase production. Healthy growth in Iraq is also unlikely next year.
                    Iran is the main threat, but I think it will not add more than 500-700 kb/d. Libya remains a black box, but there are to signs that situation is improving there. Same can be said about smaller producers, like Syria, Yemen and Sudan. Overall OPEC spare capacity is low.
                    Unfortunately, the current very high excess inventories will likely continue to increase until mid-2016, storage capacity is close to full in many regions, and we are already seeing fierce competition for the markets, with significant price discounts. However, from 2H16, demand will likely exceed supply, and the excess inventories will start to gradually decline.
                    As soon as early signs of improvement in fundamentals appear, the market will react and we will see higher oil prices.

                  • gwalke says:

                    Dennis,

                    In the dataset I have, which is still from August, of the 15041 wells in the file, 5866 (39%) had oil production of less than 50 b/d.

                  • Dennis Coyne says:

                    Hi gwalke,

                    Thanks.

                    Can you get the average output from those wells? I could assume 25 b/d, bit that is likely to be an overestimate (there are probably a bunch with no output).

                    Did you get the Eagle Ford data?

                  • gwalke says:

                    Dennis,

                    I got the data, many thanks for that.

                    Average output was 20.66 b/d for August for those wells.

                  • Dennis Coyne says:

                    Hi gwalke,

                    You’re welcome.

                    Thanks for that data. So if all 5866 wells were shut in that would cause a 121 kb/d drop in output. If we assume a similar number of wells with similar output were also shut in in the Eagle Ford and Permian basin we would have 360 kb/d less output from the 17,600 low output (50 kb/d or less) wells.

                    If we also assume no wells are completed in the Bakken, Eagle Ford and Permian basins after Sept 2015 that would cause another roughly 2100 kb/d drop in output for a grand total of 2460 kb/d from Sept 2015 to Dec 2016.

                    If we add the 275 kb/d drop in C+C output from April to August we get about a 2700 kb/d decline in US C+C from April 2015 to Dec 2016.

                    Does that scenario sound plausible to anyone?

                    I think it is very very highly unlikely.

              • oldfarmermac says:

                Precisely what is meant by the term “strips”? I get it that it is something accepted by many people as a good short term future price indicator, etc, and derived from oil market statistics in some fashion.

                Thanks in advance.

                • Dennis Coyne says:

                  Hi Old Farmer Mac,

                  I believe people are referring to the Futures strip.

                  So what is the price on an option which expires in Dec 2015, and Jan 2016, etc. The strip is this set of option prices for the future 5 or twelve months.

                  I usually use the website at the link below:

                  http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html

                  There are many others. The current futures strip for WTI is $40/b in Dec 2015, with prices increasing to $46/b in June and $48/b in Dec 2016.

            • Heinrich Leopold says:

              gwalke,

              You have met exactly the point what are the basics of a Ponzi scheme. The underlying business does not matter – if it is oil or if it is stamps or just hot air – as long as new cash comes in everything is ok. Problems arise when cash has to be paid out through redemptions or some operating or interest expenses are due. In the case of shale it is now the high operating cost, which is higher than revenue in many cases. How long can companies produce and burn cash? What is now also a limiting force for shale is that the expectation of higher oil prices is fading very quickly. This slows down the flow of new cash from investors.

              • gwalke says:

                Indeed, as we’ve seen, despite not savagely cutting the revolver to protect the money they already lent, lenders are more cautious and are often tying down assets through changing covenants. Wall Street has mainly looked at production and (manipulated) EUR figures – but now production can only fall, at least until January.

                So the banks have attempted to positioned themselves at the front of the queue in case of bankruptcy, and have not extended enough credit to allow production to grow. Problems on the horizon…

      • AlexS says:

        I agree with Dennis,

        It makes sense to look at productivity of new wells. Total wells productivity depends on the number of new wells drilled

  10. Carl says:

    The better question to ask about Russian production is what do they export? When will they run out of hard currency? When will Russia attack the Gwar field? Will Putin allow the US and Saudi Arabia to replicate the economic war that successfully bankrupted the former Soviet Union. I do not believe Russia is in Syria to maintain $40 oil. I also do not believe Putin’s response to this economic war will be the same as 1986.

    • AlexS says:

      “The better question to ask about Russian production is what do they export?

      If you mean what liquid hydrocarbons is Russia exporting, here is a chart (in million tons):

    • AlexS says:

      “When will they run out of hard currency?”

      Russian foreign currency and gold reserves sank from $510 billion in January 2014 to a low of $350 billion in April 2015 due to tumbling oil prices, weaker euro against the dollar (shrinking the portion held in that currency), high foreign debt repayments by the Russian corporate and banking sector, and sanctions that locked out Russian companies of western capital markets.
      Since then, thanks to flexible foreign exchange policy and lower foreign debt repayments the Central Bank was able to
      slightly replenish its holdings, which were at $366 billion as of November 6.

      As regards the near to medium term future, note that:
      1) Russia’s corporate and banking sector’s foreign debt maturities peaked in 2014-early 2015, were much lower in the second half of this year, and are even lower in 2016;
      2) Russian government’s foreign debt as percent of GDP is one of the lowest;
      3) Despite a significant drop in export revenues, imports declined even more, so Russia currently has current account surplus;
      4) Capital flight this year is lower than expected and much lower than in 2014;
      5) The decline of Russia’s GDP bottomed out in 2Q15 and started to moderate from 3Q15. Exporters and local companies competing with imports are benefitting from weaker rouble.

      In general, the macroeconomic situation is not good, but far from critical and there are signs of improvement.

      Russia’s foreign currency and gold reserves (USD billion)
      Source: Central Bank of Russia

    • AlexS says:

      – “When will Russia attack the Gwa[ha]r field?

      It must be a joke?

      – “Will Putin allow the US and Saudi Arabia to replicate the economic war that successfully bankrupted the former Soviet Union.”

      It was not the the US and Saudi Arabia’s economic war, but Gorbachov’s stupid policies’ that bankrupted the former Soviet Union. In the past, Russia and the Soviet Union had survived much worse situations than the 1986 drop in oil prices.

      – “I do not believe Russia is in Syria to maintain $40 oil. ”

      This has nothing to do with oil prices

      – “I also do not believe Putin’s response to this economic war will be the same as 1986.”

      I agree

      • Carl says:

        AlexS,

        If you read Donald Regan’s book and talk to Don Hodell – Secretary of Energy a coordinated plan was developed by William Casey to flood the oil markets in 1986. This is fact, not fiction. The prolonged price drop was coordinated by the Reagan Administration with the Saudi leadership and expedited the financial demise of the Soviet Union. It also demolished the oil industry and gave the OPEC countries total control of the oil markets until the recent Canadian Oil Sand ramp up and the US Shale Boom. Does the current situation sound familiar? The current prolonged price drop brought Iran to the bargaining table and Russia became more amenable to discussion’s on the Ukraine.

        Russia would not directly attack Gwahar. Russia weapons would be used(Currently in Syria) and ISIS or Iran would get the blame. Wars in the Middle East are expensive.

        Gorbachov’s policy’s were stupid and Putin’s are scary!

        If Russia is not in the Middle East to control the oil reserves, why are they in Syria? Human rights and suffering?

  11. Doug Leighton says:

    I realize these two articles may be another lie designed and put together by scientists for the sole purpose of alarming us but it’s all I have to go on at the moment.

    EARTH’S HIDDEN GROUNDWATER MAPPED: LESS THAN SIX PER CENT RENEWABLE WITHIN A HUMAN LIFETIME

    “Since we now know how much groundwater is being depleted and how much there is, we will be able to estimate how long until we run out.”

    http://www.sciencedaily.com/releases/2015/11/151116120608.htm

    EARTH’S CLIMATE MORE SENSITIVE TO CARBON DIOXIDE THAN PREVIOUSLY THOUGHT

    “Ancient climates on Earth may have been more sensitive to carbon dioxide than was previously thought, according to new research. Scientists examined nahcolite crystals found in Colorado’s Green River Formation, formed 50 million years old during a hothouse climate. They found that carbon dioxide levels during this time may have been as low as 680 parts per million (ppm), nearly half the 1,125 ppm predicted by previous experiments. The new data suggests that past predictions significantly underestimate the impact of greenhouse warming and that Earth’s climate may be more sensitive to increased carbon dioxide than was once thought.”

    http://www.sciencedaily.com/releases/2015/11/151116112706.htm

    • Javier says:

      Not necessarily.

      The first study actually addresses a real problem. The depletion of aquifers is one of the most serious problems affecting the availability of water for many millions of people and agriculture. I think they go a little too far when they say that we now “know” how much water there is underground. I mean, this is a forum about fossil fuels and everybody hear knows that our info on oil reserves underground is much better than our info on underground water, and we don’t know how much there is. We have had estimates for decades and the estimates have been changing significantly, so coming here to say that we “know” how much water there is underground is not going to convince many.

      Their numbers are a first estimate, and their proposal that only a 6% can be renewed in a human lifetime has to be taken with a grain of salt. However it is clear that we are consuming aquifers a lot faster than they can replenish. In fact we are getting so much water out of the ground as to cause subsidence in some urban coastal areas increasing the effect of sea level raise. We will put the blame on global warming, of course.

      The second article, the data is probably correct but the interpretation is speculative and over-hyped. We have no idea if those critters incorporated carbonates at the same rate under an atmosphere with 10 times more CO2. There are several alternative explanations for the data, but it is going to be cold next week in Paris, so they are trying to warm the attendees with alarming press releases. Studies based on observational data to determine climate sensitivity indicate that the climate is less sensitive to CO2 than previously thought, not more.

    • It’s more bs. That Eocene warm period had different continent locations, inland seas, different ocean currents and atmospheric circulation. It’s part of the Paris propaganda publication program.

  12. RHall says:

    Interesting read on the financialization and boom bust of oil from Chris Cook:
    http://en.trend.az/business/energy/2456914.html

  13. Political Economist says:

    According to NASA data, October 2015 was 1.04 degrees Celcius warmer than the 1951-1980 average

    This the highest monthly index (not temperature) on record

    This year is set to be the warmest on record

    http://data.giss.nasa.gov/gistemp/tabledata_v3/GLB.Ts+dSST.txt

    • -(Ralph)- says:

      So whenever I walk in to see science like this I have to ask myself why in the world is the reported temperature change being compared to the years 1951-1980??? What was so special about that particular time interval versus for instance reporting the temperature change in relation to the last 18 years where global temperatures have held mostly steady during that time interval according to the same data the scientists use at http://www.woodfortrees.org/plot/rss/from:1997.15/plot/rss/from:1997.15/trend/plot/esrl-co2/from:1997.15/offset:-370/scale:0.08/mean:12.

      The only thing that stands out is the 1970’s were an extremely cold period–there are probably many too young people here, but if you are old enough to have lived through the 1970’s, you will definitely remember how the news magazines & journalists back then like the great Walter Cronkite were reporting on the scientific predictions of a quick ice age beginning in the 1970’s because it was just so dang cold out. I’ve lived in Michigan my entire life & I still remember some of the winters of the 1970’s I think like 1977, 1978, 1979 being so brutally cold & having much more snow than I can ever remember before or since. I was out of school then but it would have been painful walking each day in the windchills of 50+ below zero. Makes me shiver just remembering those days but the point is it looks like scientists are trying to be deceptive when they report our current temperatures compared to a special period that was known to be much colder than the average. Of course in those kinds of comparisons the current temperatures are going to be much warmer, but what good is that really to know when we don’t even need to do the calculations to figure out the 1970’s period was much colder than today?

      The other point I think alot of the scientists would do well just to relax rather than try to scare us old guys about a crisis, when we’ve all already been around the block many times before & have seen crisis come & go many times back & forth through our life. The way I think about it, the planet’s about 4.5 billion years old, there’s been better but there’s been worse. All we can do is sit back & observe what the climate wants to do, try to go about our lives & give our families the best & most comfortable lives they can have.

      Ralph,
      Cass Tech ’64

    • Javier says:

      This year is set to be the warmest on record

      And there is a very good reason for that. We have a very strong El Niño condition, the strongest in 17 years. It will likely be very warm until the middle of the spring. We will see what happens afterwards, because very often strong El Niño conditions are followed by La Niña conditions that turn the warming into cooling.

    • I made a 10 bolivar bet, that El Niño will peak on December 3, 2015.

  14. Gemma says:

    It’s November now already! So looking back over 2015, is 2015 the Year of Peak Oil or not? That’s what I want to know!!!

    • Donn Hewes says:

      Hard to say. Give it about five to ten years and we will likely know.

    • Dennis Coyne says:

      Hi Gemma,

      2015 may well be a peak year in C+C output, when oil prices rise it will likely be surpassed, maybe around 2018, it depends on many factors such as growth in world GDP and the price of oil, along with the size of the oil resource. The peak will likely be between 2017 and 2025 in my view. It may take another 5 years after the peak before it is widely agreed upon.

  15. R Walter says:

    What happened to Ernst Haeckel, his wrong science, not all wrong, questionable philosophy, and how it was all used, got used.

    http://www.ucmp.berkeley.edu/history/haeckel.html

    “Ernst Haeckel, much like Herbert Spencer, was always quotable, even when wrong. Although best known for the famous statement “ontogeny recapitulates phylogeny”, he also coined many words commonly used by biologists today, such as phylum, phylogeny, and ecology. On the other hand, Haeckel also stated that “politics is applied biology”, a quote used by Nazi propagandists. The Nazi party, rather unfortunately, used not only Haeckel’s quotes, but also Haeckel’s justifications for racism, nationalism and social darwinism.”

    http://www.ucmp.berkeley.edu/history/haeckel.html

    “Politics is applied biology.” – Ernst Haeckel

    As wrong as the statement is, it seems as though it is correct, yet unacceptable.

    Science, not always right, does in fact contribute to lies and propaganda.

    Witnessing it all in the real world out there right now in real time, seems that way.

    • Glenn Stehle says:

      R Walter said:

      Science, not always right, does in fact contribute to lies and propaganda.

      Yep. With the advent of Modernism in the first decades of the 17th century, it took the Catholic church about a New York minute to catch onto the new rules of the game:

      One thing about [Descartes’] ideas, however, was to [the Catholic theologians’] taste: his insistence on the need for certainty. Once rationalism raised the intellecutal stakes, Catholics could not go on playing by older, more relaxed rules: if formal rigor were the order of the day in physics and ethics, theology must follow suit. Confronting Protestant heretics on the one side, and skeptical deists on the other, the theologians decided: “If we can’t join them, let us beat them at their own game.”

      In the Library of the Covenent of Ste. Genevieve, near the Pantheon in Paris, is a manuscript entilted Traite sur l’autorité et de la réception du Concile de Trente en France. It describes the stuggle, after the Council of Trent, to uproot the “pernicious heresies and errors” of Protestantism, and paints a revealing picture of the intellectual position of the Catholic Church in early 18th-century France… [I]ts final pages show how far the demand for “undeniable foundations” had made its way into Catholic theology by 1725… The ambition of the Counter-Reformation, it tells us, was “to prove invincibly our most fundamental belief.”

      Montaigne’s reaction to these claims can be imagined; yet neither Aquinas nor Erasmus would have been happy about this use of the phrase, “invincible proof.” Neither of them claimed that human beings, however wise and inspired, could put matters of faith and doctrine beyond scope of reconsideration and revision. Both of them would be shocked to see that the Christianity they treasured was abandoning its former sense of human finitude, and falling into a dogmatism contrary to human nature as they knew it. Despite all its turmoil and religious divisions, the 16th century had been, by comparison, a time when the voice of sweet reasonableness made itself heard, and was widely valued. From 1610 on, and most of all after 1618, the argument became active, bloody, and strident. Everyone now talked at the top of his voice, and the humanists’ quiet discussions of finitude, and the need for toleration, no longer won a hearing. In the circumstances, the best that “men of reason” could do was outshout the theological dogmatists, and find a way of beating them at the game of “invincibly proving” their fundamental beliefs.

      –Stephen Toulmin, Cosmopolis

  16. AlexS says:

    Horizontal well completions in the Eagle Ford and Permian basin
    Source: https://btuanalytics.com/completion-trends-in-the-eagle-ford-and-permian/

    • Dennis Coyne says:

      Hi AlexS,

      The problem with this data is we don’t know the oil/gas split on the completions. I suppose we could use rig counts as a proxy with a 5 month lag, but it would be nice if they showed the split between oil wells and gas wells.

      • AlexS says:

        Yes, Dennis. Oil/gas wells split is not important for the Bakken and the Permian, where the share of oil rigs is close to 100%, but rather important for the EFS, where it fluctuates.

        Oil rigs as percent of total rig count in the Eagle Ford and Permian basin

        • Dennis Coyne says:

          Yes AlexS, I agree, this only matters for the Eagle Ford, for the Permian Basin and Bakken, horizontal completions should be enough information. For the Eagle Ford I am not sure the oil rig count and horizontal completions would be enough information, there is also the wells connected information which is interesting and probably the best metric to use combined with rig count 6 months earlier.

  17. AlexS says:

    Average proppant use per well

  18. AlexS says:

    Horizontal wells drilled, completed and connected to sales in the Eagle Ford

    Note that, according to this chart, well completion does not mean that it is immidiately starting production.
    This is an umportante nuance that most analysts ignore in their models of LTO production

    • Dennis Coyne says:

      Hi AlexS,

      You are correct, I don’t have access to that data, and again the data does not tell us which wells are gas wells and which are oil wells so we would have to assume the ratio is proportional to rig counts with a lag. Looking at the chart there seems to be a three month lag from drilling to completion, but the completions to sales divergence is not something I had seen before.

      Nice work, as usual. Thank you.

      • AlexS says:

        Dennis,
        not only you and other people posting here, but, I’m sure, most analysts and experts with significant research budgets and access to DrillinInfo and similar databases do not take into account many important factors that affect shale oil output.
        Even if we know historical statistics on wells drilled, completed and their first production, it is difficult to predict how all these numbers will evolve in the future.
        And it is impossible to predict how companies will be using refracs, or suddenly shutting down producing wells for several months, etc.

        • coffeeguyzz says:

          Alex

          Thanks, as always, for your contributions to this site.

          Your post may be one of the more profound ever published on POB as it gets to the heart of what I have seen and, when possible, noted.

          These guys are choking back, they are getting far more productive, the ‘halo effect’ is being recognized and utilized in well production and design. Innovation continues at a torrid pace.
          One example of the latter is fracturing that is utilizing ‘diversions’ along with slickwater. I’ve not yet uncovered the specifics, (Felix Energy alludes to it in their latest presentation … 70 stage fractures with a ton/foot proppant), but it may well be a variation of the ‘diverting agents’ put forth by companies to assist in re-fracs. These fibers/balls/gizmos momentarily plug new fissures allowing pressure build up to create more new ones.

          This is a non stop, highly dynamic field that shows little signs of abating.

          • AlexS says:

            Thanks coffeeguyzz.

            I agree with you that the shale industry is still at the early stage of development and a lot can be done in terms of technology and improvements in productivity.
            That said, I want to note that numerous unknown and unpredictable factors may work in the opposite direction as well.

            • Enno says:

              Excellent charts and comments Alex, thanks.

            • I can’t think of anything major we can invent. But if I come up with something I’ll patent it. I’m trying to figure out a water rejection hyper magnet. 🐸

              • Wake says:

                Maybe you could figure out how to shove a few tons of divining rods down the hole, but backward ?

                Call me if it works

              • AlexS says:

                Fernando, sometimes minor and gradual, but constant changes in technology may have a significant effect. And long-known technologies can be applied in new areas.
                Hydraulic fracturing and horizontal drilling were known for decades before they were used in shale developments.
                Who knows, maybe CO2 EOR or something else will help to increase oil recovery rate in shale formations from 6% to 10-12%.
                Time will tell.

            • Dennis Coyne says:

              Hi AlexS,

              Have you looked at Enno’s charts for the Bakken/Three Forks?

              The average well profile has been pretty consistent since 2008, that’s 7 years, with a small bump in the first 12 months of output in 2013 and 2014 and stable (at 2014 average levels) in 2015. Some of the industry experts have explained that the rising GOR may indicate that the newer wells could decline more quickly than the older (2008 to 2012) wells so that the overall increase in EUR might amount to 20 kb (out of 330 kb for the average 2008-2012 well), so about a 6% increase in output. Many of the innovations to increase output (more frack stages and more sand) raise well costs by about 20%.

              Basically we have technological innovation attempting to overcome depletion, I think you know who wins this battle every time.

          • Dennis Coyne says:

            Hi Coffeguyz,

            The problem is that these innovations push the well cost higher. So far there is very little evidence that the average well profile in the Bakken has been changed significantly by these innovations. When I see it in the data I will believe it, I don’t put a lot of faith in investor presentations.

            • coffeeguyzz says:

              Dennis

              I have refrained from being more specific regarding the output of newer wells until I can access the data via the subscription service from ND DMR.
              The fifty bucks/year isn’t holding me back as much as the time involved in examining these wells.
              From seeing this data on several other sites, the monthly output on , literally, dozens of wells have clearly been influenced both by fewer days online and irregular production numbers that could only happen by deliberately restricting output.

              Rune Likvern has posted a vintage production chart for Slawson that indisputably displays this.
              When I am able to offer up this info, I will gladly do so.
              Meantime, if any reader/analyzer is so inclined, getting the basic ND DMR subscription and going back over individual confidential wells starting 10 months ago will show several examples of what I am describing. (Checking out the Slawson chart should prove production manipulation also).

              • Dennis Coyne says:

                Hi Coffeguyz,

                I only have access to the free data. If you are correct, high oil prices should correct the problem, as generally oil companies prefer to produce a well as fast as possible without damaging the well.

                Enno has said the days of production data is not very reliable.

        • Dennis Coyne says:

          Hi AlexS,

          Yes predicting the future is indeed difficult, if we assume the average behavior of the past extends into the future for a year or two we might be fairly close to correct. Long term forecasts can create alternative scenarios to try to bracket the possibilities and then average the high an low scenarios as a more likely outcome, but they are clearly just guesses.

  19. Watcher says:

    August this year

    http://www.wsj.com/articles/why-chinas-thirst-for-oil-cant-lift-prices-1440574814

    The country’s crude imports jumped 22% in July compared with a year ago, to 7.25 million barrels a day, according to customs data. That sort of surge might prove unsustainable, but China’s oil imports could still rise by over 7% this year, according to Citi Research.

    http://www.bloomberg.com/news/articles/2015-09-29/jefferies-china-s-demand-for-oil-is-totally-misunderstood-by-the-market

    Yu’s team has grown more than a little sick of reports linking weakness in crude oil prices to softening economic data in China. There’s one big problem with this narrative, according to the analysts: Chinese oil demand is actually quite robust, up 9.2 percent year-over-year, as of August.

    Imagine that.

    • Watcher says:

      Oh look! It’s not spam.

    • Glenn Stehle says:

      Watcher said:

      The country’s crude imports jumped 22% in July compared with a year ago, to 7.25 million barrels a day, according to customs data.

      Hum. It sounds like the anti-carbon crowd isn’t having much success in the battle to win friends and influence people.

      • AlexS says:

        The Chinese are replenishing their strategic and commercial oil reserves at time of low oil prices. But the underlying consumption also keeps growing

        • Watcher says:

          And causing lower oil prices!

          Imagine that.

          • Dennis Coyne says:

            Hi Watcher,

            Chinese demand can increase while demand in other areas decreases as it is a World market. Also the fall is a time when refineries shut down for maintenance, oil in storage increases, and prices decrease, it happens most years. The IEA shows world output being flat from August to September, and price may have decreased due to worries over too much supply when Iran starts ramping up production and because US output is falling more slowly than some have predicted.

            At some point the excess oil in storage will decrease and oil prices will increase. I will leave it to you to predict when that might occur. No doubt you will claim that oil will remain under $50/b forever.

            • Watcher says:

              Prove it.

            • Dennis, I have no idea what oil prices will do but I can only say I am not nearly as optimistic as you. I see the economy playing a far bigger part in this drama than you seem to believe.

              The Chinese economy is shaky and things are going downhill fast there. The Chinese economy getting worse will, very likely, keep a cap on oil prices.

              My best guess is that oil production will keep falling and the price of WTI will not recover above $50 for years… if ever. Sick economies around the world will keep demand and prices down for the foreseeable future. This is only a wild ass guess however. I could very well be wrong here and the economy recovers and prices could soar. I just think the recovery scenario has a lower probability than the sick economy scenario.

              Of course that is just my opinion. Things could improve in the future. But I just don’t see that happening. We are very likely well past peak economy right now. The downhill slide of the economy is the primary cause of falling demand and falling oil prices.

              • Dennis Coyne says:

                Hi Ron,

                IMF expects World growth at 3.3% in 2015 and 3.8% in 2016, 2014 was 3.4%.

                http://www.imf.org/external/pubs/ft/weo/2015/update/02/

                Kopits expects oil prices to rise

                http://www.cnbc.com/2015/11/13/

                Though he predicted this in Feb 2015 for late 2015 and has been wrong.

                • Dennis, if I knew what the price of oil would do I would invest in futures and clean up. I could be a millionaire in short order. So could Kopits, or anyone else for that matter.

                  There are futures traders out there, gamblers would be a better term, who are trying to figure out what the price of oil and other commodities is going to do. Half of them will be wrong and the other half will be right… this time. Next time it will likely be a different story.

                  The IMF have a chance of being right… and a chance of being wrong.

                  All that being said I have been watching the Chinese economy pretty close. It looks like the bubble is about to pop. Others of course are predicting that the Chinese economy will continue to grow at about 7% per year on into infinity.

                  Those people are of course wrong… dead wrong. But just when the bubble will pop is uncertain. But I think it has already started. The air is just coming out a bit slower than we expected. So as a result a lot of people don’t see any downturn at all. They are mistaken. Or at least that is my opinion.

                  Good article: Is China Cooking the Books on Economic Expansion?

                  “We don’t have total confidence in the numbers, and we are surprised by the acceleration in services output given the collapse in the equity market,” a team of Bloomberg economists wrote in a research note at the time.

                  • Dennis Coyne says:

                    Hi Ron,

                    There is a lot of room between 0% and 7% growth in China. I expect Chinese growth will slow down, but their main problem right now is an overvalued currency, they should have devalued their currency in line with Japan, Korea and Europe. I have not been following China very closely so perhaps you are right.

                    It would be interesting to get Political Economist’s take on China’s prospects over the next 2 to 3 years, my guess is that he may follow China as closely as you.

                • Heinrich Leopold says:

                  Dennis,

                  The oil price can only rise when US production will fall by at least 2 mill bbl/d. The sooner US production falls the earlier the oil price would rise. Saudi Arabia simply cannot cut as they then lose market share. US companies could also sit out and wait until low cost producers run out of capacity, yet this will take years and I doubt US companies have the cash to sustain it.

              • AlexS says:

                Global oil demand growth: most recent estimates by IEA, EIA and OPEC (mb/d)

              • shallow sand says:

                Ron, if WTI stays below $50 for several years, there should be a massive US LTO high yield bond default. A ton of that junk comes due between 2018-2022. Of course, the finance people will figure out a way to extend and pretend. OPEC should be aware of this by now.

                I still think OPEC will cut production significantly at some point. OPEC countries are staring at significant financial peril. Many are there now. There would be a cut 12/4/15. However, KSA and their Gulf neighbors were pretty smug on Thanksgiving, 2014 when they refused to cut. They have to save face.

                KSA did not understand how US shale works then (I did not either at that time).

                Now that they do know that much of US shale is a financial sham, they should cut and let US shale play itself out. But I think Gulf OPEC will have to lose a lot more money before they will admit they were wrong. It is tough for most people to admit they were wrong, particularly those in power.

                I admit I was dead wrong. I thought $60-65 WTI would pretty much kill shale drilling and completions off. But my mistake was the same one as Gulf OPEC’s. I did not understand the financial side of LTO.

                Ultimately, neither the US government nor populace, outside those in the industry, give a crap about any of this. Gasoline is $1.79. To 99.5% of the country, that is AWESOME.

                Furthermore, I will take Russia over Gulf OPEC any day as to who will survive. Russia is a heck of a lot more diverse economically than Gulf OPEC, and they do not have the same demographic challenges.

                OPEC needs to wake up pretty quickly. Not cutting is hurting them a heck of a lot more than any damage they are doing to US shale or Russia, IMO. But if Gulf OPEC wants deplete their reserves and destroy their weaker member countries, that is their right.

                • Dennis Coyne says:

                  Hi Shallow sand,

                  If the bonds implode in the LTO plays, won’t the majors just swoop in and pick up some assets on the cheap. There are some who believe that thousands of LTO wells will be abandoned, for wells producing 20 b/d or more, I would think the revenue would cover the OPEX with a little profit left over even at $45/b, no? Though I suppose it depends on the price the well is purchased for, I am sure the majors can run those numbers so the wells would turn a profit.

                  • shallow sand says:

                    Dennis, more than likely smaller firms will pick up the low volume shale wells. Not necessarily mom and pop types, but companies like Citation, etc.

                    Majors will only be interested in areas that have a high return probability. So areas with sweet spots yet to be fully exploited. Those areas probably will not go through a BK.

                  • Dennis Coyne says:

                    Hi shallow sands,

                    Thanks. Are a lot of vertical wells being temporarily abandoned at these prices?

                    I think you said about 5% of your wells were shut in temporarily, would you think that is typical? What is the average daily output of the shut in wells (roughly)?

              • Greenbub says:

                “oil production will keep falling and the price of WTI will not recover above $50 for years… if ever.”

                Ron, that is an extremely pessimistic outlook. Are people all around the world going to garage their cars and go back to horses?

                • Greenbub, I can only quote Montaigne: “All I say is by way of discourse, and nothing by way of advice. I should not speak so boldly if it were my due to be believed.”

                  • Greenbub says:

                    In that case, maybe I will try to get ahead off the game and see if the “Buggywhips.com” domain name is available.

                  • Dennis Coyne says:

                    Hi Ron,

                    You have to be careful because people listen to what you have to say.

                    Everyone knows enough to ignore me 🙂

                  • Dennis, I have said many times that I have no idea what oil prices will do. However I am entitled to a wild ass guess. And that’s all that was and I so stated as much.

                  • Dennis Coyne says:

                    Hi Ron,

                    I was joking.

                    I agree that you have said repeatedly you don’t know what will happen to oil prices, and of course nobody does.

                    I looked back at your comment and you called it “my best guess”.

                    You also said you have no idea what oil prices will be in the future, or something to that effect, at the beginning of the comment.

                    I actually missed the part about it being a WAG, as it came after.

                    Interesting that, when you respect someone, you ignore the part about WAGs (believing the person is just being modest maybe).

                    I read your comment three times before seeing the WAG part and I only saw it because I was convinced that you implied that it was a WAG. I was wrong again.

                    Just some food for thought, people might not see the WAG part of your comments.

        • Nick G says:

          Do we have any data on how much the Chinese are putting into reserves?

        • Synapsid says:

          AlexS,

          China has been refining a fair part of that imported oil and exporting the products. She went on a spree building refineries and is using them.

          That, and Saudi Arabia’s taking part in downstream JVs, have been having an effect on the global market for refined products, I should think. How are prices?

      • Nick G says:

        I like carbon. Last I checked, I was mostly made out of carbon.

        Fossil fuels, on the other hand, have mostly outlived their usefulness. They’re risky, polluting and much more expensive than the market price would indicate. Look at our M.E. involvement, the $trillions lost, the hundreds of thousands of lives lost in oil wars (including the lives of those who live there, of course), the many thousands of soldiers killed or disabled.

        I think most people here agree that FF is unsustainable, and that we should move away from it ASAP.

        I’d say the chinese leadership agrees, though they don’t feel they have the power to move the country faster than they are, due to the need to reduce the risk of revolutionary unemployed young men, a danger we’re seeing graphically in the M.E. right now.

        I kind’ve think you do too.

        • Those aren’t really oil wars. It’s more about. Israel vs Palestine. Helping Israel hobbles USA foreign policy, gets the USA into all sorts of hassles.

          • Nick G says:

            The whole world joined in the 1990 oil war against Iraq. Everyone was defending an autocratic monarchy, in an artificial country.

            It was an oil war, and it wouldn’t have happened if there were no oil in the M.E.

            Heck, would Israel have happened if there were no oil in the M.E.? Remember, the UK only helped create Israel (beginning with the Mandate) after they became hopelessly dependent on Iranian oil.

        • R Walter says:

          Iowa is 310 miles in distance from border to border, east to west. There is a truck every tenth mile on I-80, on the average, 528 feet apart; at any given time, there will be 3000 trucks heading to Chicago. Just a wag, probably the same number heading back to the west coast in that same distance. Omaha is Warren’s place of business for a reason. Trains are rolling, you name it, they’re hauling it.

          Without those fossil fuels, you will find out what is unsustainable.

          You forget how that carbon gets there.

          Officially a Fossil Fuel Denier. har

          • Nick G says:

            I know you’re joking, but some people won’t, so I’ll answer:

            Warren Buffet owns a lot of trains, too, and they use 1/3 as much energy per mile.

            And, of course trains mostly use electric motors, and that electricity can come from power lines instead of onboard diesel generators. In the long run, that would be far cheaper.

            Just for fun, I’ll mention that trains could be powered by solar panels on top of the containers they’re hauling. That would be cheaper too, and wouldn’t require much infrastructure.

            • Wake says:

              What would those panels power exactly? The light on the front of the train coming at you?

            • Bob Nickson says:

              A 40′ intermodal container can fit (14) solar panels laid flat (zero degrees tilt) on top. Assuming 330 watt panels, this would produce an estimated yearly average of 6MWh’s at 40 degrees latitude.

              According to Wiki, U.S. rail freight efficiency is 289BTU’s per short ton mile, so if I did the math right, 6MWh’s would move 1 short ton a distance of 70,840 miles, or about 154,000 pounds from Denver to Chicago once.

              • Nick G says:

                hmm. Seen any stats on the average tonnage carried by a 40′ container? Or average miles per year per container?

                • Bob Nickson says:

                  No, but I did find a Bureau of Transportation document saying that in 2002 16 billion tons of materials and cargo were moved 5 trillion ton miles.

                  !

                  I also found a source saying that freight rail TonMPG is 476.

                  That’s rather interesting as 5 trillion ton miles at 476TMPG is 10,504,201,680 gallons of diesel costing $26.26 million at $2.50/gl.

                  Compare with $2.07 million for the 17.3GWh’s equivalent at $0.13/kWh.

                  Could that possibly be right?

                  According to http://reasonrail.blogspot.com/2012/05/why-freight-will-never-electrify.html , no. The cost difference is much higher.

                  He’s claiming that Union Pacific alone spent $3.5 billion for fuel in 2011, and could have saved $2B if electrified.

                  Interesting.

                  He also claims that cost to electrify rail is $5.5M per mile, which at 144,000 miles of freight rail in the U.S. is $792B.

                  He also claims high costs for purchasing a new electric locomotive fleet, but does not provide a number, and oddly does not acknowledge that they are already electric traction powered by a diesel generator.

                  Doesn’t seem that difficult to convert them to swap from catenary power to diesel at whim.

                  • Bob Nickson says:

                    Sorry, was distracted while posting.

                    Make that $26 billion and $2 billion.

                    Don’t typically deal with that many zero’s while balancing my checkbook.

              • Toolpush says:

                Bob,

                Don’t forget, the US railroads like to double stack and are spending billions on refurbishing old tunnels and bridges to expand the idea. Therefore you need halve the produced solar energy per container!

                • Bob Nickson says:

                  I really can’t imagine why you would ever actually mount the panels on the trains themselves, and certainly not on containers unless they’ve been turned into a house first, which also makes no sense to me.

                  Simply by tilting the panels to 33 degrees you’d increase the yearly output by a MWh.

                  • Nick G says:

                    PV on commercial vehicles (like trains) makes sense because:

                    They’re powered by diesel, which is about 4x as expensive for transportation as Industrial/Commercial electricity (and potentially PV could be even cheaper than IC power, as discussed below);

                    Electricity is a pain to provide to vehicles, and require infrastructure for either charging (batteries and charging stations), or electrification of the track;

                    Commercial vehicles are out in the sun the great majority of the time, unlike passenger vehicles;

                    Vehicles are manufactured in a plant, which could make adding PV much cheaper than field or rooftop installation – the installation and Balance of System costs (which are much larger than panel costs, these days) could potentially be almost entirely eliminated. PV panels cost about $.50Wp these days, which could produce power for about 2.5 cents per kWh, if installation and BOS costs could be eliminated.

                    Trains are already electric, so all you need to do is install and connect the panels.

                    Cheap PV is so new, that it’s possible uses haven’t really been thought through by legacy players like rail, aviation, trucking, water shipping, etc.

                • Nick G says:

                  Don’t forget, doublestacking is going to reduce the energy required per ton-mile.

                  Drive train losses would stay the same. Friction losses won’t increase much. Acceleration/braking losses would be proportional to overall weight, but electrification open the door to regenerative braking, which would mostly eliminate this loss.

                  Trains really haven’t worked very hard on aerodynamics, because until now they haven’t needed to…

                  • Bob Nickson says:

                    It seems problematic.

                    The containers don’t stay with the train, so there would need to be a PV roof above the double stacked containers which would add height and interfere with loading and unloading. There would need to be PV lids over the coal cars 😉

                    Why would you not electrify the rail line? Then it doesn’t matter where the panels are, and 100% of the power needs of the train can be electric rather than just whatever fractional amount the surface can provide if they happen to be rolling in the day during sunny conditions.

                  • ChiefEngineer says:

                    Hi Nick,

                    I’m with Bob seeing PV on containers and trains as problematic.

                    I think the low hanging fruit would be to electrify the most used 10k to 20k of rail miles.

              • coffeeguyzz says:

                Push

                Over on Bruce Oksol’s blog – the million dollar way – he posted a fascinating snippet from a well’s file – Statoil’s Skarston 1-12 XEH – that described both inter-well communication and enormous gas shows.
                As there has been speculation concerning the increased GOR in newer wells, do you think you can check out that report and give us your professional opinion?

                • John S says:

                  Coffee, can you post a link to the statoil well?

                  Thanks

                  • coffeeguyzz says:

                    John

                    I’m fairly inept at getting the little blue letters on the screen, but the site is ‘the million dollar way.blogspot.com.
                    The article was from yesterday, Nov. 17, titled ‘Well communication’.

                    The site’s owner, Bruce Oksol, is a native of Williston, retired military, who started the site years ago in an attempt to both chronicle and understand the ‘All Bidness’.
                    It is a treasure trove of info about the Bakken in particular and the shale ‘revolution’ in general.

                • Toolpush says:

                  Coffee,

                  http://themilliondollarway.blogspot.com.au/search?updated-max=2015-11-17T16:08:00-06:00&max-results=10

                  On a quick look at the details, it goes more to prove that the close spacing of wells in the Bakken is fraught with danger. It appears the increased gas in the MB well is caused by communication with the close by and deeper, Three Forks well.
                  The most likely reason for the abnormal mud weight required, is that there was no mud acting on the TF formation from the MB down.
                  I would say it has been shut in due this communication, effecting the production in the TF well/s.
                  Remember the Oasis blow out? Communication between wells!
                  As the oil companies continue to drill closer spaced wells, these problems will only increase in number.

                  • coffeeguyzz says:

                    Push

                    Thanks for checking and responding.
                    I think there will be a whole lotta learning going on with all these shale plays as this down spacing continues. The Eagle Ford guys are putting laterals close enough so they can practically shake hands, no kidding. Apparently the thickness in certain areas is prompting extremely close placement of wellbores.

                    In the southwest Marcellus, the extremely low decline rate of many wells is thought to be because the shallower Upper Devonian formations (Rhinestreet?) Is barely 50′ above the Marcellus and the frac’d are actually accessing both formations.

                    I just came across the fact that several operators have been including ‘diversionary’ proppant in their frac’d formula and this is allowing far more fractures to occur in a more tightly controlled space.
                    EOG now claims something like 4,000 fracture events per specified space whereas a year or do back they only got 550.

                    Interesting times.

                    Thanks again.

                  • Toolpush says:

                    Coffee,

                    Just to add a point about the communication between wells. The fractures that caused the communication would have been from the older deeper well, working their way up, and the newer MB well just happened to drill these old fractures, allowing the communication. They may very well have much improved fraccing techniques these days, but they still have the legacy of their previous drilling and fraccing practices to deal with.
                    There will be a few surprises to come, especially as drilling times are becoming so critical, and everyone will be drilling at extremely fast rates op perpetration. I was surprised at the 35ft per hour, We know this was partly a result of the higher mud weight, but I would I would have expected 350ft per hour rates plus, at the rate they are suppose to drilling these wells!

        • wimbi says:

          Hm. Lotsa young men not doing anything useful.

          Lotsa need for something to replace FF’s

          Lots and lotsa sun, pretty near everywhere except in the minds of the ff magnates.

          Somehow, seems to me, we could, with enough imagination, put all that together and come out with something that might be good for us. Including the ffm’s, after all, tho they don’t have any imagination, they do have a lotta money.

          Somebody might be able to supply them with the necessary imagination, after all, not much is needed.

          • Nick G says:

            Yeah.

            Carter compared the energy crisis with the “moral equivalent of war”. Johnson coined the War on Poverty. Sadly, real wars seems to capture the imagination of idle young men better than metaphorical wars.

            Still, we should be able to clarify for these young men that building is better than destroying. Books instead of bombs? Now I’m babbling…

            • wimbi says:

              Easy. Every recruiting poster should show, not a splendid young man in a splendid uniform, but sand bars littered with dead marines, body parts, guts, and rats all over the place.

              With a government warning printed in large, bold sticky red,

              Warning, war can kill, maim, derange, estrange and impoverish.

              With example pictures of each condition.

              Good for starters, anyhow. You can go on from there while I go to bed to dream happy dreams of big PV panels over the superhiways and train tracks from NY to LA.

              Not all hallucinations are equal.

  20. ChiefEngineer says:

    Constellation, a subsidiary of Exelon Corporation, and LA Sanitation today announced the start of construction of a 25-megawatt (net) biogas-fueled cogeneration plant, which will supply 100 percent of the steam and electricity produced to power LA Sanitation’s Hyperion Water Reclamation Plant.

    “Biogas-fueled cogeneration offers wastewater treatment facilities a cost-efficient, sustainable, and resilient energy source that is highly effective at reducing methane and carbon dioxide emissions.”

    http://www.businesswire.com/news/home/20151117006949/en/Constellation-LA-Sanitation-Start-Construction-Biogas-Fueled-Cogeneration

    Now there’s a “shitty idea”

  21. ezrydermike says:

    about that lying thing……

    This report is from The Union of Concerned Scientists. It presents seven “deception dossiers”—collections containing some 85 internal company and trade association documents that have either been leaked to the public, come to light through lawsuits, or been disclosed through Freedom of Information Act (FOIA) requests. Each collection of internal documents reviewed here reveals a separate glimpse of a coordinated campaign underwritten by the world’s major fossil fuel companies and their allies to spread climate misinformation and block climate action. The campaign began decades ago and continues today. The letters, memos, and reports in the dossiers show that company executives have known for at least two decades that their products—coal, oil, and natural gas—cause harm to people and the climate.

    http://www.ucsusa.org/sites/default/files/attach/2015/07/The-Climate-Deception-Dossiers.pdf

    • Our entire infrastructure, the basis of human survival in modern terms, is entirely dependent on continual input of hydrocarbon fuels. There are no alternatives at any viable scale.
      If, 40 years or so ago, ‘big oil’ had published their findings in every national newspaper in the world, as a full page spread, the workers whose livelihoods depended on continued fuelburning would have been the first to man the barricades to prevent anything being done to change or slow it down.
      The fact that we were being told that they were cooking the planet would have been dismissed as (at best) a commie plot.
      Sorry–but that’s human nature for ya.—The here and now is important, 50 years from now isn’t.
      We made the collective decision to invite ourselves to the oil party, because the gifts on offer included as more food than we could eat, cheap pretty clothes, a lovely warm (or cool) house, long life and perfect health on demand, and a big shiny carriage to ride in.
      Now humanity is collectively kicking and screaming because the party’s over.
      Too late to blame big oil for our greed now we’re all sick.

      • Glenn Stehle says:

        I like how Elizabeth Kolbert put it:

        To draw on Klein paraphrasing Al Gore, here’s my inconvenient truth: when you tell people what it would actually take to radically reduce carbon emissions, they turn away. They don’t want to give up air travel or air conditioning or HDTV or trips to the mall or the family car or the myriad other things that go along with consuming 5,000 or 8,000 or 12,000 watts. All the major environmental groups know this, which is why they maintain, contrary to the requirements of a 2,000-watt society, that climate change can be tackled with minimal disruption to “the American way of life.” And Klein, you have to assume, knows it too. The irony of her book is that she ends up exactly where the “warmists” do, telling a fable she hopes will do some good.

        http://www.nybooks.com/articles/archives/2014/dec/04/can-climate-change-cure-capitalism/

        • Bob Nickson says:

          Elizabeth Kolbert is a great writer and I love her work, but maybe she and Naomi Klein should go spend a weekend at Wimbi’s house.

          • wimbi says:

            Um, sorry, would be fun, but my guest room is too fulla junk, which we are giving away asap.

            Besides, there’s a guy just down the road way holier than me, who has made a really efficient house, zero carbon, also beautiful, and he likes to show off.

            I think people here should take a look around. Might be surprised to see a revolution going on all over the country.

        • Nick G says:

          Except, of course, that they’re both wrong.

          Air conditioning can be provided just as well by wind and solar electricity. EVs are better than ICE’s.

          A 2,000 watt society simply isn’t necessary. It might not be a bad idea – Passive (zero input) Houses are just as comfortable as conventional houses, and EVs use 1/3 as much power as ICEs to provide the same transportation – but we can replace fossil fuels at the same scale, if we want to.

      • Nick G says:

        So, EVs, wind, solar and nuclear just don’t exist??

      • ChiefEngineer says:

        Norman Pagett says:
        “Sorry–but that’s human nature for ya.—The here and now is important, 50 years from now isn’t.”

        Norman, you can speak for yourself. But, you don’t speak for me. I only have the quality of life I do because of others before me. I respect others and have a conscious. Human nature in your image is just takers and uneducated. It doesn’t have to be that way.

        • oldfarmermac says:

          Norman Pagett says:
          “Sorry–but that’s human nature for ya.—The here and now is important, 50 years from now isn’t.”

          Just about every classic philosopher and author and just about every modern day psychologist, and just about every economist who takes behavior into account, and as a matter of fact, just about everybody agrees that as a general rule , people DON’T give a damn about fifty years from now when it comes to making short term decisions.

          It IS that way.

          I know quite a few well educated, very liberal people.

          Only a couple of them have given up any significant portion of their current day to day life style in order to change things for the better fifty years from now. They support tougher environmental laws etc,yes, but they do not expect these laws to inconvenience them personally in any significant way.

          They know clean air legislation may result in their electricity bill going up a few bucks, but they have plenty of bucks, and they know they won’t be eating beans instead of steak because a coal mine is closed.

          (You can bet your last dime a man who works in that mine could care less about the state of the world fifty years from now,given he has to pay his bills today.)

          Some of them have bought themselves a PRIUS but they bought them more to show their environmental credentials than to save the environment. They continue to live pretty high on the hog, flying here and there on a whim, and eating steak and lobster, and heating and cooling houses with lots of rooms that are used only a few days a year for guests etc.

          The exceptions make the rule, pun intended.

          There are ninety nine exceptions to every follower of the rule of giving a damn about the fifty year distant future when it comes to personally meaningful actions TODAY rather than words.

          • ChiefEngineer says:

            Mac – “You can bet your last dime a man who works in that mine could care less about the state of the world fifty years from now”

            Self – “It doesn’t have to be that way”

            I would suggest an economy were energy is produced by solar panels and your miner becomes a panel installer.

  22. oldfarmermac says:

    Does anybody know just where all the recent new additional production of natural gas liquids is going?
    From what I read, it does not appear to be economical to add these liquids into the manufacturing processes when making diesel fuel and gasoline.

    I also read that gas needs to be just about pure methane in order to burn it efficiently in a gas turbine. Apparently larger molecules create troubles in turbines. Any comments from those who know appreciated, thanks in advance.

    • R Walter says:

      Don’t worry, somebody has a handle on that segment of the industry.

      http://www.targaresources.com/operations/gathering-processing/field-gathering-processing

      • oldfarmermac says:

        Thanks Ronald,

        No doubt these liquids are processed and sold.

        What I am wondering about is the end uses they are being put to, since they seem to be so plentiful these days.

        • AlexS says:

          Part of NGLs are mixed with other hydrocarbons( from crude and condensate) as inputs in refineries
          Part is used to produce LPG
          The largest part is used as petrochemical feedstock

        • Synapsid says:

          OFM,

          For the Gulf oil producers the big buildout in petrochem is going on in JVs in Saudi Arabia and Abu Dhabi especially, and petrochem uses NGLs as AlexS and NickG mention. I think Kuwait is moving the same way but I haven’t been paying attention; Iran will do the same I expect.

  23. ezrydermike says:

    WASHINGTON: Oil prices near $40 (Dh147) a barrel aren’t the only proof the world is flooded with crude.

    The discount on immediate crude supplies in the US has widened to the largest in six months as robust output and imports swell inventories, according to Barclays Plc Spreads between monthly oil-futures contracts are often seen as the most reliable gauge of market conditions, and a discount on the earliest months — known as contango — typically signals that supplies exceed demand.

    While the nation’s crude production is forecast to shrink next year, output has only retreated gradually so far as shale explorers maximise efficiency and focus on the most prolific fields. Inventories are filling so fast that a growing fleet of tankers is waiting to unload at terminals on the Gulf Coast.

    http://gulfnews.com/business/sectors/energy/world-floating-in-oil-is-shown-by-contango-at-six-month-peak-1.1620992

    • ezrydermike says:

      After some initial excitement, November has seen crude oil prices collapse back towards cycle lows amid demand doubts (e.g. slumping China oil imports, overflowing Chinese oil capacity, plunging China Industrial Production) and supply concerns (e.g. inventories soaring). However, an even bigger problem looms that few are talking about. As Iraq – the fastest-growing member of OPEC – has unleashed a two-mile long, 3 million metric ton barrage of 19 million barrel excess supply directly to U.S. ports in November.

      http://oilprice.com/Energy/Energy-General/2-Mile-Long-Stretch-Of-Iraqi-Oil-Tankers-Bound-For-US-Shores.html

      • Watcher says:

        http://www.bloomberg.com/news/articles/2015-09-29/jefferies-china-s-demand-for-oil-is-totally-misunderstood-by-the-market

        Yu’s team has grown more than a little sick of reports linking weakness in crude oil prices to softening economic data in China. There’s one big problem with this narrative, according to the analysts: Chinese oil demand is actually quite robust, up 9.2 percent year-over-year, as of August.

        • Dennis Coyne says:

          Hi Watcher,

          China has kept there currency strong which results in cheaper oil prices and increased oil consumption, at the same time their manufacturing sector is not doing well because the Euro, Won and Yen are all weaker so Chinese exports are less competitive. China imports a lot of raw materials and those commodity exporters are doing badly due to lower demand from China.

          The IEA, EIA and OPEC all think oil demand has risen which would be consistent with increased demand from China.

          The problem is that oil supply has continued to grow faster than oil demand has grown.

          I know you don’t believe in supply and demand. What is the reason for World oil price movements in your view? Are they random movements determined by a monkey throwing darts at a board with price levels?

          • Yes but Chinese demand growth is slowing considerably. I would not be at all surprised if demand started to decline soon.

            Chinese Oil Demand To Moderate, At Best

            After a bullish 8 months, Chinese oil traders are stepping on the breaks. And demand, from hereon in, is not expected to surpass 2% growth rates on an annual basis, Barclays Capital analysts say.

            China’s oil demand growth weakened to 2.1% yearly in September, according to government figures released on Friday. The slower growth rate is consistent with declining overall economic activity. China’s third quarter GDP growth came in at 6.9%, just a tad under the government’s 7% target. Fundamentals suggest moderate demand ahead, providing little China support for oil prices this week.

            • So Forbes has hired people who write “breaks” when they meant to write “brakes”. They can’t afford editors any more?

              • Fred Magyar says:

                If you step on a frack you break your economy’s back!
                And once the economy’s back is broken, it crashes and Forbes goes broke, can’t afford an editor…
                https://goo.gl/Dn2dp5

                • Caelan MacIntyre says:

                  No Hands

                  It’s the faces and foley that make this one (which continues a bit after the credits).

                  No hands is pretty much this uneconomy. Clever but fucked-up.

              • SatansBestFriend says:

                David Archibald complains about someone making a mistake?

                I hope you aren’t the one that thinks he’s smarter than all the climate scientists on the planet!

                LOL!

            • Watcher says:

              In the interests of a pure experience, let’s sashay over to India.

              http://www.forbes.com/sites/judeclemente/2015/08/07/indias-rise-to-3rd-place-in-oil-demand/

              Cool graph saying Japan, with lower prices, is choosing to demand less, and son of a gun if they ain’t somewhere about 120 yen to a dollar, showing no signs of exploding to 150.

              But more to the point, India’s demand is up 300Kbpd on the year, which ain’t hay. Since 2005, India has been responsible for 20% of incremental global oil demand increase, versus 55% for China.

              They ain’t slowing down, either. And that slope of that blue line is steeper than the decline of the red, so they are more than undoing Japan.

              Useful tidbit, Jeffrey:

              Gasoline use is up 20% this year, but still only accounts for 10% of India’s oil demand, versus 20% in China and 47% in the U.S. Fourth globally, behind the U.S., China, and Russia, India now has a refining capacity of 4.5 million b/d, double the capacity of 2006. This is more than any country in the Middle East (Saudi Arabia leads at 2.9 million b/d), and potentially reaching 6.3 million b/d by 2020. Within a few years, India could become the world’s largest market for diesel cars, now standing at over 50% of the fleet.

              Why export US light oil when no one will use it?

              But I digress. No evidence of demand fall. Given China’s monthly car buy and the item above, evidence of demand increase.

              • Dennis Coyne says:

                Hi Watcher,

                Do you think the storage numbers are just made up?

                Demand may be increasing in China and India (or not depending on who you believe), if it is either demand is decreasing elsewhere or supply is increasing faster than demand (or it was as storage levels rose).

                Still waiting for an alternative hypothesis for what determines prices as you don’t like standard economic theory. Old theories are discarded when a better theory is proposed, you have no theory or hypothesis.

                • Watcher says:

                  That’s not how the world works. I don’t have to find the murderer.

                  The burden of proof is on the theory, and when evidence is presented the theory doesn’t explain, the game is over.

                  BTW it’s not standard economic theory. The phrasing some decades ago was always “in a market economy” blah blah blah. Don’t know if it still is. You should look it up to see if it’s all still conditional.

                  • oldfarmermac says:

                    Discussing anything to do with supply, consumption, and price, never mind that bastard whore word demand, with Watcher is about as futile an exercise as anybody has ever attempted in this forum.

                    I presume he knows better than he writes, and is merely entertaining himself. Otherwise………

                    He is making the same mistake (and maybe it is NOT a mistake, but deliberate ) made on a daily basis by politicians who cherry pick a few facts and argue conclusions directly contradictory to all the rest of the relevant facts. The politicians do it on purpose of course, such as when Democrats lambaste Republicans for deficits because they cut taxes, and Republicans lambaste Democrats for deficits saying they spend too much.

                    Simple minded non thinking people (MOST PEOPLE ) who have already made up their minds which political camp is home always swallow such misleading simplistic arguments whole.

                    Everybody else here understands that there are multiple factors that determine the price of oil, or any other commodity, and that at various times,some factors outweigh other factors, with the price going up or down.

                    Economists are even remotely so simple minded as Watcher makes them out to be.

                    Ordinarily as fuel oil gets cheaper,we ( the collective customer ) will buy more of it. This general case example is never disputed except by idiots. But in the SPECIFIC case, I personally, the individual customer, may well use LESS fuel oil this winter than I did LAST winter, even though it is cheaper now. WHY ?

                    Because last winter was a cold one, and this one may be mild.

                    Such complicated (sarc ON ) matters are, as evidenced by his own words, too complicated for Watcher.

                    In WATCHER WORLD his child is the ONLY one in the school band marching in time with the music. ALL the other kids are doing it wrong.

                  • Dennis Coyne says:

                    Hi Watcher,

                    There is no perfect economic theory. The theory of supply and demand works well enough when a market is close to perfectly competitive (many buyers and sellers like the oil market.)

                    If you want to propose an alternative theory, it would be interesting, that is how the world of science works. Theories are only discarded when a better theory supplants it. Read the Structure of Scientific Revolutions by Kuhn to gain an appreciation of this.

              • john keller says:

                I just saw numbers for India’s October oil usage-up 500kb/d.

          • Donn Hewes says:

            Here is my problem with “supply and demand” as you call it. Robert Rapier recently posted a very cogent description of the five stage of a standard boom and bust cycle for oil. This description implies and I think many folks believe that each stage is driven by the one in front of it and therefore completely unavoidable. For example: a rise in price will “always” lead to a rise in production and a fall in price will “always” lead to a rise in consumption.

            Unfortunately, if you believe in peak oil as I do, and most posters here do; you realize that at some point this “cycle” will not perform as per normal. Is it guaranteed that the only point in the cycle that can fail is when very high prices fail to yield ever more production?

            I think it is possible for anyone of these links in the “business cycle” to fail. I don’t think the boom and bust cycle alone is a guarantee of future production in one year, or three, or ten.

            • oldfarmermac says:

              Cyclic business models hold up very well indeed, going backwards.

              They hold up going forward until they fail.

              Any economist could come up with dozens of examples of cyclic models that lasted decades or even centuries, but it is my belief that just about all and perhaps every cyclic business model will eventually fail.

              I have not read Rapier recently, but I have no doubt if asked, he would agree that eventually, and most likely withing the next half century, the cyclic oil industry model will fail.

              But it still no doubt provides some useful insights into what might come to pass in the oil industry over the next decade or two or three.

              My own seat of the pants guess is that it will fail due to geological limits and to either or both economic collapse and or economic substitution of oil by other energy sources such as synthetic oil made from coal, and renewable electricity.

            • Dennis Coyne says:

              Hi Don,

              The high prices result in more supply along a given supply curve.

              In economic theory the supply curve is not fixed it shifts depending on many factors, improved technology tends to reduce costs and shifts the supply curve to the right (so that more is supplied at the same price due to lower cost of production). Depletion raises costs and shifts the oil supply curve to the left so that less output is supplied at any given price.

              The theory works just fine as long as you do not make the incorrect assumption that the supply curve or the demand curve are fixed.

              The idea that high price always results in more supply would only be correct if demand is unaffected by the price (not usually true except in the very short term) and if the supply curve is fixed (also not true as explained above.)

  24. AlexS says:

    RE: Russian oil production forecasts

    Below is a table with estimates of future oil production in Russia

    Sources:
    1) Russian Energy Ministry data and most recent forecast for 2015 and 2016
    2) Russian Energy Strategy to 2015. (Prepared by the Energy Ministry in 2014-15)
    3) “Global and Russian Energy Outlook to 2040”. Energy Research Institute of the Russian Academy of Sciences (ERI RAS) and the The Analytical Center for the Government of the Russian Federation (ACRF). Moscow, 2014.
    4) EIA International Energy Outlook 2014
    5) EIA Short-Term Energy Outlook, November 2015
    6) IEA World Energy Outlook 2014
    7) IEA World Energy Outlook 2015
    8) IEA Medium-Term Oil Market Report, February 2015
    9) IEA Oil Market Report, June-November 2015
    10) OPEC World Oil Outlook 2014
    11) OPEC Monthly Oil Market Report, November 2015

    • AlexS says:

      Russian oil production forecast to 2020
      Source: GlobalData (Energy consultancy)

      • Watcher says:

        The lesson of the price crash is that if you have a central bank, you can lend money to your domestic drillers and get all the production that is geologically possible with more or less no economic aspect to it.

        • AlexS says:

          Watcher,
          This is a lesson from the US oil industry. It does not apply to other countries, particularly Russia. All Russian companies are profitable and generate free cashflow even at current low oil prices.

        • oldfarmermac says:

          The economic costs may not be obvious to the public but they are perfectly obvious to anybody willing to think about these costs a few minutes. Every ton of steel and every foot of wire and every man day of skilled and professional labor that goes into high cost oil production is a day diverted from some other way of using it in the economy. This means fewer bridges built or repaired for instance.

          Every dime spent subsidizing oil production is a dime collected either in the form of taxes or in the form of printed money that debases the value of ALL the same sort of money, meaning dollars here in the USA.

          There ain’t no goddamned free lunch involved when money is printed. If there was, then there would be no need for taxes, we could just print it ALL.

          If you put more dollars chasing the same amount of goods and services, prices go up, meaning printed money is a defacto tax on anybody who has money.

          The incontestable fact that prices can be going down even as the amount of printed money is going up trips up simple minded people. People who are willing to think a minute can understand that deflationary pressures can be and sometimes are sufficient to more than offset OBVIOUS inflation.

          But the inflation is STILL THERE , in the form of PRICES THAT DO NOT FALL AS FAR AS OTHERWISE.

          Suppose your household is running in the red to the tune of a hundred dollars a week. If you start earning another forty bucks, you are still in the red SIXTY bucks- which is LESS than a hundred.

          Why this simple concept is so hard for some people to understand is beyond me, but they are adamant that if there is NO HIGH NOON SUN OBVIOUS CORRELATION, then there can be no causation.

          I am as I have said before NOT arguing that subsidizing oil production is NECESSARILY a bad thing.

          An oil subsidy might keep the supply up and the price down so as to prevent a panic or a recession in the short to medium term.

          In the longer term, however, subsidizing oil means that we will be just that much longer breaking our addiction to oil.

          A sudden withdrawal from some habit forming drugs can be extremely dangerous, and even fatal.

          Ditto oil. If we come up dangerously short of oil on short notice one of these days, the economic shock could actually break the back of the world wide industrial economy- or lead to hot wars that could escalate all the way up to a flat out WWIII.

          • ChiefEngineer says:

            You can lead a horse to water, but you can’t make them drink. You are mixing Microeconomics with Macroeconomics. Governments don’t operate under the same conditions as individuals. Please Mac take a Macroeconomics course at the local college. You will enjoy it!

            If the United States froze the money supply after 1945. We would be looking at an economy the size of something like Mexico. Is that your idea of success ?

            • oldfarmermac says:

              I have taken a number of courses in economics and read quite a few books on the subject as well.

              You are free to disagree of course.

              Economics can be win/ win , lose / lose or win / lose according to what the government does with money. If the government prints money, it is not apt to be equally distributed all over the entire economy.

              Somebody gets a wind fall gift, and spends it, and this reduces the amount of goods and services available to every body else, because the giftee is able to buy more than his previous share.

              Chief appear to believe in a free lunch, which is sort of strange for a person who seems to be technically educated.

              Pardon me, but it is YOU who lacks understanding in this matter.

              • Dennis Coyne says:

                Hi Old Farmer Mac,

                If you assume that the economy does not grow then more for me means less for you. Last I checked there was this thing called economic growth. 🙂

                It will not continue forever, but I doubt it will stop next week. Sometimes your understanding of economics seems a bit oversimplified, when the government creates money it does not “give it away”, it gets loaned into existence by banks.

                The giving away of money by the government is done by elected officials in Congress through fiscal policy. That is a separate matter from Monetary policy.

                The two do interact as the Fed buys and sells government bond to control the supply of money.

                The existence of government bonds is entirely under the control of the legislature. A little inflation (2% or less) is better than deflation and that is what the Fed tries to accomplish.

                For the most recent 12 months the US inflation rate was 0.2%. The US deficit was $486 billion in 2014, the lowest since 2008.

                • Nick G says:

                  Just for fun:

                  Don’t forget “seignorage”: government profit by printing/coining money and spending it.

                  Not enormous, but not nothing either.

                  It’s why the EC won’t discontinue the 500 euro note – it’s the favorite of smugglers & drug dealers everywhere, and very profitable.

              • ChiefEngineer says:

                Hi Mac,

                Give a man a fish and he can eat for a day. Teach a man to fish and he can eat for life time(or until we empty the sea). My principals aren’t in the belief of a free lunch. But they include a basic free education.

          • Nick G says:

            Mac,

            If the money supply is inadequate, then the economy is throttled, and you get deflation. So, if the money supply is inadequate, then printing money can provide benefits to all. It feels a little like a free lunch, though it’s not really – it’s just providing a necessary tool for commerce.

            But, if the money supply is adequate, then more money will just cause inflation.

            • Dennis Coyne says:

              Hi NickG,

              The inflation only occurs if the economy is growing rapidly, otherwise the excess money just sits in the Bank, the banks don’t want to lend it or qualified borrowers do not want to borrow.

              • oldfarmermac says:

                Hi Nick and Dennis, I have no argument with what you are saying right now, none at all.

                Certainly the money supply has to be expanded as the economy expands,or pretty soon there would be a crippling shortage of money, just as there was a crippling shortage of coins at times back in the days previous to fiat money.

                But what I have said still holds. Whoever gets the printed money gets more than his fair share, at the expense of every body else who gets a bit less when he spends his money.

                Give ME three hundred million funny money dollars, and the other three hundred million people on average in this country are down a dollar each. They have the SAME amount of money as before, but they each on average LOSE a dollars worth of purchasing power, because I will buy up three hundred million of stuff with my gift of dollars. If I spend it on steel and concrete, other people collectively must get by with a little less steel and concrete.

                Now we COULD get into some semantic and technical games talking about printed money that only exists in banks, that STAYS in banks.

                It can reasonably be argued that such money has no defacto or ACTUAL existence since it is not SPENT. I probably need another word, defacto is probably not the right term.

                Of course it is possible that I might do wonderful things with my gift of dollars, such that everybody else on average is well rewarded for his sacrificed dollar. It is also possible I might spend it all on a boondoggle that results in the waste of the entire amount with no useful return to society.

                In reality, there is NO FREE LUNCH ,ever.

                Somebody, somewhere, someway, always pays.

                Now it IS possible that government can give away printed money and that society as a whole can benefit handsomely as a result. A hundred million in tax or printed money spent on medical research might very well save us a billion in health care costs.

                BUT if the researchers don’t get useful results, they still live and consume, both personally and professionally, while conducting the research. Their living did not just pop into existence, they consumed food and housing and energy and materials in their labs etc.

                SOMEBODY paid for all that stuff, somebody put work and capital into producing what they consumed, and in the very last analysis, society paid. .Since everybody in our society uses money, well, each one of us contributes a bit.

                EVERYTHING is always paid for, in one way or another. If you find a ball point pen in the street, somebody paid for it, or stole it, or got it as a gift. The manufacturer paid to manufacture it.

                Goods and services don’t just pop into existence out of the so called ether, anymore than more so than one side of a chemical equation can have more mass than the other. If fifty grams of material are put into a reaction, fifty grams come out on the other side. Some might be misplaced of course , according to a balance beam, being lost as a vapor.

                Some mass might APPEAR to have been gained, but careful examination will reveal that the extra mass is the result of water vapor in the ambient air etc, being incorporated into the resulting product.

                There just isn’t any damned such thing as a truly free lunch.Anything that is purchased using funny money is purchased at the expense of SOMEBODY losing an equivalent amount of purchasing power . This is just basic arithmetic,once you blow away the smoke and smash the mirrors.

                The world is well supplied with economists who believe in impossible things. We were discussing one just a couple of days ago who insists we can manufacture copper from other metals.

                • Dennis Coyne says:

                  Hi Old Farmer Mac,

                  The Fed does not print money and hand it over to the legislature to give away. They buy and sell debt instruments created in the past to finance deficit spending.

                  If the government spends money to build roads or fighter planes, that usually puts someone to work.

                  I would rather see them building high voltage DC transmission lines or doing public private partnerships to expand the rail network, but either way, by giving away that money we tend to create a larger economic pie.

                  We could just rely on private investment, but sometimes that is not enough to create full employment.

                  It does seem like you understand microeconomics (used for running a farm) better than macroeconomics (monetary and fiscal policy affecting the nation as a whole.) Have you read any books by Krugman?

                • Nick G says:

                  Anything that is purchased using funny money is purchased at the expense of SOMEBODY losing an equivalent amount of purchasing power .

                  Well, no. The economy isn’t a zero sum thing. An expanding money supply means the economy can grow, which means more goods and services for everyone. If General Motors figures out a way to make a transmission with one fewer assembly guy, that puts that person out of work, but economic output doesn’t go down. Now, if GM doesn’t spend the savings from that layoff (let’s say they buy back stock, and the investors who get the money don’t reinvest it productively), then the economy won’t grow. You’ll have an “output gap”: potential production that isn’t being realized.

                  If people spend or build something productive with their money, rather than squirreling it away in paper savings, then the money supply expands (“velocity” goes up, because money is being spend faster).

                  When investors invest that money in something productive that employs that assembly guy, then the economy expands and people get new and additional goods and services.

                  Now, that doesn’t mean that some people might get more than others, but that’s very different.

              • Nick G says:

                Well, if the money sits in banks, then the money supply hasn’t really expanded: deposits have gone up, but velocity has gone down.

                We’re getting into the weeds, here, but details matter for understanding.

                When I say “the money supply is adequate” I mean that it’s growing along with the real economy. If it grows faster than the real economy, then you just get inflation. If it grows slower, you could just get deflation, but you also tend to get an output gap.

                • Dennis Coyne says:

                  Hi Nick,

                  The money supply includes bank deposits, currently the money supply is high but velocity is low.

                  For those that like to think in terms of printed money its like having a warehouse full of printed cash that nobody is using.

        • ktos says:

          “you can lend money to your domestic drillers and get all the production that is geologically possible with more or less no economic aspect to it.”
          But you will just fill the storage with this oil. Low oil price is for a reason. It’s the economy telling drillers, that it doesn’t want (can’t afford) this oil.

          • Caelan MacIntyre says:

            Then will oil be going lower and lower in price as its cost to get it spirals upward?
            This seems in line with what BW Hill has been apparently suggesting.

            • Dennis Coyne says:

              Hi Caelan,

              It is just a matter of supply growing more quickly than demand.

              The low price in BWHill’s model has to do with consumers not wanting the oil because it’s “net energy” is too low. As far as I understand it the energy in a gallon of gas doesn’t really change even if its net energy is zero, it still works just fine in my car. 🙂

      • AlexS says:

        From BP Energy Outlook 2035 (February 2015):

        “Russia’s liquids production (11 Mb/d in 2035) trails only the US and Saudi Arabia. Tight oil production commences post-2020 and gradually grows to 5% of the country’s total oil output by 2035.”

      • Dennis Coyne says:

        Thank You AlexS.

        So basically the Russian estimates are the most conservative estimates with one showing flat output and the other showing a 1.1 Mb/d decline by 2040 from 2013 levels. All other energy agencies EIA, IEA, and OPEC are forecasting an increase in Russian output.

        Basically, given this information you have chosen an estimate in the middle (flat output), much as I might have done, had I put all this information together.

        Your analysis sure strikes me as being reasonable, but sometimes you get surprised.

        I don’t think anyone saw the US peak in 1970 coming (except Hubbert), but then nobody saw the increase in LTO output coming either so it works both ways I guess.
        If Russian output does start to decline in 2022 (a WAG for sure) the decline is very likely to be slow (1% per year or less) until 2030, that is as far as my guess will go and your estimate is undoubtedly better than mine.

        • Well Russia’s Deputy Prime Minister and their Minister of Energy are not so sure anymore that they can keep production flat.

          Risks of oil production decline in Russia remain — Deputy PM

          MOSCOW, November 19. /TASS/. Oil production decline in Russia is still possible, Deputy Prime Minister Arkady Dvorkovich said on Thursday at ENES-2015 forum.

          “Further risks exist. We are discussing them. Nevertheless, we have clearly determined plans to stabilize production,” the official said.

          The government intends to maintain the achieved oil production level on account of introducing new technologies and providing benefits to companies using innovations.

          Russia’s oil production may decline by 10 mln tons in 2017 — Ministry of Energy

          MOSCOW, November 17. /TASS/. Russia’s Ministry of Energy notes probability of oil production decline in Russia by 10 mln tons in 2017, First Deputy Minister Alexey Teksler said on Tuesday.

          “We forecast production will be 533 mln tons this year and plan to keep this volume in the next year. However, production may decline up to 10 mln tons already in 2017,” Teksler said.

          This is a conservative assessment, the official said. “We sent the production outlook for 2017 amounting to 527 mln tons to the Ministry of Economic Development,” he added.

          TASS reported earlier the base case of Russia 2035 Energy Strategy provides for oil production at the level of 525 mln tons. Russia’s oil production amounted to 525.7 mln tons in 2014.

          Projected oil decline in 2017 is therefore consistent with forecast figures of oil production in 2035 Energy Strategy.

          It should be blatantly obvious, to anyone who has been following the Russian oil production saga, that they are making desperate and heroic attempts just to keep production flat. And that they are now hedging their bets because they know they are likely to fail in that attempt.

          They are now saying: “Okay, so production will likely fall 10 million tons in the next two years, but that’s okay, that’s okay, because after that it will jump right back up to the present level and stay there until 2035.

          Now I fully realize that some guys wouldn’t know bullshit if a gob of it hit them in the face, but I do hope most folks out there are not so bullshit impaired.

          • AlexS says:

            Ron,

            The vice-minister indeed said that production could drop to 527 mn tons in 2017, if prices stay at current very low levels. This is not yet an official forecast, but I totally agree that such a decline is possible. But is it really big?

            533 — 527 = 6 million tons (not 10) =120 kb/d, or 1.1% decline.
            Is that really a collapse, considering that such a decline is possible after 2 years of prices twice as low as in the previous period, sanctions, and denied access to western capital markets?
            Besides, as I noted, the Ministry is always very cautious in its forecasts, and they never have been over-optimistic.

            From my comment above: “as you understand, a plateau means that there could be years of slightly higher and slightly lower production.’

            It’s ridiculous to consider every annual, monthly, weekly or daily decline as a sign of an imminent and permanent collapse.

            As an example, 3 days ago you wrote: “Their web site, CDU TEK showed a huge drop the last few days. They are at 1446.9 thousand tons per day. They were around 1470 just a few days ago. I expect to see Russian production lower in November and December.”

            In fact, after a drop to 1446.9 thousand tons on Nov.15, output increased to 1466.4 thousand tons on Nov 16, 1472.4 on Nov 17 and was
            1471.6 on Nov 18. The October monthly average (post-Soviet record) was 1470 thousand tons per day

            And there is nothing “desperate and heroic” in Russian oil companies’ attempts to keep production flat. So far, they were able to moderately increase output, while remaining profitable and generating free cashflows.

          • Dennis Coyne says:

            Hi Ron,

            It takes time to develop new reserves. AlexS has stated that there are large areas of undeveloped resources.

            Russia has a lot of oil reserves, roughly 170 Gb of 2P reserves. I don’t have data on Russian discoveries so I cannot do a proper shock model for Russia.

            I did the following:

            In the US, producing reserves are about 42% of 2P reserves using 2P reserves =1.7*1P reserves and EIA data from 1996 to 2006 to estimate the producing reserves to 2P reserves.

            If we take Russian C+C output as 10.53 Mb/d in 2014 and assume producing reserves are 42% of 2P reserves in 2013 (71.4 Gb), the extraction rate in 2014 is 5.38%. Reserve growth in the US from 1980 to 2005 was about 2% per year, I have assumed 1.8% reserve growth in Russia from 2014 to 2035 and no new discoveries. The extraction rate increases gradually from 5.38% of producing reserves to 6.3% in 2035 (for the US the extraction rate is 12% and for the World about 7% in 2014.)

            The Russian output in this scenario peaks in 2024 at 10.67 Mb/d and remains 10.65 Mb/d or more until 2033. Note that although the reserve growth might be too high, I have not included any new discoveries after 2013 in the scenario. The annual decline rate is less than 0.1% through 2035. Link below to spreadsheet with scenario.

            https://drive.google.com/file/d/0B4nArV09d398T19pQm9LMEYxbXM/view?usp=sharing

            Chart with scenario below.

    • The ERI RAS prediction here in Alex’s post is the one I quoted in my post last year. And you see they have Russia at peak right now. And if you read that very long and in depth report, and I have, you will see that they think Russian production will only decline slightly from their current peak.

       photo Russian Future Production_zps3eyxsfvy.jpg

      As you can see from this graph, 60% of future Russian oil production will come from those very old and depleted Western Siberian Fields. But how is that possible?

       photo Russian Reserves Growth_zpswrvlwir9.jpg

      Simple, those very old Western Siberian fields are gonna grow. As you can see from the above graph, just over one fifth of production in 2040 will come from old fields. But even less than that will come from new fields. So where will the rest come from? From reserve growth of course. Those old fields that have been producing for well over half a century are gonna grow.

      Now Dennis, I hope you understand why I am pessimistic about the future of Russian oil production. These folks, these two Russian think tanks, are pessimistic in that they think Russian production is at peak right now. But after that they are extremely optimistic. They expect those very old depleted fields are going to undergo massive reserve growth.

      • AlexS says:

        Ron,

        ERI RAS and ACRF are only two of numerous Russian institutes and analytical centers which are working on long-term energy forecasts. They have divergent views, but none of them project a collapse in Russian oil output. Projections vary from slightly rising to slightly declining production.
        As far as I know, this particular research is the only one published in English, and one of the most conservative. For example they assume that Russian oil production had already peaked at 523 million tons in 2013 and should have declined to 522 million tons (10.44 mb/d) by 2015 (the report was released in 2014). In fact, average production in January-October of this year was 10.65 mb/d.

        But even the ERI RAS / ACRF forecast implies very slow annual decline rates:
        2015-20: 0.35% p.a.
        2020-25: 0.31%
        2025-30: 0.56%
        2030-35: 0.62%
        2035-40: 0.34%

        The projected decline in 25 years from 2015 to 2040 is 1.08 mb/d, or 10.3%. Would you call this a collapse?

        Another forecast, that implies a decline in Russian oil production, is that of the IEA. Note, that until recently the IEA projected flat or slightly increasing output. Thus, in the WEO 2014, they projected 11 mb/d by 2020. However in early 2015 they have revised down their forecast for 2020 to 10.4 mb/d in the MTOMR (Feb 2015) and in the recently issued WEO 2015 they increased it to 10.5 mb/d. The implied 0.5 mb/d (less than 5%) drop in 5-year period reflects lower oil prices (and hence, lower investments) and the negative effect of the sanctions, but not resource constraints.
        Still, I have seen comments by the Russian experts that the IEA projections for 2020 are too pessimistic. Interestingly, the IEA has recently revised up its near-term forecasts for 2015 and 2016, noting “a remarkable resilience of the Russian oil production”.

        Long-term forecasts by the EIA, OPEC (issued in late 2014) and BP (February 2015) project flat to slightly increasing Russian oil production.
        I do not know if they will be revised down, but certainly not by much. Meanwhile, near-term forecasts for 2015-16 by the EIA and OPEC have been
        revised up. GlobalData is also projecting flat oil production to 2020.

        Finally, the Russian Energy Strategy to 2035 projects generally flat output in the next 20 years. It is based on analysis from various Russian sources, including companies’ internal projections. And the authors certainly have the best knowledge of the Russian hydrocarbon resource base and project portfolio. Note that the Energy Ministry’s forecasts are generally conservative. For example, their forecast for 2014 was 523 million tons (in line with 2013), but the actual output was 526.7 mtons. The Ministry’s initial forecast for 2015 was 525 mtons, and now they expect 533 mtons.

        • Dennis Coyne says:

          Hi AlexS,

          Maybe Ron believes that increased estimates of reserves only happens in the United States, as the EIA reserve data clearly shows that there has been substantial reserve growth in the United States from 1980 to 2005, approximately 2.9% per year on average over those 25 years.

          Chart below shows US reserve growth from 1980 to 2005.

        • AlexS says:

          Dennis,
          The chart below shows the EIA AEO 2015 forecast of US Lower 48 proved reserves (billion barrels)
          They are quite optimistic: reserve additions outpace production.

          • Dennis Coyne says:

            Hi AlexS,

            The EIA forecasts are not very conservative. I think they are overestimating LTO reserve additions, David Hughes covers that in Drilling Deeper.

            The total from US LTO will be 30 Gb or so, from the World perspective, that is a little over a year’s production of C+C.

            How does my Russian scenario seem to you? I didn’t include discoveries because I had no data, do you expect a high percentage of new reserves will come from reserve growth in Russia?

          • Dennis Coyne says:

            Hi AlexS,

            I guess that chart has total liquids rather than C+C (I think), in any case that would be an average output of 9.78 Mb/d from 2012 to 2040. On only 60 Gb of average 2P reserves over the period (I have estimated 2P reserves as 1.7 times proved reserves). Unlike the Russian Energy Ministry, the EIA is pretty aggressive in these forecasts.

          • AlexS says:

            Dennis,

            the chart above is for Lower 48 states C+C proved reserves (I did’t find the EIA forecast forAlaska.
            Below is the chart for total U.S. proved reserves (bn barrels)
            The increase in the past yeasr reflects rising estimate of LTO proved reserves.

      • Dennis Coyne says:

        Hi Ron,

        US reserves grew by 63% in 25 years, from 1980 to 2005, the US fields are also very old.
        Also oil prices were not very high from 1985 to 2002, I expect oil prices to be higher in the future which tends to promote reserve growth.

        I find it strange how people complain that OPEC reserves never decrease, the US reserves have also been remarkably stable as possible and probable reserves are converted to proved reserves over time. Despite what Laherrere and others believe, increases in estimates of reserves over time do in fact happen, just look at the US data.

        • Heinrich Leopold says:

          Dennis,
          Most of the reserve increases in the US came from shale. As much of shale cannot be classified as reserves any more due to to lower prices, there should be a substantial reserve reduction in 2015.

          • Doug Leighton says:

            Totally agree, if you’re referring to conventional reserve definitions. And, extending your argument, other “reserves” are now questionable like Arctic offshore and probably most deep-water oil. But, I doubt the media (or Dennis 🙂 ) will jump onside on this one. Sometimes I think the traditional definitions have been tossed and we now just talk about “oil-in-place” or as Watcher is wont to say, just print more money and….

            • Dennis Coyne says:

              Hi Doug and Heinrich,

              The reason I only looked at 1980 to 2006 for reserve growth in the US was to avoid the increased reserves for shale. Also 2P reserves will decrease with lower prices and they will rise again as prices increase. Typically oil companies make pretty conservative oil price assumptions when determining their reserves.

              Do each of you think Ron’s new view that oil prices may remain low for many years is reasonable? Note that Ron did not say specifically how many years, but I have the impression he is talking long term, like 10 or more years.

              I think oil will be at $75/b or more by Sept 2017, does that sound unrealistic?

              • Doug Leighton says:

                The World Bank Commodity Forecast has oil at $54.6 in 2017 (Nominal US$). Personally, I don’t have faintest idea. But, if I were forced to make a guess it would be that by 2017 we will be well into a worldwide economic recession with correspondingly low oil prices: my opinion on this is worth absolutely nothing. BTW the World Bank Forecast doesn’t have oil at your $75 until 2022.

                • Dennis Coyne says:

                  Hi Doug,

                  I guess it depends on who you believe. The EIA forecasts Brent (in 2013$) to be $76/b in 2017 in their reference scenario. The low price scenario has the oil price at $52/b in 2017. Note that the low price scenario assumes higher oil output.

                  My expectation is that low oil prices will eventually reduce supply and will also tend to increase economic growth so that eventually demand growth will outpace supply growth, the excess oil inventory will be reduced to normal levels and oil prices will begin to rise.

                  Just like you I do not know how quickly this will occur. Different agencies have different estimates.

                  I just don’t see the expensive oil producers continuing to lose money for 2 more years, so it seems that oil supply will decrease, usually this would lead to a price increase at normal levels of Worldwide economic growth of 3.3% per year.

              • Heinrich Leopold says:

                Dennis,

                The oil price depends on two factors: OPEC and US production. A cut of US production of 2 mill bbl/d has the same effect as a cut of 4 mill bbl/d from OPEC. If US production does not decline, oil prices will rise very slowly – if at all and it will take years until the oil price can rise – even if OPEC cuts. The IEA has the scenario that US production will fall by 2020 by 3 mill bbl/d if oil stays at 40 USD per barrel. And then, the oil price will rise. My scenario is that US oil production will fall by 3 mill bbl/d by the end of 2016 – which will bring the oil price back up again by 2017. I know this sounds somehow like a fast adjustment, yet I know also that change is very swift in the commodity business if it is necessary. I have the gut feeling that OPEC collapses and just everybody produces as much as possible, which will drive oil further down in the short term, yet will bring an oil price recovery much earlier. This is my take on oil which tends to overshoot on the upside and the downside when the market balances itself -at least within the last decade.

                • Dennis Coyne says:

                  Hi Heinrich,

                  So why does a 2Mb/d cut in the US have the same effect on the World oil market as a 4 Mb/d cut by OPEC? Last I checked oil is traded pretty freely on World markets (with the exception of the US that does not allow exports, a stupid policy), so this makes very little sense. Can you explain your reasoning? Also do you expect that World output needs to drop by 2 Mb/d or 3 Mb/d or maybe 4 Mb/d? Don’t you think if supply stops growing the demand growth of 1.2 Mb/d will reduce the 300 Mb of extra inventory in about a year, maybe a year and a half.

                  Also all of the drop in output does not need to come from the US, some could come from other non-OPEC producers. A recession would also reduce output, but demand and supply would both fall and oil price recovery would need to wait for an economic recovery. I just don’t think more than a 1000 kb/d drop in US output is very likely. If your scenario of thousands (are you thinking 2000 or 8000?) of LTO wells being abandoned proves correct, then perhaps we might see a higher decrease in US output, that was what I was expecting when I thought oil prices would quickly recover. That expectation now seems incorrect and even if all new well completion stops in the Eagle Ford and Bakken we get only a 1400 kb/d drop, if we add in the permian (more of a guess because I have no model, maybe another 700 kb/d for a 2100 kb/d drop. With the thousands of well you believe will be abandoned, possibly we get another 500 kb/d (it will mostly be low output wells that are abandoned, if they average 10 b/d, then we would need 50,000 wells, and 25,000 wells at an average of 20 b/d just to get a 500 kb/d drop. I doubt there are that many wells in all of the Eagle Ford and Bakken to accomplish this as the total wells producing in the two plays is only around 20,000 wells, perhaps some Permian wells will be shut in also, but most of the older wells there are conventional wells that are low cost to run.

                  I would love to hear what the oil industry guys think about your scenario, it just doesn’t seem to make sense to me.

                  • Heinrich Leopold says:

                    Dennis,

                    If the US cuts it will impact supply, but also demand as the dollar weakens and the World economy improves. There is no reason why the oil price should go up, when US supply just declines by 1 mill bbl/d. So, the oil price will stay low until there is a cut in the US- and the deeper the cut, the higher the oil price will go. There is no short term scenario that the oil price will go up and US production stays high. So shale companies can wait until low cost production exhausts – which can take years at an astronomic cost – or decide to cut and start production again when prices are high.

                  • Dennis Coyne says:

                    Hi Heinrich,

                    So the explanation is that the weaker dollar doubled the effect of a US cut?

                    I doubt the effect will be that pronounced.

                    Do you doubt the forecasts of increased demand in 2015 an 2016, already US output has decreased by 200 kb/d and another 500 kb/d drop is likely. There will also be reduced output in Norway and Canada and perhaps from some OPEC members that are struggling.

                    The excess World inventories will take about a year to be reduced to normal levels with any combination of reduced supply and increased demand equal to 1000 kb/d.

                    Based on this the market shouls have used up the excess inventory in about a year and then supply will need to increase to keep up with demand, prices will start to rise in 9 months time, say August 2016.

                    How quickly prices rise is very uncertain, it depends how long it takes to ramp up supply, a longer ramp results in a price spike, a quick ramp would keep oil prices rising slowly. Probably the spike is more likely.

  25. Doug Leighton says:

    Apologies to Jeffrey Brown who normally monopolizes these refreshing tidbits.

    ANTIBIOTIC RESISTANCE: WORLD ON CUSP OF ‘POST-ANTIBIOTIC ERA’

    “… resistance would spread around the world and raised the spectre of untreatable infections…. the worrying development needed to act as a global wake-up call as bacteria are becoming completely resistant to treatment (also known as the antibiotic apocalypse) which could plunge medicine back into the dark ages… The concern is that the new resistance gene will hook up with others plaguing hospitals, leading to bacteria resistant to all treatment, what is known as pan-resistance…”

    http://www.bbc.com/news/health-34857015

    • robert wilson says:

      I graduated from Baylor University College of Medicine (now Baylor Medical College) in 1955. I recall that during the 1953-4 era our bacteriology professor was hysterical about the overuse of antibiotics and antibiotic resistance.

      • Caelan MacIntyre says:

        It seems typical of what is said about humans being clever but not wise.

        …All those promises we were fed when we were young and even now about how technology and/or technological advances are going to fix everything and make our lives better… and how we’d all lead long, healthful lives of leisure and whatnot…

        I guess once we get those windmills, PV’s, and fusion reactors… Oh wait…

        “The simplest answer to better health and longer lives, which cause an excess of retirees:

        Postpone retirement age!!” ~ Nick G

        “Get back to work, you lazy old $#@&%!” ~ Nick Gigafactory

        We’re Here For A Good Time (Not a Long Time)

        • R Walter says:

          There is one reason the US gov would advocate postponing retirement: you continue to work and pay the federal insurance corporation of America the insurance is paid. When you retire, the premiums paid fund the retirement benefits. The funding, the revenue, is a percentage of wages earned. Social Security is not a government grant, people pay for it, they fund it, not the gov.

          The Reagan Administration raised taxes for self-employed from 9.5 percent to 13.5 percent or a fifty percent hike in taxes. Republicans are not going to have the average Joe in mind when they do their handy work.

          The second reason for postponing the retirement age is in the actuarial tables. The number of people aged 62 to 70 will have a death rate and there will be fewer individuals retiring when they are 70 simply because some were going to die before they reach retirement age. All things considered, it is their favor if you die before you retire, in fact, they’re probably hoping you do. Raising the retirement age to age 70 is a cinch to have fewer applicants. That is the plan, it is so freaking obvious.

          • Caelan MacIntyre says:

            Contrary to what some people might think, government is supposed to be The People– essentially one-and-the-same– and when government is not, then we have a problem (and we don’t have government anymore, just a gang).

            People can, truly democratically, tax themselves and do a better job of it because it is in their best interests, as opposed to the interests of some outlaw gangs some incorrectly call ‘government’.

      • oldfarmermac says:

        I had ag professors in classes relating to production practices explaining what a great thing it is to put livestock on antibiotics in feed. It worked then, and it still works today, and is still a very profitable thing to do.

        It works long term only because you switch to new antibiotics periodically.

        My biology professors were livid and accused the ag guys of being nut cases.

        But some of the antibiotics so used back then are now just about worthless, and in the end, more will be rendered worthless.

        The same holds true for insecticides. Microorganisms and insects reproduce at mind boggling rates, and it evolve resistance in a matter of years or decades.

        I could poke around in the mental attc and come up with a list of a dozen chemicals pesticides formerly used in orchards that are now basically useless against fruit tree pests.

        Such is biological warfare.

        People are going to die, some have died already as a result of this practice.

        But it could be that more would die for lack of food if we were to stop doing it. Meat would be a little more expensive, and a little more feed would be needed. The stuff we feed livestock is the same stuff poor people generally eat directly.

        If the price of grain goes up, somebody somewhere goes to bed hungry.

        If we quit using synthetic fertilizers, herbicides, pesticides,etc, here in the land o the free, we will have to double or triple the amount of land under the plow in order to maintain current food production.

        (I will not argue that given a Chairman Mao Great Leap BACKWARD sort of reorganization of our entire society, we might feed ourselves organically. Putting the people back on the land might be somewhat of a problem however. It might even be possible at some future time to go organic with most of us still living in cities but that time is in the FAR distant future in terms of current day technology. )

        WHAT COULD POSSIBLY GO WRONG?

        We live in interesting times, to put it as mildly as possible.

        I am with Ron P our gracious host in that I personally expect to be safely dead before the most interesting times arrive.

        • Caelan MacIntyre says:

          “If we quit using synthetic fertilizers, herbicides, pesticides,etc, here in the land o the free, we will have to double or triple the amount of land under the plow in order to maintain current food production.” ~ Old Farmer Mac

          The Seven Myths of Agriculture

          “There’ a lake of stew
          And a whiskey too
          And you can paddle all around ’em
          In a big canoe…” ~ The Big Rock Candy Mountains

          • oldfarmermac says:

            I knew four of my great grand parents, and all four of my grand parents,and went to the fields with them, although the memories of my great grand parents in the field are dim. I don’t think they actually worked much by the time I was old enough to tag along and help a little if only by fetching a tool or watching a couple of smaller kids, but they went, and did a little.

            I worked in the fields, as a kid, and on a summer morning my life was comparable to that of any any peasant any place, I was bent over picking beans or chopping weeds.

            The real difference was that I had an ample breakfast, and an ample dinner, and TWO pairs of shoes, and plenty of supper, and I was went to school ALMOST every day.I was NEVER allowed to skip a day to work, never mind forced to do so.

            I plowed a mule when I was a “large for my age” twelve year old, a few furrows here and there, although I cannot remember a time when we did not have a truck and a tractor.By then the horse and mule were just kept around for old times sake and family gardening mostly, with the major field work being mechanized.

            I know how to fork manure, and milk a cow by hand. I know about using mulch and manure and even about peeing in a barrel and saving it for the crops. I know about saving seed, and grafting my own fruit trees, and pulling a calf if its mother needs help.

            I was born lucky, with a good cpu between my ears, and academics came easy to me. I had a couple of really great teachers, who saw to it I took the placement tests seriously , and that I put it an “early admission ” application at Virginia Tech. I was the very first person in my family to go off to a real university and get a real degree, taking it in agriculture.

            I practiced my profession, off an on, and kept up, technically, including taking the tours and reading the alternative literature.

            So – Perhaps I am qualified to say what is and is not possible, at least in the short to near term, when it comes to agriculture.

            A snowball on a red hot stove has a better chance than we do, as a society, of abandoning industrial agriculture, as it is practiced today, in the short to medium term, meaning within the next two or three decades for sure , and considerably longer almost for sure.

            There are technical issues, which in and of themselves are as formidable as any involved in any field, but the technical issues are at least potentially amenable to solutions.

            These issues are comparable in scale to issues such as overpopulation, depletion of non renewable resources such as fossil water and oil, antibiotic resistance, air and water pollution etc.All these issues are inextricably intertwined with agriculture of course.

            The cultural and economic issues dwarf the technical issues.

            Moving people in the short to medium term by the tens of millions, in order to revert to small scale, localized, low impact low energy organic agriculture, or something approaching organic agriculture, would be such an gargantuan undertaking that even discussing the possibility of this happening voluntarily is absurd.

            Consider the difficulty and the scope of the problem of just switching from using fossil fuels to generate electricity and heat our houses and buildings. NOBODY other than the most gung ho technocopians think we can get possibly get away from using coal and gas to generate electricity in less than three or four decades, and doing it within that time frame will require a non stop pedal to the metal commitment to building out renewables and refurbishing existing buildings etc so as to use electricity more efficiently.

            But as big a job as it is going to be, we can, if we REALLY put our backs into it, at least get MOST of our electricity from renewables, within the next few decades, WITHOUT SUBSTANTIALLY DISRUPTING the typical person’s life style.Running the washing machine mostly when the wind is blowing or the sun is shining is NOT a major lifestyle disruption. Switching to led lights and adding insulation and shade trees does not substantially disrupt ones life. Driving a smaller more efficient car, or taking a bus to work, does not substantially disrupt one’s life.

            There is not the slightest possibility we can abandon industrial agriculture as is practiced today, without substantially disrupting just about EVERYBODY’S life.

            There is not a snowball in hell’s chance such a transformation will come about VOLUNTARILY.

            There are no doubt some people who are willing to eat down the ladder a bit, but the average man in this country is not about to consider giving up his occasional steak and his regular burger.

            I can’t even GIVE AWAY a perfectly good apple if it has a little frost burn or scab on it, although once peeled such an apple is indistinguishable from one that is cosmetically perfect.

            Anybody who thinks he can convince the hundred million women who buy the family groceries to buy blemished apples has another think coming. Anybody who thinks he can convince a few tens of millions of people to move out into the boonies to work in the dirt, and live in mostly non existent housing, for piss poor wages is so deluded as to border on insanity.

            Economic and ecological collapse may well put an end to industrial agriculture as it is practiced today, sooner or later.

            But unless the world goes mad max, industrial agriculture is here to stay for the foreseeable future.

            Some technologies can be scaled up. Some can’t.

            You can grow all sorts of veggies in the backyard , using bone meal, fish emulsions, green sand, and grass clippings, and picking insect pests off by hand, or using biological controls.

            You are never going to grow a thousand acres of wheat using green sand and bone meal. Green sand and bone meal do not exist in such quantities. The grass clippings I used to put on my backyard garden when I lived in the city do not exist in such quantities.

            Biological controls can and do work but pesticides are almost for sure going to be needed just the same, just as gas fired generation is needed to back up wind and solar electricity.

            You are never going to get the NPK out to the field to replace what leaves with the harvest, and runoff, unless you mine the minerals and manufacture them into fertilizer, or manufacture it from methane.

            The biological laws that apply to agriculture are just as cut and dried and indisputable as the laws of thermo. You take the minerals away, you have to replace them. A FARM is NOT an ecosystem, unless it is a SUBSISTENCE farm.

            There just aint that much manure in the world, and most of what does exist is excreted on a daily basis hundreds or thousands of miles from the fields, with no good way to collect it , to store it until needed, or transport it.

            It is hard to say what the future holds, but it is NOT so hard to exclude certain future scenarios.

        • oldfarmermac says:

          http://news.discovery.com/human/health/new-resistant-superbug-spreading-151119.htm

          Feeding anti biotics to confined pigs is lunacy, when the antibiotics are still useful in human in health care settings.

          This is double lunacy in fact, since pigs have metabolisms more similar to our own than any other livestock.

          Any serious MD will tell you the safest way to look after somebody with serious chronic health issues is to keep them away from hospitals and doctors offices to the extent possible, consistent with their getting in office or in hospital necessary treatments.

          Our family physician often remarks that the fact that we STAY away from such places,as well as assisted living and nursing homes, to the extent we possibly can, contributes meaningfully to our average extended family life span exceeding ninety .

          ( excluding accidental deaths and one cancer brought on due to exposure to industrial chemicals, so far as we can determine.)

          Hard work, but not too much hard work, simple food, fresh air, and a belief in God contribute mightily as well. It does not matter if God is there or not, it’s the thought that counts. Religion can be a root cause of the worst sort of troubles, but it can also contribute mightily to personal happiness and can serve as well or better than any drug when it comes to dealing with stress.

      • Fred Magyar says:

        I recall that during the 1953-4 era our bacteriology professor was hysterical about the overuse of antibiotics and antibiotic resistance.

        Well, he was right!

  26. Peter says:

    Geological Peak Oil is still some years away.

    Peak oil is, and always has been about the geological limits of oil production and not about production limited by war, crime or political interference such as bans on drilling or high taxation.

    Countries whose production has been severely impacted by wars are:
    Libya which could produce another million barrels per day, it produced 1.5 million barrels per day before the civil war started.
    Sudan could produce another quarter million barrels per day.
    Syria could get back to it’s half million barrels per day.
    Yemen an extra 200,000-300,000 barrels per day.
    Nigeria could produce a significant amount more if it were not for corruption and theft and sabotage.
    http://www.adomonline.com/news_details.php?article=655
    Brazil has massive corruption and embezzelment problems, depriving the oil company of the investment it needs.
    http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11579470/Brazils-oil-capital-on-its-knees-as-paymaster-Petrobras-under-investigation-for-embezzlement-fraud.html

    Iran oil sanctions has impacted on oil production.

    Iraq, 20 years of oil sanctions and now a civil war.
    http://www.aapg.org/publications/news/explorer/emphasis/articleid/738/iraq-oil-potential

    Anyone who talks about peak oil without a proper and full discussion of these other important limiting factors is being economical with the truth at best.

    • Dennis Coyne says:

      Hi Peter,

      The rest of us live in the real world. Wars and political problems will always be with us.

      Peak oil is not only about the geological peak, it includes economics, politics, war, and geology. Peak oil is when the maximum production of crude plus condensate over any consecutive 12 month period is attained, it will be many years (5 to 10 is my guess) before people believe the peak has been reached as many years of decline following the peak will be needed for confirmation.

      An ideal world with no corruption and no war and no government interference in oil production (though I believe some regulation and taxation of externalities is necessary) does not exist and never will.

      • Peter says:

        Hi Denis

        Your snide remark of living in the real world was rather unnecessary.
        I do live in the real world and am making a valid point that wars, sanctions etc have a major effect.

        M King Hubbert made it clear that his theory in it’s purest sense concerns unrestricted oil production. He did actually say in this interview that political policy could delay that date.

        https://www.youtube.com/watch?v=xPqe-htwlGk

        The number of countries effected by wars and sanctions varies. Iran’s sanctions have been removed and it may be able to produce another million barrels per day.

        As Clever as you are you have no idea what the oil reserves in Iraq are, nor do you know if that country will regain full stability. If ISIS are wiped out as a major fighting force which they could be, then Iraq could go on to meet it’s full potential.

        http://www.worldenergyoutlook.org/media/weowebsite/2012/iraqenergyoutlook/Fullreport.pdf

        It is not impossible to see a conflict induced peak oil, followed many years later by peace and that first artificial peak exceeded.
        No one knows what conflicts may or may not occur nor what impact they may have.
        Therefore peak oil can only mathematically calculated on the basis of the absence of other factors which by their nature cannot be predicted.
        Since these factors can create false peaks which then are exceeded once those factors have passed it should be obvious that peak oil in the real world cannot be predicted.

        • Caelan MacIntyre says:

          “Your snide remark of living in the real world was rather unnecessary.” ~ Peter

          …And remarkably ironic, hypocritical and/or delusive, because Dennis’ apparent so-called real world that he even seems to uphold and defend, is unreal (and corrupt), from so-called economics to so-called government.

          “It’s clear the economic system is driving us towards an unsustainable future and people of my daughter’s generation will find it increasingly hard to survive. History has shown that civilisations have risen, stuck to their core values and then collapsed because they didn’t change. That’s where we are today.” ~ Jon Queally

          See also

          “In Climate Matters: Ethics in a Warming World, John Broome… explains the methods and arguments that help us understand the ethical implications of global warming, and he demonstrates why this reasoning can offer useful insights into how we should act. Trained in economics at MIT, Broome is particularly interested in assessing the ethical judgments made by economists. ‘Economists recognized, say, 50 years ago that economics is based on ethical assumptions’, he says. ‘But a number of them seem to have forgotten that in recent decades. They think what they do is somehow in an ‘ethic-free zone.’ And that plainly isn’t so. And climate change makes that obvious.’ ” ~ David Rotman

          “I will continue to think in terms of the world that exists.” ~ Dennis Coyne

          Uncritically, perhaps, and to defend it too.

          • Dennis Coyne says:

            Hi Caelan,

            No I just don’t pretend that a world without war, corruption, and other problems is likely to exist in the future. That does not mean I defend all that is wrong with the World. I disagree with your right wing sentiment that the government is the source of all that is wrong with the world.

            One of these is taking care of negative externalities, usually taxation is the way to do this, and I know how much you like taxes. How would you deal with polluters who don’t change their behavior when asked nicely?

            • ChiefEngineer says:

              Hi Dennis,

              “I disagree with your right wing sentiment that the government is the source of all that is wrong with the world.”

              I agree with you Dennis. I have a place on Lake Hartwell and travel to the south annually. It’s the poorest place in the country. But they vote themselves governors who turn down free health care for those in need. You get the government you wish for.

            • Caelan MacIntyre says:

              Real government, which we do not have, is in part about voluntary taxation. And so your right-wing quip is moot.
              Your implicit argument seems to be that people will not offer any taxes if they are voluntary, therefore taxation must be by force, yes?

              “How would you deal with polluters who don’t change their behavior when asked nicely?” ~ Dennis Coyne

              Depends on the context. Give me a context.

              Also, how does your status-quo deal with polluters now? Answer; it doesn’t.
              So do you really want the answer or are you just asking the question rhetorically? Because if it is rhetorical, then you don’t care for an answer to your own question, do you? Or have a hard time imagining one?

              I caught Watcher’s mention of burden of proof, by the way. Perhaps this applies with your question in this context here?

              • Dennis Coyne says:

                Hi Caelan,

                As Watcher says, “I don’t have to find the murderer.”

                So burden of proof is silly, any one can say “prove it”, it says nothing at all.

                I am not familiar with Canadian Law. In the US we have the Clean Air Act and the Clean Water Act.

                Is this legislation perfect? No.

                Have they improved the water and air quality in polluted areas of the US? Yes.

                For some context on pollution. A neighbor upstream from your property on a river, routinely dumps his sewage in the stream? He refuses to change his practices when asked nicely. Your move.

            • oldfarmermac says:

              I know a good bit about right wing politics.

              Characterizing Caelan as a right winger is about on a par with calling a typical liberal democrat a communist. It is true that some things a typical liberal democrat wants also appear on communist wish lists, but that doesn’t make a liberal democrat a communist.

              It is true that Caelan seems to have no use for government,or at least not for government as we know it, and it is true that some of the loudest right wingers blame everything wrong on government.

              I have just about given up making any real sense out of what Caelan is all about. So far as I can see, almost every thing he has to say is self contradictory or unworkable.

              Generally speaking right wingers LOVE government.

              They just want government based on their own preferences and desires. The ones who yak the loudest about government being the problem are quick to support the military industrial complex, the drug war, attorneys, prison gaurds, judicial industry as anybody, etc. They want laws, they just want the laws to protect them and punish those they see as enemies or threats, while allowing them to do as they please. They want cops. LOTS of cops. They want highways, lots of highways, sports stadiums, lots of them too. They want to sleep around, but they want it to be against the law for gays and lesbians to sleep around according to their own tastes.

              About the only really and truly big beef they have with government is that they don’t want to pay for any sort of welfare safety net or to pay the costs of environmental preservation etc.

              They want the water flowing INTO the water treatment plant that serves THEIR home town to be nice and clean, of course, but the worst of them ( some uncharitable folks would say all of them, lol ) also want to be free to dump their trash in the river DOWNSTREAM.

              • Dennis Coyne says:

                Hi Old Farmer Mac,

                I did not call Caelan a right winger. I said that his belief that the government is a significant source of evil in the World (which he did not dispute), shares much with the far right in the US (he is from Canada where from what I can tell the far right would be a Democrat in the US).

                You are correct that the right wing likes cops and the military, but they also talk about starving the beast and generally prefer smaller government.

                Clearly the reductio ad absurdium argument is a poor one, but what could be smaller than no government. It is absolutely correct that no mainstream Republican argues for no government, but there are some people on the fringes (not elected) that would prefer no government. My guess is that many of these people in the US would find Republican candidates (if they vote) more attractive.

        • Dennis Coyne says:

          Hi Peter,

          My apologies, I was focused on the following:

          Geological Peak Oil is still some years away.

          Peak oil is, and always has been about the geological limits of oil production and not about production limited by war, crime or political interference such as bans on drilling or high taxation.

          Edit: My interpretation was not so much that you thought that the peak cannot be predicted (which I agree with), I thought you were suggesting that the peak will be much higher or later than some people think. Especially if we have peace and lack of corruption everywhere 🙂

          I tend to think of a geological peak as ignoring economics, the peak in oil output will be determined in part by geology and by technology, consumer preferences, and the interaction of supply and demand for oil.

          First I don’t agree with a lot of what Hubbert said, so “Hubbert said”, doesn’t really convince me.

          My point is simply that we have to deal with the World as it is, that is where we live and where we get our discovery data, production data, and reserve data.

          I use the data provided by Jean Laherrere, the United States Geological Survey(USGS), the BP Statistical Review of World Energy, OPEC, the IEA, and the US EIA. Then I apply Webhubbletelescope’s Oil Shock Model.

          http://peakoilbarrel.com/oil-shock-model-dispersive-discovery-simplified/

          A review of the original model can be found at:

          http://www.theoildrum.com/node/2376

          • Peter says:

            Hi Dennis

            Apology accepted.

            You have stated that there is no such thing as a geological peak other than as a concept.
            The North Sea is actually a good example of a very large area controlled by 4 countries where a geological peak has occurred. The oil companies operated in a peaceful and politically stable area thus being able to show a Hubbert curve in practice. Oil production hit a peak in 2001 at just over 6 million barrels per day, it has fallen practically every year since and stands at 2.8 million barrels per day. Oil prices increased 400% from 2001 Price to 2008 yet this did not stop the decline.
            The fact is most high flow rate oil can be extracted for under $100, the exceptions being the Arctic and perhaps ultra deep water presalt.
            All the rest has very low flow rates, average well production in Venezuela’s heavy oil belt is 850 barrels per day.

            http://www.rigzone.com/training/heavyoil/insight.asp?i_id=185

            Going back to Iraq. A peaceful and stable environment could see oil production reach 8-12 million barrels per day.
            An escalation of the civil war could cripple production as has happened in Libya.
            The Oil shock Model cannot predict any above ground factors so cannot predict oil production in anything other than ideal environments. These tend to be the exception rather than the rule. In practical respects it is almost useless in telling us what any country will produce 6 months from now.

            • Dennis Coyne says:

              Hi Peter,

              I now understand what you mean by a geological peak. So economics is included but not political factors (such as war and corruption).

              On your prediction that a peaceful and stable Iraq could produce 8-12 Mb/d, I have serious doubts. Its oil reserves are claimed to be 150 Gb, but a more realistic estimate would be the 115 Gb they claimed from 2001 to 2010. Russia, with about 170 Gb of 2P reserves will produce about 10.6 Mb/d.

              If the lower reserve estimate for Iraq is correct (and even 115 Gb may be an over estimate) then if Iraq can do as well as the Russians for a proportional level of reserves, they would produce 7 Mb/d rather than the 10 Mb/d you suggest. Perhaps they found 35 Gb of oil they didn’t know about in 2011, but I think that is just an overly optimistic estimate of the recovery factor that will be achieved.

              You are absolutely correct that I cannot predict when wars will start or end. The model simply assumes that the existing reserves will be produced and that future discovery and reserve growth will follow past trends.

              I do not usually predict what will happen in specific countries (though I recently put up a quasi-shock model for Russia to see if the Russian Energy Ministry’s projections seem reasonable.

              Based on 170 Gb of 2P reserves (ABC1 plus o.5*C2 reserves) based on a Wikipedia article and using US producing reserve to 2P reserves (1.7*1P reserves) of 42% as an estimate of Russia’s producing reserves, I estimated the 2014 extraction rate and used a 1.8% reserve growth rate to find that the projection looked realistic. That assumed no new discoveries, so it may be too conservative.

              That is not to say that reserve growth rates could be different, the reserves might be wrong, the producing reserves could be 30% or 50%, I don’t have the data. Also extraction rates could be higher or lower than my guess.

              The point was to determine if the scenarios presented by AlexS were reasonable. Given my assumptions (any of which could be incorrect) the scenarios seem reasonable.

              The scenarios I present for the World have all of the same problems, along with the war and corruption that you have pointed out. I do not know what will happen tomorrow, never mind 85 years from now, of that I am well aware.

    • Fabio says:

      You are right Peter, we are far from the geological peak.
      OTOH, it’s quite remarkable that most wars going on in the world right now were motivated by either oil production or gas transportation agendas, isn’t it?

      • Dennis Coyne says:

        Hi Fabio,

        The idea of a “geological peak” seems strange to me. Who uses the oil? What is a “geological peak”, I don’t think it exists, except maybe as a theoretical construct.

        Lets suppose the World economy has no use for oil at $1000/b, but 150 Mb/d could be produced if we could find someone willing to pay that price. That might be the “geological peak”, but we will never know if it might have been reached because from and economics perspective we will never get there.

        The same reasoning can be applied to War, corruption, and politics, these can certainly be discussed, but I surely agree with Peter that these cannot be predicted. At some point more resources from Nigeria, Brazil, Iraq, and Iran will likely be produced. It is difficult to know exactly when this will occur.

        The oil shock model developed by Webhubbletelescope takes all the known reserves in the World (by Jean Laherrere’s estimate about 2000 Gb of 2P reserves had been discovered by the end of 2010), I add another 200 Gb of discovery and 600 Gb of reserve growth and just assume this oil will be produced. To this 2800 Gb of oil with an API gravity above 10 (not oil sands) I add oil sands from Canada and Venezuela which is assumed to be 600 Gb (375 Gb from Canada and 225 Gb from Venezuela.)

        The model is based on humans developing discovered resources to meet expanding demand for oil, we can choose parameters of the model so that known output determines past extraction rates from producing reserves. Then we create scenarios for future output based past extraction rates. Prediction of future war or peace and there possible effect on future output is beyond my ability. The number of future scenarios that could be created is infinite.

      • Peter says:

        Hi Fabio

        Of course countries or groups of people want to secure natural resources. Britain and Iceland nearly came to blows over fish.
        Hitler attacked Russia for it’s massive land resources and oil.
        The British fought the ungrateful colonials to keep what was rightfully British.
        Coal, oil, gas, land, water all mean wealth and power and people have been killing each other over them for a long time.

        There are conflicts in most parts of Africa, there is little oil in most of those countries.

        https://en.wikipedia.org/wiki/List_of_ongoing_armed_conflicts

  27. R Walter says:

    Supply and Demand:

    Week 45 report has 8,837 petroleum cars hauled by the BNSF.

    Week 45 of 2014, 11,254 petroleum cars.

    http://www.bnsf.com/about-bnsf/financial-information/weekly-carload-reports/

    The demand for petroleum railcars to haul petroleum is waning some.

  28. Doug Leighton says:

    SAUDI OIL MINISTER SAYS OPEC WITH OTHERS TO STABILIZE MARKET

    “The global economy is going through an unstable period, al-Naimi said. Crude demand is expected to rise by 1 million barrels a day every year in this decade, and the world requires more investments in oil to compensate for declining recovery rates, he said. The recovery rate for all the world’s oil fields is decreasing by about 4 million barrels a day, he said.”

    http://www.bloomberg.com/news/articles/2015-11-19/saudi-oil-minister-says-opec-with-others-to-stabilize-market

    • Doug Leighton says:

      Meanwhile,

      OIL SLIDES AGAIN AS FOCUS RETURNS TO HEAVY GLUT

      “Because of the glut, producers are scrambling to offer discounts in an effort to defend market share against their competition.

      OPEC’s second-biggest producer, Iraq, has started to sell some crude grades for as little as $30 a barrel, trade sources said, acting as a further drag on futures.”

      https://ca.finance.yahoo.com/news/u-crude-prices-edge-short-004606325.html

      • Caelan MacIntyre says:

        Apparently, there’s an oil tanker traffic jam in the Gulf of Mexico. It’s cute to imagine– a bumper-to-bumper oil tanker traffic jam. *Beepbeep*

        Now’s the time to haggle. ^u^

        “Ok, I’ll give you $15, but I’d like free delivery…”

        • The Listener says:

          There is not an oil tanker traffic jam in the GOM. Most of the boats are not VVLCs (they are refined product and chemical tankers) and the vast majority had Houston as their last port of call so none of those vessels are carrying oil. Its pretty easy to research this stuff. In the words of Public Enemy, “don’t believe the hype”….

          • Caelan MacIntyre says:

            I guess you are referring to what was mentioned over at Zero Hedge (ZH)?

            “As AP puts it, ‘a traffic jam of oil tankers is the latest sign of an unyielding global supply glut.’ ” ~ ZH

            Anyway, I think they look cute on the map. ^u^

            If they are not in a GOM dead zone, they might as well cast a few lines off the deck if they are going to hang around for awhile. ^u^

            • The Listener says:

              Again, most of those boats on the map are not carrying oil. If you go to the actual website that tracks the boats you will see what kind of vessels each of these red spots on the map are and where their port of origin was. Zerohedge did a cut and paste job of the map and assumed (or lied) that all of these boats are carrying oil which they are not (not even close). Typical zerohedge reporting and propaganda.

      • john keller says:

        I think there will be a cut December 4. For the following reasons:

        1. The statements you mention as well as other Saudi statements regarding inventory levels. They are giving reasons for a cut. The drop in investment is storing up trouble for 2017-2020.
        2. The rest of OPEC hates the Saudis for ramping production up 900,000 barrels/d in 2015. There is a risk of OPEC collapsing.
        3. There are groups in KSA that are against low oil prices. Many are using the economic distress as proof that the Crown Prince needs to go.
        4. Their strategy has worked in popping the shale finance bubble, at least temporarily.

        I think we’ll see SA drop 500,000 b/d.

        • shallow sand says:

          John . You are pretty much the only person who has felt this way besides me. Felt so alone I now am doubting whether they will cut myself.

          Historically, if OPEC does not cut 12/4, it will mark the longest they have waited to do so after a major oil price crash, the others being 1986, 1998 and 2008.

          • Dennis Coyne says:

            Hi shallow sand,

            I also agree with you, but I thought they would cut a year ago, so I often get this stuff wrong.

        • Ves says:

          There are not going to be any cuts guys. If SA cuts that means they are giving away their sole leadership and decision making of OPEC to Iran and to the less extent Iraq. It will be market rebalancing for the price and primarily from non-OPEC countries and if it takes 2-3 years so be it as far as SA is concerned. Cancelling of more than 200 billion of big oil projects in non – Opec countries is just proof that big majors are very well aware of SA intentions.

          • Dennis Coyne says:

            Hi Ves,

            The other OPEC members are aware that the Saudis are pumping full out.
            The could all just cut and let Saudi Arabia continue to pump full out. You are right though that that would be highly unlikely.

            It looks like your view will be correct based on recent reports (I had gotten the opposite impression from reading only headlines (it’s strange that headlines often give the opposite impression from the piece.)

            • Ves says:

              Hi Dennis,
              Just wanted to post this as reply to John so you could see my view.

              John said: ” If they don’t cut, there is a possibility of a new OPEC run by Russia and Iran.”

              It is the other way around. In the low price environment there is no possibility of further expansion in Iran or Iraq production. So that means low price environment aka “no cuts” is what keeps SA in OPEC driver seat.

        • Greenbub says:

          I wasn’t aware they had popped the shale finance bubble.

          • John Keller says:

            They have eliminated the unsecured lending market and equity market for o&g. Banks are decreasing lending albeit slowly. Many more bankruptcies are on the way as companies run out of money. SFY will be gone soon.

            If they don’t cut, there is a possibility of a new OPEC run by Russia and Iran.

            With a cut there will be rebalancing, it will just happen 6-9 months sooner than it would otherwise. SA can turn the taps back on in 2017.

            Watching Venezuela. Fernando brought this up a month or two ago. Newspapers are starting to pick up on the fact that there could be unrest next month.

  29. ChiefEngineer says:

    Audi of America targeting 25% of sales to be plug-ins by 2025; national network of 150 kW fast chargers

    “We believe the era of electric driving has come to a very defining moment. A time when the cost of batteries is falling from a very daunting $1,000 a kWh in 2007 to nearly one-tenth as much by the next decade.”

    http://www.greencarcongress.com/2015/11/20151119-keogy.html

    • Caelan MacIntyre says:

      My 3 1/2 year-old laptop’s second lithium-ion battery now holds about 5-10 minutes worth of charge (and I have that annoying little popup that recommends that I consider replacing my battery).

      What do you engineer, by the way?

      • ChiefEngineer says:

        How to Prolong Lithium-based Batteries

        http://batteryuniversity.com/learn/article/how_to_prolong_lithium_based_batteries

        A 59 year old retired health insurance broker with a business degree in finance and economics. Back in the 80’s, I sold Mack Trucks when fuel economy costs were number one importance after the rise of oil in the 70’s. And yourself Caelan ?

        • So do you do engineering or is it just a moniker?
          But your apparent background would seem to explain some ostensible underpinnings of your comments, yes?

          Thanks for the battery info. I have already read stuff like that ages ago, but will nevertheless go over your link.

          Myself, I am trying to get off the cultural Titanic, but you can Google my name and I have made it selectable hereon as well.
          Along with other projects, I am realigning my background/knowledge while at the same time learning new things that might be valuable and applicable post peak, such as the basics, like shelter/housing, food and clothing. I already know a fair bit about ecologically-sustainable/resilient residential design/building and can design them in 2D and 3D. I can also knit some of my own clothes and recognize an increasing number of edible and medicinal plants that grow wild, most of which I have eaten or drank to good results.
          I would also soon like to learn how to brew simple ciders and how to make freeze distillations from them, in part because the governpimps tax the hell out of booze over here in the other open-air prison known as Canada.

          • ChiefEngineer says:

            Caelan,

            You will seldom find ostensible personalities desirable or successful in the insurance or major capital goods industry.

            Your personal description of yourself reads like a 60’s hippy pot grower looking to get into the alcohol business. People like yourself are why I feel Tverberg and her doomsday blog are so damaging preaching her fear.

            Best Wishes

            • Caelan MacIntyre says:

              Hippy quips are 40-year-old cliches. At the same time, yes, I get that our alcohol, like our shit, is now processed in large vats by faceless entities far away. Go, us. And that governpimps do a fine job of FUD without my, or your beloved Gail’s, help.
              Doomsday, as you call it, seems more about doing nothing about the status-quo, defending it, and/or blocking attempts at its transcendence.

              You and I both apparently come from the original ‘hippies’– the tribes, aeons ago, on the plains of what is now called Africa.
              This is a dignified way to live, and is how we are fundamentally wired– small-scale, real community and all– as opposed to prostituting ourselves for corporations (and governpimp taxation schemes), such as through selling Mack trucks.

              So, like me, you may see fit to free yourself and embrace your inner-hippy, ChiefEngineer, because we may find we will all have to anyway.

              • ChiefEngineer says:

                How do you hide pot from a hippie?

                Put it in his work boots.

                • Nick G says:

                  Those hippie communes involved a lot of back breaking work.

                  Which brings us back to your original point: subsistence agriculture is soul destroying, and people who try it as a voluntary project tend to get beaten up by that life.

                • Caelan MacIntyre says:

                  Cute, and then there’re semantics and context. Like, what do we mean exactly by work; what are we doing, how are we doing it and why and how is it affecting us and our world around us?

                  And is it work, say, in a classic old village context or in a wage-slavery for a corporation in a gutted-pseudo community dying-planet economy-/resource-plunder-of-scale big-box-chain car-parking-lot context?

                  Communes, ecovillages, Transition Towns, etc., exist within (sometimes barely, thanks in part to) the current crony-capitalist plutarchy context which has a lot of land and resources grabbed and wrecked and a whole lot of de-clawed (disempowered) ‘zombies’ by the balls running around with little interest, ability, knowledge and/or circumstance for status-quo transcendence.

                  Maybe that’s all of us here to various degrees.

            • Stilgar Wilcox says:

              “…why I feel Tverberg and her doomsday blog are so damaging preaching her fear.”

              Gail has some interesting views but I don’t understand her recent prediction of financial collapse likely in a few months. Fast Eddy has taken over the message board and he is convinced of human extinction via sudden collapse followed by nuclear contamination due to a failure of shutting down and following needed timelines for cooling fuel rods.

              I’ve tried to explain on there that neither one of these scenarios is likely but to no avail. The collapse fervor has taken hold and many posters are convinced of one collapse scenario or the other. It may be a case of groupthink, but in any case it seems ludicrous while the economy seems to be rolling along just fine. I’ve actually never seen so many people out and about shopping, travelling and going to events here in CA. Every parking lot is near full. Fuel is cheap by recent comparisons and the party for now rolls on.

              To be fair there are those with critical thinking skills on that message board that do not agree with the near term collapse scenarios.

              • Nick G says:

                Reminds me of Nicole Foss, who was predicting collapse within months….6 or 7 years ago.

              • ChiefEngineer says:

                Hi Stilgar,

                I live in CA and totally agree with the commerce you see going on here and we pretty much have the highest cost of gasoline in the country. It seems to be common for Gail to have a Fast Eddy type who watches her back to protect her if you oppose her. Than disappears after a year or so and someone new shows up. There is a pretty good chance that a few of those who have not agreed with her that you have noticed have been me. She has blocked me from posting under a list of different user names. She doesn’t like someone that opposes her views and at times I have been relentless.

                I seldom ever read her blog anymore. It’s always pretty much the same old “we have used up the cheap stuff and can’t afford todays current costs”. Hence collapse.

                • Stilgar Wilcox says:

                  Yeah, CE, I suppose that duo of Gail & FE will keep reinforcing one another’s opinions with a wide following until such day the statute of reasonably intelligible cognition limitations kicks in for some on there to realize collapse is not imminent.

                  Regarding FE’s collapse scenario, it is really laughable that an entire species at this level of knowledge would in the face of economic difficulties allow our mutually assured extinction due to failure to decommission nuclear power plants. If food was in short supply, no doubt we would make sure those entrusted to do such work would get fed. “Here’s some food. Now make sure we don’t all go extinct.”

                • Stilgar Wilcox says:

                  Most of those graphs, BC, simply indicate up and down undulations over time, i.e. noise, or at worse a recent downturn by some metrics. Certainly not imminent collapse.
                  Are you suggesting they indicate otherwise?

              • Fred Magyar says:

                Gail has some interesting views but I don’t understand her recent prediction of financial collapse likely in a few months.

                Here’s one antidote to Gail et al! It may be a world view just as wrong but I for one don’t buy Gail’s views because they are one dimensional. I think the real world is synergistic. You can take six struts and construct two triangles on a plane. If you combine the same six struts in 3 dimensions you get a tetrahedron, one of the basic structures and building blocks of nature with properties that can’t be imagined in a two dimensional thought process. Gail has a one dimensional linear thought process… she is as blind as the six blind men examining the proverbial elephant!

                https://goo.gl/VWuJoC

                We take how we think, and how we take decisions for granted. For the most part we are wrong.

                Professor Lakoff, a world renowned expert in cognitive science and linguistics (University of California, Berkeley), discusses what we have learned from studies of the brain in recent decades. In this webinar he turns his attention to the way we think about the economy, how it relates to our ‘worldview’, our values and politics.

                Is the ‘circular economy’ part of a new narrative, if so, what values underpin it? A vital webinar for all those interested in how change happens. Professor Lakoff is author of a dozen books including Moral Politics (1996), Philosophy in the Flesh (1999) Don’t Think of an Elephant (updated 2014), and the Little Blue Book (with Elizabeth Wehling) 2012.

                • oldfarmermac says:

                  Thanks for that link Fred.

                  I had the not so special privilege of hearing Tverberg deliver her canned talk once at a conference.

                  She is like a deer in the headlights when somebody ( such as an old farmer lol ) asks her a three dimensional question.

                  Tverberg is for simple minded people who are willing to think A LITTLE, and I mean that “little” literally.

                  You are dead on with your remarks about two and three dimensional thinking. People who are really capable of thinking and willing to do so think in four dimensions, including time.

                  Unfortunately we live at a time when times are so good most of us cannot be bothered with more than sound bites, we are too busy with our beer and chips and ball games and executing the built in program that says get very fat if the opportunity presents, there may be a famine this winter.

                  My personal belief is that she has a brand and is selling it, and doing fine. Quite a lot of people do that, including most of our elected politicians.

                  It’s hard to say for sure what a person like that really thinks and believes. A few years back I recall the case of a well known anti gun advocate in DC shooting an intruder in his house by way of example.

  30. shallow sand says:

    There was some discussion on an investor oriented site that shale companies should disclose individual well data. The particular company being discussed was Oasis Petroleum. Thought it might be interesting to look at most recent reported month well production data for Bakken and TFS wells they operate in ND. May be of interest to a few who read/post here. Kind of makes points about both the Red Queen and “core areas”.

    Listed below are field, number of producing wells and barrels of oil per day per well by field:

    Alger 46 wells 97.91 bopd per well.
    Alkali Creek 8 wells 77.46
    Assiniboine 4 wells 40.28
    Baker 30 wells 198.22
    Baker Confidential 15 wells sales of 410.82 bopd per well
    Banks 20 wells 76.65
    Black Slough 3 wells 21.29
    Bonetrail 6 wells 57.68
    Bull Butte 29 wells 39.40
    Camp 51 wells 102.24
    Cottonwood 83 wells 47.77
    Cow Creek 24 wells 104.4
    Crazy man Creek 6 wells 78.41
    Dore 5 wells 61.14
    Dublin 2 wells 59.68
    Eight mile 8 wells 85.36
    Elidah 2 wells 59.07
    Elk 2 wells 47.30
    Enget Lake 5 wells 69.83
    Foothills 9 wells 54.52
    Foreman Butte 11 wells 86.79
    Ft. Buford 3 wells 31.84
    Glass Bluff 3 wells 56.02
    Gros Centre 38 wells 51.69
    Harding 1 well 62.60
    Hebron 1 well 68.33
    Indian Hill 3 wells 37.37
    Lake Trenton 3 wells 42.16
    Leaf mountain 1 well 20.60
    Leaf mountain Confidential 1 well 149.50 Sales
    Lucy 2 wells 69.73
    Marmon 2 wells 51.62
    Missouri Ridge 22 wells 93.13
    Mondak 3 wells 36.12
    North Tioga 1 well 56.37
    North Tobacco Garden 2 wells 67.08
    Painted Woods 9 wells 46.72
    Pronghorn 2 wells 63.33
    Randoplh 1 well 58.87
    Rawson 1 well 73.63
    Rosebud 7 wells 60.21
    Sand Creek 1 well 41.23
    Sanish 19 wells 163.95
    Sanish Confidential 3 wells 412.68 sales
    Siverston 13 wells 99.90
    Squires 13 wells 39.16
    Strahndal 1 well shut in 0
    Todd 3 wells 91.61
    Todd Confidential 3 wells 594.10
    Trenton 2 wells 120.60
    Tyrone 42 wells 93.08
    Viking 1 well 62.76
    Willow Creek 24 wells 86.58

    Again, the second number is barrels of oil per day per well in the field for the month of September, 2015, for Oasis Petroleum. Tried to be accurate, but could be a typo, but not anything high volume. Also, for Bakken and TFS only. Oasis has many other wells in ND and they are trying to sell them. Many are shut in.

    When reviewing data, pretty obvious that almost all high volume wells (over 150 bopd) are relatively new. So, most wells are 30-70 bopd range.

    Here is what a 60 bopd well generates assuming $10,000 per month LOE, $100,000 in CAPEX repairs, 20% royalty, 60 mcfpd gas, all sold, 10% severance, $2.50 per BOE G & A:

    17,520 net barrels of oil @ $35 per barrel = $613,200.00
    17,520 net mcf of gas @ $2 per mcf = $35,040.00
    Less:
    Severance ($68,824)
    LOE($120,000)
    CAPEX Repairs ($100,000)
    G & A ($51,100)

    Net before interest, principal and taxes $308,316.00

    I used $10K rather than $14K as I am assuming the 60 bopd well is producing less water and therefore OPEX/LOE is less.

    Oasis has $2,380,000,000.00 of long term debt that will need to be retired from the above wells’ net proceeds.

    • Toolpush says:

      Shallow,

      Oasis seems to be doing a good job of hiding those 6,000 bopd wells we keep hearing about!

      • shallow sand says:

        Toolpush. That is the point, of course. The investor presentations hype a few wells’ IP and maybe 30-90 day rates. Maybe even will show 180 day, but that is about as far as it goes.

        OAS cleared just shy of $56 million, not including hedges, in Q3. This doesn’t include CAPEX. However they spent $76 million in CAPEX in Q3. Worse, they spent over $500 million in CAPEX first 9 months of 2015. Production will be falling as they will spend less in Q4 than Q3.

        What has helped OAS is a very strong 2015 hedge book. Have realized almost $69 per barrel in first nine months. 2016 is not anywhere near that, on average about half of production is hedged around $53 WTI, so about $48 is what the will realize.

        My numbers exclude their service and water businesses, which are profitable but small compared to their oil production.

        Ultimately, it will take an oil super spike to get the debt paid back. But they are far from the weakest. Again, I know nothing about management or workers at OAS, and I wish them well. Just showing another example of how bad of shape the US oil industry is in.

        • Enno says:

          Good to see you back posting Shallow. Hang on.

        • Toolpush says:

          Shallow,

          Just for the record, and I hope you realized, there should have been a /sarc at the end of my comment. The old street side shell gamers, are mere animators compared to these guys!

    • Rune Likvern says:

      Shallow, thanks and I concur with Enno.

      To me the thing to get a grip on LTO developments going forward in the tight oil/gas plays is about financial dynamics.

      From studying the NDIC/companies 10-K/Qs data I expect CAPEX to come considerable down [rig count and additions of new wells will follow, thus a decline in extraction] in the face of a lasting low oil price. Operating cash flow will become the primary source for funding for the LTO companies. Expectations now are that most companies will strive to become cash flow neutral.
      Some companies are taking [relative] big losses on their natural gas and NGL sales (some had/have losses of $2-3/Mcf and interest expenses close to $8/BOE), this hurts as it eats from net backs from LTO sales. Most LTO companies will continue to show losses on their P&L statements.

      It appears the companies have deployed different strategies, some are in it for returns (the ones with the best wells), some keep up well manufacturing in an effort to sustain cash flows (slow down growth in [debt] leverage) and thus betting on a future increase in the oil price will help retire/roll over debts.

      There are several metrics for leverage, and one to follow is the ratio of annual net cash flow from operations to total debt. A decline in production while debts are unchanged, prices remaining at present levels drives this metric to worrisome levels.

      • Dennis Coyne says:

        Hi Rune,

        Thank you for your insight. I have not dug into the 10 Ks, for the “average company” that you have looked at, would you expect that they will stop completing wells from their “Drilled UnCompleted” (DUC) well inventory altogether?

        There are some who theorize that not only will no new wells be completed if oil prices remain under $45/b, but that thousands of already producing wells will be temporarily abandoned.

        Based on your comment above I think you might disagree, but I often misinterpret your meaning.

  31. Clueless says:

    May have been previously posted, if so, sorry.
    Saudi oil minister said that they need to spend $19.18 per barrel to maintain their position as the safety net for world oil. $700 billion over next 10 years, divided by 10 million bbls/day – my calculation. If he is right, then $20/bbl for oil is TOTALLY out of the question.

    • shallow sand says:

      That is “Arab Nations” not just KSA per Bloomberg story.

      But I assume that only includes CAPEX.

      But that doesn’t seem like much in relation to the CAPEX spent re US shale. See post above, OAS debt and the produce 50 K bopd.

  32. BC says:

    Aristotle, Spengler, Sarkar, and Ibn Khaldun’s social cycles.

    The West faces the end of an era of parasitic acquisitors/oligarchs (to be eventually usurped by a martial era (after the acquisitors fail to co-opt the warriors during a period of heightened crisis) in direct conflict with China (martial era moving toward an intellectual era) and (radical) Islam (intellectual era moving toward an acquisitor era to be interrupted by Peak Oil and a military, last-man-standing contest between the West and China).

    The break in the West will come when the professional middle-class next 9% beneath the top 0.001-1% lose faith and confidence in, and reject the values and objectives of, the top 0.001-1% militarist-imperialist, rentier-socialist corporate-statists, including Wall St., the CEO managerial cast, DC career political caste, and the ministerial imperialist sophist Establishment intellectuals, overwhelmingly disproportionately made up of Jews, as was the case during the Weimar Republic prior to Wall St. and The City’s funding of Hitler and the Nazis to oppose Stalinism.

    • ChiefEngineer says:

      Hi BC,

      The top 10% have a very strong bond together. The 1% need the 9% for their life style and keep the 90% at bay. The 9% like there comfortable position and will bite their tongue as to not become part of the 90%.

    • Caelan MacIntyre says:

      I’m just a closet lumpenproletariat. What happens to me?

    • Nick G says:

      BC,

      I have the impression that your general outlook depends on Peak Oil causing economic collapse.

      So, if oil can indeed be successfully and reasonably seamlessly replaced, then your scenario won’t happen?

      • if oil can indeed be successfully and reasonably seamlessly replaced,

        Nick, do you believe this?

        • Nick G says:

          Yes.

          We have superior or good replacements for oil for most transportation (75% of oil consumption), and adequate replacements for oil for everything else.

          Will the transition be easy or seamless? That depends on your point of view. I’m confident it will be much easier for most people than BC seems to think. But, it could be very bumpy if we have another serious oil shock – the kind associated with M.E. war, for instance. We could see recessions, and/or serious inconvenience: mandatory car pooling, for instance.

          Every day we continue with the relatively slow transition we’re now in, continues to subsidize M.E. war and terrorism, and creates a greater risk of oil shocks.

          Have you tried driving an EV like the Leaf, or PHEV like the Chevy Volt??

        • ChiefEngineer says:

          Hi Ron,

          I believe the world will transform to EV’s over the next 15 years seamlessly because it will be cheaper and cleaner than oil. I also don’t expect oil production to peak until about 2020 to 2025 with oil production growth slowing before peak compared to GDP growth.

  33. Greenbub says:

    Shallowsand, maybe you can comment on this, they seem remarkably well-hedged to me:

    http://investor.sanchezenergycorp.com/phoenix.zhtml?c=248475&p=RssLanding&cat=news&id=2114300

    • John S says:

      And while you are at it, what are your thoughts on this bit of news about Chesapeake’s falling bond prices:

      http://seekingalpha.com/news/2941996-chesapeake-energy-bonds-plunge-to-lowest-ever-levels?app=1#email_link ; and then there is this little article about Continental Resources :

      Continental Resources’ Highly Suspicious Refusal To Impair Assets Makes It A Peer Set Outlier $CLR
      http://www.seekingalpha.com/article/3691886.

      • shallow sand says:

        Greenbub and John S. Will try to read those when get the time.

        Will say I still do not understand why CLR is valued so highly by Wall Street compared to its peers. I think if you go through their well by well inventory, in ND at least, you find much the same as I posted above on OAS.

        Now they seem to have pretty much abandoned ND and MT Bakken exploration for OK, but I have not figured out how that area is better economically. I posted about their Poteet multi-well project a few months ago. It is basically a Woodford gas and condensate play, with more expensive wells than Bakken, selling gas and NGls for a very low price (although CLR did NOT cash their gas hedges, so maybe that is why the focus for now). Very high decline on liquids, seems they were well under 100 bopd of 60 API liquids within a few months.

        CLR SEC PDP PV10 should be well south of long term debt when released in 2/16. To me, that means they are insolvent. Yet they have a tremendous enterprise value, close to $100,000 per flowing BOE.

        I have never gotten it. Maybe the stock price has held up so well because the majority is owned by one shareholder, Mr. Hamm.

  34. Greenbub says:

    Cross-post from Investor Village SDRL page:
    “Inside Isis Inc: The journey of a barrel of oil”
    http://ig.ft.com/sites/2015/isis-oil/

    • Longtimber says:

      UN pass rule a decade or so ago .. Jerrycan with a handle .. 25 liter MAX.

  35. R Walter says:

    Thank God it’s Friday.

    From an atheist’s perspective, Friday is finally here.

    There is an another terrorist attack today in Africa, so I guess the spacing is one week apart beginning 11-13-15.

    Next Friday is a big shopping day in the US, so the expected next terror attack would be somewhere on the North American continent, maybe a place that has French ancestry, next terror attack one of two places or both, New Orleans and/or Montreal. Time to up the number of targets.

    Then it’s off to the South American continent for the following Friday attack on another prime target in a South American city. Then hop the globe over to India and do the pre-planning for the following week four attack, can’t fall behind on the calendar of events, it all must be impeccable and meticulous.

    The guesses are as good as any, and don’t forget Paris, Texas.

    Can’t be all that much fun, if it is, it won’t last long.

    At some point in time, the ennui begins to takeover, all it becomes and is.

    Forget about it.

    Another 10,000,000 tons of oil will be gone at the end of the day that never ends. On top of that, another 20,000,000 tons of coal. A hefty supply, needed every day. A week without it, the effect it will have will finally sink in.

    For a Friday, it is going to be another hard day on the planet.

    • Fred Magyar says:

      Yep, TGIF,
      Major storms in Sao Paulo overnight so had no power or internet…
      Some places had tornadoes, very unusual weather, I’m sure none of it has anything to with climate change! Raining all day today but reservoirs are still low. C’est la vie! Mother Nature, when she is pissed can do a hell of a lot more damage than all the asshole religious fanatics of the whole world put together.
      Cheers!

      • oldfarmermac says:

        If it weren’t religious assholes, it would be some other variety.
        Nature abhors a vacuum, people do not give up their belief in God and henceforth believe in nothing.

        We are tribal monkeys and there will most likely always be leaders who can tap into our “us” and “them ” tendencies.

        It WOULD be nice though, if we were to get lucky and have an extended period when we all perceive ourselves as members of the SAME tribe.

        What we need to bring us together, nothing else is apt to work nearly as well, is a COMMON ENEMY.

        Bring on the unfriendly LITTLE GREEN MEN from Alpha Centauri.

        It is essential that the invaders be green, or at least for damned sure not white, black, yellow, reddish or any tint associated with any existing variety of human. LOL

        • Glenn Stehle says:

          OFM,

          Could global warming fill in for those “unfriendly LITTLE GREEN MEN from Alpha Centauri.”

          But even if it could, there’s no guarantee that it would trigger the right response.

          For instance, just look at the difference in the ways the US, as opposed to Germany (with its eugenics and scientific racism), attempted to solve its collective action problems during WWII.

          • Glenn Stehle says:

            ..

          • Glenn Stehle says:

            The United States even let this guy in, despite the loud objections of a group which called itself the Women Patriots, and he was:

            1) German
            2) A Jew, and
            3) An avowed socialist

            Imagine that!

          • Fred Magyar says:

            For instance, just look at the difference in the ways the US, as opposed to Germany (with its eugenics and scientific racism), attempted to solve its collective action problems during WWII.

            Glen, you are so full of it bro!

            http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2757926/

            U.S. Scientists’ Role in the Eugenics Movement (1907–1939): A Contemporary Biologist’s Perspective

            By the 1920s, three major efforts pushed the eugenic agenda in the United States and subsequently throughout Europe: (1) The Eugenics Research Association with Laughlin and Davenport as leaders and in affiliation with the American Association of the Advancement of Science (AAAS). (2) The American Eugenics Society founded by Laughlin, Harry Crampton, Madison Grant, and Henry Fairfield Osborn with the purpose of promoting the eugenical movement at both the scientific and popular level. (3) The Eugenics Records Office, directed by Davenport and run by Laughlin with the express purpose of providing the scientific data to support the eugenics movement.

            A concerted effort of this magnitude with the expressed support of the mainstream scientific establishment (e.g., AAAS as operator of the journal Science; the American Breeders’ Association, which later became the American Genetics Association; and the Carnegie Institution) had an effect throughout both the scientific and governmental establishments worldwide. Specifically, by 1936 when both England and the U.S. genetic scientific communities finally condemned eugenical sterilization, over 60,000 forced sterilizations were already performed in the United States on mostly poor (and often African-American) people confined to mental hospitals.9,10 The practice of forced sterilizations for the “unfit” was almost unanimously supported by eugenicists. The American Eugenics Society had hoped, in time, to sterilize one-tenth of the U.S. population, or millions of Americans.11

            • Glenn Stehle says:

              Well Fred, as the quote you cite points out, there certainly was “expressed support of the mainstream scientific establishment” for the science of eugenics during the first four decades of the 20th century. And this support was ubiquitous thoughout the Occidental world.

              Much more on the topic can be found here:

              “German science and black racism—roots of the Nazi
              Holocaust”
              http://www.fasebj.org/content/22/2/332.full.pdf+html

              But when the United States entered WWII on December 7, 1941, it made a hasty U-turn away from the science of eugenics, along with everything that motivated it, choosing to reject the view of the mainstream scientific establishment. Germany, on the other hand, took the exact opposite path, and pursued the consensus of the mainstream scientific establishment to its logical conclusion.

              So instead of rounding up non-whites, Jews and other “undesirables” and systematically exterminating them as Germany did, the United States put them to work, or to soldiering.

              Here’s how David Montejano tells it in Anglos and Mexicans in the Making of Texas:

              Social conflict and national crises provided the necessary impulse for the decline of old race arrangements. World War II, in particular, inititiated dramatic changes on the domestic front. The need for soldiers and workers, and for positive international relations with Latin America, meant that counterproductive and embarrassing customs of Jim Crow had to be shelved, at least for the duration of the emergency.

              And as Montejano goes on to explain, there was no going back to the pre-war ways after the war was concluded, at least on the domestic front.

              So why do you supposed it is that the United States decided to reject the mainstream scientific consensus and Germany did not?

              Did that decision have anything to do with enhancing the US’s role in winning the war?

              Many historians believe it did. Here, for example, is an example from C.L. Sulzberger’s History of WWII of where the science of eugenics, and the political philosophy it informed, played a decisive role in the allies winning the war:

              Many Russians greeted the Nazi invaders as friends come to free them from Stalinist oppression. Had the Germans fostered this initial good will, they might have won Russian support against the Communist regime; but in Nazi philosophy, with its fantasy of the master race, the Russians were Untermenschen — subhumans — fit only for slave labor. Hitler had ordered a completley ruthless campaign — and he was not disobeyed. Russian good will turned to hate. The people retaliated by wrecking troop trains, poisoning wells, murdering soldiers. At first these acts were scattered and spontaneous, but as Nazi repressive measures grew more savage, the resistance gradually took on organization and discipline. Very soon the partisans behind the lines were playing an important part in the war.

        • Synapsid says:

          Sorry OFM,

          Although we’ve found some thousands of planets orbiting other stars I’ve seen no evidence or report of a planet in the Alpha Centauri system.

          It’s not fair: The closest stellar system, with a G-class star that is almost a twin to our Sun (although it’s part of a binary) and, it seems, no planets.

          Not fair. Even one or two of DougL’s pulsars (neutron stars, anyway) have planets, of a sort.

    • Glenn Stehle says:

      R Walter,

      Yep, thank goodness it’s Friday.

      Yesterday I saw in the news where Bush, Rubio and Kasich are calling for deployment of more US boots on the ground in Syria.

      According to Scott Atran and Pepe Escobar (in his article published in Asia Times this week), that’s exactly what ISIS is angling for. ISIS hopes to gain two things:

      1) A great recruiting tool as it points to the infidels invadading the Middle East (one more time), and

      2) Luring the US and NATO onto a battlefield where ISIS knows it has the greatest advantage with asymetrical, guerilla-type warfare.

      And then there’s Trump. He wants to close all Mosques in the US and force Muslims to register in a national database that would be used to track all Muslims living in the United States.

      Ben Carson, not to be outdone in the Muslim bashing department, compared Syrian refugees to “rabid dogs.”

      http://www.cbsnews.com/videos/trump-draws-criticism-for-talk-of-database-to-track-muslims/

  36. AlexS says:

    According to the EIA weekly statistics, U.S. crude and condensate production increased by 86 kb/d over the past 4 weeks.
    Average output estimate for the first half of November is 9184 kb/d, 135 kb/d higher than in the EIA STEO monthly forecast for November

    U.S. C+C production: weekly vs. monthly estimates (kb/d)

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