IEA Projections and Peak Oil Politics

[Pele'sDaughter]

Maybe this should go elsewhere; couldn't decide.

Apparently, there's a global oil scam making Bernie Madoff look like a petty thief.

If serial entrepreneur and Seeking Alpha columnist Philip Davis is to be believed, the world is being scammed out of $2.5 trillion, 50 times greater than the sum Madoff took from the duped investors.

According to Davis, the scam starts in 2000 with the formation of the ICE - the Intercontinental Exchange. The ICE - founded by Goldman Sachs, Morgan Stanley, BP, Total, Shell, Deutsche Bank and Societe Generale - is an online commodities and futures marketplace that exists outside the US and operates free from the constraints of US laws.

After a Congressional investigation into energy trading in 2003, the ICE was found to be facilitating "round-trip" trades. This is where one firm sells energy to another, and then the second firm sells the same amount of energy back to the first company, at the same time and at the exact same price, as told by Davis.

No commodity ever changes hands

Quite shockingly no commodity ever changes hands, but the transactions still send a signal to the market, artificially boosting company revenue. Angry yet? There's more.

Because the trading is unregulated by Washington, its difficult to gauge the scale on which "round-trip" trading takes place.

But when DMS Energy were investigated by Congress, the company admitted that 80 percent of its trades in 2001 were round-trip trades. This means 80 percent of all trades in that year were false trades. Not a drop of oil changed hands, but the balance sheets showed increased revenue.

The idea is to hike up commodity prices. For example, according to Davis, after the ICE turned commodity trading into a "speculative casino game where pricing was notional and contracts could be sold by people who never produced a thing, to people who didn't need the things that were not produced", Goldman Sachs were able to triple the price of commodities in just five years.

ICE can create artificial shortages and drive speculative demand

The beauty (or rather the horror) of the scam outlined by Davis is that because they control the oil markets, the ICE can create artificial shortages and drive speculative demand in order to charge consumers an extra dollar per gallon of gas. And whereas this may not seem like much, this $1 soon becomes $50 billion A MONTH as global drivers consume 1.7 billion gallons of gas every single day.

Whereas, at this stage, it would not be accurate or indeed wise to suggest what Philip Davis claims is either true or false, one cannot ignore the issue. There have been concerns for may years that global markets are controlled by a monopoly of mega-organizations, but there could be a strong case for suggesting the ICE is close to becoming just that - a super-organization with the power to push oil prices up or down.

Good luck Washington, you might just be getting a deluge of mail demanding answers.

http://www.slideshare.net/theoilman/25- ... n-oil-scam

http://www.ngoilgas.com/news/25-trillio ... -oil-scam/

[JackRiddler]

Interesting when we consider the troubles involved in retail oil piracy, which takes less than 1/100000th of the $2.5 trillion the banksters reaped by letting computers execute round-trip deals for a few minutes a day. Following story complements the one from Pele's Daughter by showing us the emerging Mad Max scenario from a level closer to the bottom - that of the mere warlord:

November 18, 2009
The Case of the Purloined Petroleum
Hot Oil!

By JOHN ROSS

In a catchy photo op staged this past August, officials of the U.S. Department of Homeland Security are pictured handing over a four foot-long government check for $2.4 million USD to Mexican finance ministry officials as recompense for shipments of stolen Mexican oil smuggled into Texas right under the noses of U.S. customs enforcement officers and sold to Trammo Petroleum, a Houston transnational with branch offices in China, Brazil, Egypt, France, the U.K., and Switzerland.

Part of the shipment of purloined petroleum was then sold off to a German BASF subsidiary in Port Arthur for $2.4 million. According to the New York Times, the deal was brokered by one Josh Crescenzi, Rio Grande Valley supervisor for Continental Fuels and a bundler for former Texas oilman George Bush during his 2004 election campaign who is now in a federal protected witness program. Trammo CEO Donald Schroeder has pleaded guilty to receiving stolen property and will be sentenced in December.

The Texas case is, in fact, the tip of a sinkhole that involves tens of millions of barrels of stolen Mexican oil worth billions of greenback dollar bills, U.S. customs enforcement, corrupt oil union officials, dozens of mysteriously "disappeared" oil workers, and a dread drug cartel.

Mexican authorities calculate that more than 2,000,000 barrels are stolen from PEMEX, the national petroleum monopoly, each year by workers, company insiders, and organized crime. A 2007 New York Times investigation estimated that a billion dollars worth of Mexican oil was being siphoned from PEMEX annually through fraud, theft, and clandestine "tomas" ("takes") drilled into company pipelines. Thousands of gallons of jet fuel allegedly wound up in the tanks of drug cartel jets carrying cocaine in from Colombia for transshipment to the U.S.

PEMEX numbers (questionable at best) reveal that more than 1.5 million barrels were sucked out of the oil giant's pipelines in the first nine months of 2009 alone. A Mexican government investigation into one network of oil thieves operating in the Burgos sector along the border in Coahuila and neighboring Nuevo Leon states yielded 740,000 pesos in cold, hard cash and evidence of $46,000,000 USD in stolen oil sales, presumably to U.S. buyers.

The modus operandi of the petrol pirates is simplicity itself: "chupaductos" ("duct suckers") are attached to perforated pipelines and the oil pumped into tanker trucks or "pipas" that sometimes bear the PEMEX logo. Pipa drivers are provided with phony documentation from the Mexican Environmental Secretariat (SEMARNAP) attesting that the contents of the loads they are moving are liquid petroleum waste - the documentation is apparently good enough to satisfy the curiosities of U.S. customs inspectors.

Some of the stolen crude is processed at clandestine refineries into gasoline that is sold in both Mexico and the U.S. Gas stations in central Mexico, particularly in Puebla state, are ready customers for the hot oil if a recent article in the daily El Universal is to be believed. Major trucking and bus companies buy the purloined gasoline without any questions asked. A May 16th, 2008 raid by federal police agents at offices in Acolman, Mexico state resulted in the confiscation of documentation for dummy companies created to distribute the product.

PEMEX bulletins reported by El Universal establish that nearly half the stolen petroleum (48%) is sucked from pipelines that supply the country's six major refineries - Mexico, which has limited refining capabilities, sends most of its crude to Texas to be converted into gasoline that is then re-imported for domestic use.

22% of the "tomas" are tapped from two oil ducts feeding the Hector Lara refinery in Cadareyta, a city of 75,000 in central Nuevo Leon. Local papers report that PEMEX has shut down 33 "takes" in the Cadareyta pipeline network so far this year, most recently this past August 30th along the national highway in San Juan, one of dozens of tiny communities that pertain to the municipality. The perforated duct measures 24 inches around which experts say translates to a lot of petroleum.

Who is stealing Cadareyta's oil? One PEMEX investigation suggests the involvement of organized crime, most pertinently the Zetas, a ruthless band of narco traffickers, who began life as the dreaded enforcers for the Gulf Cartel. Noted for their expertise in beheading their rivals, the original Zetas were Mexican Army officials trained in drug war strategies at the Center for Special Forces in Fort Bragg, North Carolina. Bored with protecting the interests of Osiel Cardenas, the Gulf Cartel capo who is now facing 30 years in the U.S. super-maxi penitentiary in Florence Colorado, the Zetas have gone into business for themselves and are now assigned full-blown cartel status by Mexican drug fighters. More than a dozen Zeta offshoots now operate throughout Mexico and the cartel is diversifying into extortion, kidnapping, pirate goods, and the sale of stolen oil.

With 2000 members, Section 49 of the Sindicato Mexicano de Petroleros de la Revolucion Mexicana (STPRM) which holds the contract for the Cadareyta refinery is notorious for corruption and gangsterism. Up until 2007, the section was controlled by ten brothers named Vega, disciples of STPRM boss Carlos Romero Deschamps. In fact, Hilario Vega, then in his third term as secretary general of Section 49, was considered Romero Deschamps' heir apparent when leadership of the union devolves to northern sections of the STPRM in 2012. One ex-Cadayreta worker, Tony Cantu, interviewed by the New York Times' Tim Weiner, testified that the Vegas were perfectly capable of killing dissidents to protect their concession - Cantu now lives in Houston. Hermen Macias, a Cadareyta newspaper editor who dared to cross the Vegas, claims he was repeatedly threatened with death before the union bosses began to mysteriously disappear.

The Vega brothers' enterprise began to unravel some 30 months ago when, on May 16th 2007, David Vega, AKA "El Ganso" ("The Goose") left a union meeting in high spirits with three fellow oil workers - the four reportedly had been plotting strike tactics if then-upcoming negotiations with the PEMEX refinery division fell through. But David Vega and his three companions never returned home. One unidentified eye-witness to their forced disappearance or "levanton" ("pick-up" in narco parlance) reported that the petroleros were waylaid by a commando of men dressed in black uniforms with no insignias and bullet-proof vests and carrying automatic weapons with grenades strapped to their belts - an outfit that fits the Zeta dress code - and spirited off in several large black cars.

More
http://counterpunch.org/ross11182009.html

.

[jingofever]

The SEC now allows oil companies to make up their proven reserves:

Up until now, oil companies needed to actually prove they had reserves before they reported proven oil reserves. Now, however, the SEC is allowing them to use internal, proprietary computer models to essentially pull their “proven reserve” numbers out of thin air (or the nearest friendly Monte Carlo simulation).

[JackRiddler]

Thanks to seemslikeadream!

IEA Whistleblower Claims Agency Has Downplayed Looming Oil Shortage

According to a senior International Energy Agency official, the energy watchdog agency fears the truth would trigger panic buying
By Jeremy Hsu


Energy Numbers Whistleblowers have added to outside criticism of the IEA's energy figures for the future IEA

A senior official at the International Energy Agency turned whistleblower just prior to the release of a major IEA report, and claimed that the international organization has downplayed a looming oil shortage to appease the U.S. and prevent panic buying.

The anonymous whistleblower apparently told his story to The Guardian on the eve of the new World Energy Outlook report that went public Tuesday. He alleged that the international watchdog has bowed to U.S. pressure to underplay the decline of existing oil fields and overplay the possibility of tapping new fields.

Outside economists and energy experts have already criticized a figure within the new report that states oil production can grow from 83 million barrels per day to 105 million barrels per day by 2030.

The whistleblower added that the IEA had already dropped its 2030 estimates from 120 million barrels a day to 116 million, and then 105 million. He also said that many IEA members believe maintaining oil supplies at just 90 million or 95 million barrels per day seems impossible.

These claims seem backed by a second IEA source who has already left the watchdog agency, but similarly wished to remain anonymous. He told The Guardian that the IEA had a rule of not angering the U.S., and affirmed that the world has already entered the peak oil zone.

Whatever the case with the actual oil production figures, the IEA report seems sobering enough in its predictions. The IEA predicts that the world needs to invest $26 trillion through 2030 for new energy projects to meet growing demand, and another $10.5 trillion toward mitigating greenhouse gas emissions. To the guys and gals meeting at Copenhagen in December and hoping to tackle the issue of climate change, we say "No pressure."

But seriously, almost everyone not hiding in a cave recognizes that our cars and homes won't run on fossil fuel energy sources forever. That's why we created PopSci's realist roadmap to 2050 for energy. It's also why the U.S. Department of Energy's new mad science lab has begun spraying funding in all directions for breakthrough technologies that could boost energy efficiency and improve renewable sources.

[JackRiddler]

Bumping a favorite thread after Hugo Farnsworth linked to it today.

The chart is effectively IEA's admission that they think peak oil is happening. The currently active fields recede dramatically. The soon-to-be active fields recede before 2020. The about-to-be discovered fields are speculation, placeholders to create the appearance that the amount of conventional oil will remain level. The increase shown above that is shale (a disaster).

[JackRiddler]

Assimilitating post today by wintler2, so that we maintain an archive...

Very interesting to compare this year's chart of projected output to last year's! Suddenly natural gas production does not increase from 2010 levels, the present fields decline more dramatically and the total hydrocarbon output stays under 100 mbd through 2035.

The IEA has admitted reality (pdf exec summary of 2010 world energy outlook) of peak oil, puts peak of conventional oil extraction back in 2006.

The figure worth a meg of words is..

from IEA slides
Increased production from unconventional gas and oil is supposedly going to make up for oil's decline. And candy is an equally perfect substitute for complex carbohydrates.

Nice little u-turn the IEA has done in last decade, from 'don't be so ridiculous' to 'yes, 4 years ago'. There is really nothing so significant, these days, that it can't be revealed and stay hidden in plain sight.

[wintler2]

I'm fine to use this thread JR, but would like a more topical title. That the offical view has become that we're post-peak is pretty significant, much moreso than whether any one country tried to fudge the numbers.

If we're thinking archival, should include Peak Oil thread, & i'll slip in a vanity mention for this blast from the past: Peak oil is a scam? Prove it..

[JackRiddler]

.

Well, can a barracuda change the title to "IEA Projections and Peak Oil Politics" and is jingofever's permission required for such a worthy purpose a year since we started? Cause it really is better to group it and keep a record over time, for most subjects.

.

[Allegro]

.

Well, can a barracuda change the title to "IEA Projections and Peak Oil Politics" and is jingofever's permission required for such a worthy purpose a year since we started? Cause it really is better to group it and keep a record over time, for most subjects.

.

Agreed, and Thanks, JackRiddler. Also, JackRiddler similarly mentioned here.

[wintler2]

New York Times article on same IEA report: In Global Forecast, China Looms Large as Energy User and Maker of Green Power
No mention, none, of oil peak, decline or depletion.

Huffington Posts Bill Chameides is little better, making it all a story about IEA being pro a carbon tax

Peak Oil Finally Piquing Analysts?
..
IEA Jumps on the 'Peak Oil' Wagon in 2008
IEA's about-face began two years ago when, in a departure from its typically confident projections for petroleum supply, the organization reported that fields were declining at double the rate of earlier projections and projected that conventional oil would peak in 2030. Previously, the idea that oil supplies might one day peak had been "dismissed," to quote one reporter referring to IEA's 2005 report. The IEA's executive director even went on record referring to those concerned about peak oil as "doomsayers." Not so anymore ... especially for petroleum -- the scarcest of fossil fuels. By some reports it took a whistle-blower at the IEA to get the agency to fess up about impending oil shortages. But that was a couple of years ago. Flash forward to 2010.

IEA Bids Farewell to Cheap Oil This Year
IEA's three-volume, 700-plus-page outlook for 2010 is hot off the presses, and one of its major conclusions [pdf], once again, is that the age of cheap oil is behind us. It's a perfect storm headed our way -- a steady rise in global demand for oil crashing up against an increasingly limited supply of economically recoverable oil. By 2035, the group projects, demand for oil will increase from about 84 million [xls] to 107 million barrels per day, and prices will rise to $135 per barrel -- a range we painfully visited briefly during the spring and early summer of 2008. (The current price of oil is about $80 a barrel.)

But There Is a Potential, if Surprising, Fix
That's definitely going to put a sizable dent in our wallets and end up sending a lot of dollars to foreign shores. But the IEA points out that there is one way to get off the oil-price roller coaster. If we enacted policies to reduce greenhouse gas emissions (and promote renewable energy), demand could be as much as 10 percent less, a prospect that would in turn reduce each barrel of oil by about $20 in 2035.
..

The Oil Depletion Protocol would be a much better fix than more rationing by price (carbon tax), but theres much less profit in it for bankers & industry. Betcha we get sold a carbon tax to 'fix' AGW & PO both, when really it'll just reserve the last of the easy energy for the rich.

Treehugger has a flash of insight (IOW they agree with me )

..Given that the disruption to the global economy that would result should those supplies not materialize at all be hugely catastrophic (the German military spoke of global economic collapse, in recently revealed reports), it somehow feels like this chart has been produced to assuage fears and play down the fact that sooner than we'd like and are prepared for, oil is likely to become much less abundant.

[TVC15]

New maritime oil field discovered in Dubai

United Arab Emirates: Thursday, February 04 - 2010 at 13:07
The Dubai government press office has released a statement saying that the emirate's ruler, Sheikh Mohammed bin Rashid Al Maktoum has informed ministers and the rulers of the other emirates that a new maritime oil field has been discovered east of Dubai's Rashid field. Instructions have been given for exploration to begin on the field in order to gauge its size.

Oil discovery in Falklands hailed as biggest of its kind since North Sea oil
By KATHERINE FAULKNER
Last updated at 8:02 AM on 5th June 2010
Comments (55)
Add to My Stories

An oil field discovery in the Falklands was hailed yesterday as potentially the biggest discovery of its kind since North Sea Oil.
Shares in Rockhopper exploration soared 52 per cent yesterday as the company said it expected to pump out at least 242 million barrels of oil from the 'Sea Lion' well - the expedition's first major oil find.
And some predicted there could be millions more barrels of oil lying untapped in the area - sparking hopes that the region could hold as much oil as the North Sea.


Read more: http://www.dailymail.co.uk/news/worldne ... z15GqCyt9T


Latest Brazil Oil Find Could Be World's Largest In 20 Years
Article
Comments
MORE IN BUSINESS »

RIO DE JANEIRO (Dow Jones)--The latest oil and gas find in Brazil's ballyhooed presalt offshore region could be the biggest yet discovered in the world's pre-eminent deepwater frontier, and perhaps the largest the world has seen in two decades, a government official said Monday.

The Libra prospect is estimated to hold reserves of between 7 billion and 8 billion barrels of oil equivalent, Marco Antonio Almeida, the secretary for oil, gas and renewable fuels at Brazil's Mines and Energy Ministry, told the Rio Oil & Gas 2010 conference.

...


Russia: PetroNeft Resources announces new oil field discovery at Arbuzovskaya in Licence 61

09 Nov 2010

PetroNeft Resources, the owner and operator of Licences 61 and 67, Tomsk Oblast, Russian Federation, has announced the discovery of a new oil field at Arbuzovskaya in Licence 61.

Highlights:

Arbuzovskaya No. 1 well discovers oil in main Upper Jurassic target
Approx. five metres of net oil pay in J1 interval
Open hole inflow test of 289 bopd (unstimulated)
Drilling continuing with secondary targets of Middle and Lower Jurassic


Massive Oil Deposit Could Increase US reserves by 10x

America is sitting on top of a super massive 200 billion barrel Oil Field that could potentially make America Energy Independent and until now has largely gone unnoticed. Thanks to new technology the Bakken Formation in North Dakota could boost America’s Oil reserves by an incredible 10 times, giving western economies the trump card against OPEC’s short squeeze on oil supply and making Iranian and Venezuelan threats of disrupted supply irrelevant.


Dana Makes New Oil Field Discovery In Egypt
EBR Staff Writer
Published 30 July 2010
Dana Petroleum's Fin-1X exploration well has discovered a new oil field at the North Zeit Bay Production Sharing Contract (PSC) area onshore in the Gulf of Suez in Egypt. This follows the discovery of the Lorcan oil field, made last month in the same PSC area.

Dana is the 100% stakeholder and operator of the Fin-1X well, which was drilled to a depth of 10,038ft. The well encountered good quality oil bearing sands in the Kareem formation in line with the company's prognosis prior to drilling.

During the drill stem test, the Fin-1X well flowed strongly with high downhole pressures, delivering an average flow rate of 1,049 barrels of oil per day through a 52/64" choke. The flow rate during this test was restricted by the temporary flow testing facilities and the requirements to truck the produced oil from the desert

New Oil Field Discovered in Afghanistan
By Resa Xu
Epoch Times StaffCreated: Aug 16, 2010 Facebook Digg StumbleUpon Twitter | |
Related articles: World > South Asia A new oilfield discovered in northern Afghanistan is estimated to contain 1.8 billion barrels of oil.

Afghan and international geologists discovered the deposit, located between Balkh and Shiberghan provinces.

"I do not know its price in the market. But the initial survey says there are 1.8 billion barrels of oil and I think there will be more than what it is estimated," stated Jawad Omar, a spokesperson for the Ministry of Mines according to Reuters.

Last year, geologists estimated that Afghanistan had about $1 trillion worth of mineral resources, but tapping these resources could take decades and would require peace with the Taliban.

Major New US Oil Discovery Sixth Largest In History
May 27th, 2010 | Author:Sunshine | Business, Science, Uncategorized | Comments Off


The Eagle Ford shale, a deep rock layer in South Texas that spans several hundred miles from near Mexico to East Texas, is being hailed by some experts as the sixth largest oil discovery in U.S. history. This major new U.S. oil discovery holds literally billions of barrels of crude and has the advantage of being on land, at a time when the prospect for drilling in the Gulf of Mexico is looking bleak for oil companies.

[JackRiddler]

New maritime oil field discovered in Dubai
Instructions have been given for exploration to begin on the field in order to gauge its size.

Oil discovery in Falklands
was hailed yesterday as potentially the biggest
Shares in Rockhopper exploration soared 52 per cent
at least 242 million barrels of oil from the 'Sea Lion' well [3 days of current global consumption!!!]
some predicted there could be millions more
sparking hopes that the region could hold as much oil as the North Sea.

[fucking pessimists - my sparked hopes say it could be bigger than Saudi Arabia and Iraq combined.]

Brazil Oil Find Could Be World's Largest In 20 Years
in Brazil's ballyhooed presalt offshore region
could be the biggest yet discovered
and perhaps the largest
a government official said Monday.
is estimated to hold reserves of oil equivalent

PetroNeft Resources, the owner and operator announced
main Upper Jurassic target
Approx. five metres of net oil pay in J1 interval
Open hole inflow test of 289 bopd (unstimulated) [bopd=barrels of oil per day]
Drilling continuing

Massive Oil Deposit Could Increase US reserves by 10x
America is sitting on top of a super massive 200 billion barrel Oil Field
that could potentially
could boost America’s Oil reserves by an incredible 10 times

new oil field onshore in the Gulf of Suez in Egypt.
Dana is the 100% stakeholder and operator of the Fin-1X well
delivering an average flow rate of 1,049 barrels of oil per day through a 52/64" choke.

Discovered in Afghanistan
Epoch Times [Falun Gong apocalypse Christian paper]
estimated to contain 1.8 billion barrels of oil.
initial survey says
I think there will be more than what it is estimated,"
stated Jawad Omar, a spokesperson for the Ministry of Mines [invest today! he added]
geologists estimated that Afghanistan had about $1 trillion worth of mineral resources

Major New US Oil Discovery Sixth Largest In History
The Eagle Ford shale,
is being hailed by some experts
as the sixth largest oil discovery in U.S. history.

...

Press release by oil company raises share price! Buy! Buy!

Statements by spokespersons of government oil ministries! Invest now!

Unsubstantiated breathless speculation by pretend press (Epoch Times?!)

Add some salvation promises by would-be future wasters of the Dakotas.

Massive hype on discoveries of small amounts.

Offshore in Arabia.

Shale.

-- all of which tell you that the low-EROEI, easy quality stuff on land has peaked and is in decline. As often the case, the evidence supporting peak oil is presented as though it were the opposite. Consumption (rising) outpaces by a growing factor discovery and ability to turn it into daily flow. (Plus discovery is in shale and offshore, boosting the eco-disaster.)

Global consumption:
85 million barrels of oil per day. (US: 20.7 million, EU: 14, China 7.5, Japan 5)
31 billion barrels per year.

I'm more impressed by energy savings. (Start with the elimination of 800 overseas bases and 12 carrier groups.)

If you extended your oil company PR survey back in time by a few decades, what do you believe the cumulative ratio would be between the hyped estimates on the day of announcing discovery, and the actual output (in EROEI, please) before the field is abandoned?

.

[norton ash]

Pie in the crust.

[jingofever]

New York Times article on same IEA report: In Global Forecast, China Looms Large as Energy User and Maker of Green Power
No mention, none, of oil peak, decline or depletion.

The New York Times did cover the peak at their energy and environment blog. Important enough for a blog post but not an article. It's just the decline of industrial civilization after all.

[JackRiddler]

.

Mike Ruppert is smiling at his new site, http://www.collapsenet.com.

Just saying in the way of kicking this thread.

.