It's hard for me to ignore these assumptions. Refineries don't get built because of NIMBYism and , to some extent, regulatory expense. Arianna Huffington even pointed out that some oil companies have pushed to get each others refineries shut down by regulators, to keep the price of refined products high. There's also a high degree of NIMBYism and regulatory obstruction in pipelines and supertankers as well. I HAVE invested in refinery and tanker stocks - and I can affirm that they can be extremely volatile, with long periods in which valuations sit at the bottom of the market. Pipelines and tankers still would be needed if synthetic/alternative fuels are developed - and there's lots of possibility in that field.
The Wall Street Journal has pointed out more than once that disinvestment in the oil industry and alternative energy is because of the Saudis, dominately. No business wants to invest in anything that could be wiped out over night by sheiks who could simply turn a spigot and pump oil for the cost of running the machinery. You have to be very motivated or crazy to invest in such an atmosphere. This fact is also why oil has remained relatively cheap in real dollars until recently - the Saudis aren't complete fools and have maintained prices that inhibit alternative development. With China and India in the mix, we now may be able to get beyond the Saudi economic veto that has afflicted alternatives. There also may be a long gap in oil well development, after so many years of neglect, based on volatile prices that inhibited the process. In upstate NY, Fortuna is on a well drilling binge BECAUSE of the price of natural gas. Since such is the case in an area as unlikely as upstate NY, I can safely assume that the rest of the world will see a similar explosion of development. -----Original Message----- From: Jed Rothwell [mailto:[EMAIL PROTECTED] Sent: Tuesday, November 22, 2005 2:58 PM To: vortex-L@eskimo.com Subject: Re: Peaked Oil (was: challenging papers) [EMAIL PROTECTED] wrote: >There is a good reason why noone is building new refineries. This is exactly right. See K. Deffey's new book, "Beyond Oil." No new refineries, supertankers or pipelines are on order because the oil companies know they will have no use for them. One of the reasons OPEC members overstated their reserves is because their quota was based on their reserves, not their actual production at the moment. - Jed
