Doug Henwood wrote:
On Aug 24, 2006, at 3:10 PM, raghu wrote:
The funny thing about this argument is that it assumes the
*existence* and availability of such "storage facilities".
The EIA releases those numbers for the US every week <http://
tonto.eia.doe.gov/dnav/pet/pet_sum_sndw_dcus_nus_w.htm>. There are
over 1.7 billion barrels of crude & products in inventory. The
markets take these weekly releases seriously. So it's not magical
neoclassical assumptions.
Doug
But seriously:
The markets take these weekly releases seriously...
.
The 'market' does seem to be 'seriously' ignoring a crumbling
infrastructure.
BP Alaska production cut some more
Prudhoe Bay output, already halved, now faces loss of 90,000 bpd due
to compressor problem.
August 24 2006: 9:49 AM EDT
.
There must be some 'efficiency' to it that I'm not seeing: Although I
did see an article the other day showing (to the best of my
recollection) oil company profit margins at a historical high.
Where ARE the capital expenditures on infrastructure? Why aren't oilco
investors requiring the companies to invest in equipment to keep the
source of profits flowing?
I think the answer is linked to whether the infrastructure needed is
convertible (rapidly) to LNG, and 40-50 years later, some other product
used to literally 'fuel the economy'?. I think not. Some, but there is
quite a difference between liquid(oil) now and gas(LNG etc) 50 years
from now.
Will the oilcos even be playing the enegy market 100 years from now?
Hard to tell, but I smell rats, and they act like they are leaving the
'ship' on a long-term timeframe... or waiting for that jumbo-sized
government bailout.
Leigh
http://leighm.net/
