Oil Prices Now

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begreen

Mooderator
Staff member
Nov 18, 2005
88,872
South Puget Sound, WA
The point where it get real interesting is when folks buying

The Us Military is actual spending a lot of money on bio based fuels. There are plenty of options, they are just not cheap.
But they are attractive. An EV has a lower heat signature and is a lot quieter.
 

begreen

Mooderator
Staff member
Nov 18, 2005
88,872
South Puget Sound, WA
Once upon a time we were energy independent , like two years ago
Promise made in 2008. Between 2008 and 2015, American oil production increased by 88%, the fastest increase in history. By 2016 we were seeing the biggest oil boom ever in the US.
 
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blades

Minister of Fire
Nov 23, 2008
3,666
WI, Leroy
Won't see that again as the banking area has significantly changed their policies-
 

Sodbuster

Minister of Fire
Sep 22, 2012
1,506
Michigan
Please correct me if I'm wrong, but i remember reading that under $60 a barrel, US production wasn't profitable. It would be nice to pull our service members home rather than protect the free flow of oil.
 

blades

Minister of Fire
Nov 23, 2008
3,666
WI, Leroy
Please correct me if I'm wrong, but i remember reading that under $60 a barrel, US production wasn't profitable. It would be nice to pull our service members home rather than protect the free flow of oil.
careful you are going to let the cat out of the bag as it were. Ref. last sentence.
 

SpaceBus

Minister of Fire
Nov 18, 2018
6,081
Downeast Maine
I bet taxpayers would rather have the boots on the ground protecting the flow of oil rather than pay $12/gallon of gas.
 

clancey

Minister of Fire
Feb 26, 2021
1,251
Colorado
What we should be thankful for paying less than other countries when we all at this moment in time lost money out of our pocket that we should not have lost...Its going to have a very large impact on all products across the board especially shipping that is too high now..Not only that we might have to depend on people in the future who are not our friends for we are not self sufficient no more nor can we have enough to sell at a good price to other countries.. Yes one hundred dollars a barrel real soon--give it time...clancey
 

peakbagger

Minister of Fire
Jul 11, 2008
6,400
Northern NH
OPEC and the non aligned countries have a window of pricing they need to hit. Many oil regimes use oil dollars to prop up political support at home by subsidizing commodities and social programs with oil dollars. They plan on minimum oil price, if they go below they have to cut back on social programs and subsidies and the natives get restless. There is also a upper limit, shale, unconventional oil and tar sands get profitable and the oil fleet goes out back in the fields. That is around the $100 mark . It does not happen instantly so in the short term price swings up due to supply imbalances but OPEC and others realize that they need to pump more oil into the market in the short term to let prices float down so the US and Canadian capacity does not decide its trend and head back in the fields.

The other aspect is global warming, transportation fuel is huge chunk of the problem, cheap gas means lots of gas hogs get bought. Let the price drift up for the long term to the point its a bit more painful, then fewer gas hogs get sold. Ideally if a politician can blame normal market forces its the way to go. The Europeans have heavily taxed gas for decades as a means of forcing conservation, the US will also need to do it either directly or indirectly to meet global warming commitments. The alternative is gas guzzler surcharges to the car industry, if someone really wants a gas hog they pay a surcharge and the surcharge goes to subsidize fuel efficient cars or electric cars. I previously owned a Ford Fiesta, Ford admitted they lost a couple of thousand bucks for everyone they sold but the high fuel mileage allowed them to sell a couple of more big Ford trucks.
 

bholler

Chimney sweep
Staff member
Jan 14, 2014
24,962
central pa
What we should be thankful for paying less than other countries when we all at this moment in time lost money out of our pocket that we should not have lost...Its going to have a very large impact on all products across the board especially shipping that is too high now..Not only that we might have to depend on people in the future who are not our friends for we are not self sufficient no more nor can we have enough to sell at a good price to other countries.. Yes one hundred dollars a barrel real soon--give it time...clancey
The only reason we may not be oil independent any more is due to the extremely low price of oil previously that made oil companies cut production because it wasn't profitable. As price goes up so will production.

And btw there are no numbers out that say we are not oil independent. While production dropped allot during the pandemic consumption did as well.
 

bholler

Chimney sweep
Staff member
Jan 14, 2014
24,962
central pa
I guess the passing of time will set the situation in full display. Time will tell...clancey
A look at history and an understanding of the actual issues at play gives you a pretty good idea of what will happen
 
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ABMax24

Minister of Fire
This time around the market is different, capital isn't as readily available to drill and develop new wells. Ever more stringent environmental regulations are making building infrastructure like pipelines ever more difficult and the process more lengthy, a change in US politics has moved from the goal of plentiful cheap oil to reductions on production and movement toward alternatives. OPEC has welcomed Russia into their organization to become OPEC+ further increasing their control of world oil prices, I don't believe their goal any longer is to try and squash the North American oil producers, the environmental movement will complete this task for them. OPEC+ has just agreed to slowly increase production by 2 mmb/d by the end of the year, which leaves total OPEC+ output 3.5 mmb/d below pre-covid levels, which points toward looming supply shortages.

What I know here in Canada is oil production will never significantly increase from current levels. Western Canada is flooded with oil we can't get rid of, the Transmountain pipeline is the only hope to increase our access to markets, and this is under construction by the federal government and will certainly miss it's opening date in 2022, if it ever does ship a drop of oil. The oil sands will maintain production, but another open pit mine will never be built, the federal government has somehow got its hands deciding approvals of these projects, which has added years to an already lengthy process, the last mine application was withdrawn without a decision. I don't expect any investors to ever apply for a permit for a new mine. SAGD operations will continue to be developed in the oil sands, but again hampered by access to pipeline capacity to ship the product out of Canada. Add to this a carbon tax and production costs jump up a bit slowly over the next 10 years, to the point long term projects are being shelved or at least reconsidered. Active drilling rig counts in Western Canada are extremely low considering the higher oil prices, which currently stand at 138, normally at this price there would be around 400 active rigs.

In the US the last Shale Oil boom created a few winning oil companies, and a whole bunch of bankrupted losers, making banks and investors leery of tempting fate on US oil again. The anti-fracking group continues to grow which has significant effect on the development of shale oil. Now politicians are attempting to overstep their bounds and regulate oil and gas infrastructure (think Michigan's Governor and Enbridge Line 5).

Long story short I'm skeptical that North America has the ability to quickly bring on line new production to absorb the post-covid surge in oil demand, and from what I'm seeing in my own backyard this statement so far holds true, new investment is barely trickling in. As an investor I'm very bullish towards high oil prices, I think demand outstrips supply by the end of the year, I see $80 oil this summer, and I think it's a probable bet to see $100 oil by Christmas.
 

BCC_Burner

Feeling the Heat
Sep 10, 2013
444
Uptown Marble, CO
While we're throwing out anecdotal evidence about future demand for fossil fuels, I think it's worth noting that electric vehicles are rapidly becoming mainstream.

Of the 5 or 6 people I know who have purchased new cars this year, not a single one of them bought a vehicle with an ICE, and that is living in a cold, snowy, mountainous area where people regularly commute 100+ miles per day. These are not urban runabout vehicles.

By 2030, I bet more than 50% of the vehicles sold in the US will be fully electric or plug-in hybrids with small ICE's that sip gas a miserly rate.

Personal transportation is going to change more in the next decade than it has since large-scale production of the automobile in the early 20th century.

It's going to be awfully hard to charge a whole lot of money for something that is going to be needed in smaller quantities by fewer people. I live in a town where it's legal to ride atv's and sxs's around on town streets, and I'll be waiting to buy an electric quad myself. Hate the noise and smell of those things.

We can't be done burning fossil fuels for personal transportation soon enough. There are other, better uses for those raw materials.
 
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peakbagger

Minister of Fire
Jul 11, 2008
6,400
Northern NH
I tend to agree with you, the trend is towards electric vehicles. Once the F150 electric trucks start getting shipped I expect a lot of truck folks may make the switch. Battery tech is getting better. I think ICE vehicles will remain for long haul use but they and their fuel will be at a premium. One thing many folks dont realize is that with a bit of software tuning electric vehicles can have a lot of torque and speed off the line. I am still getting used to my Toyota plug in hybrid, when I stomp on it it really moves. 5.3 seconds zero to 60 is quick.

Battery tech is getting better exponentially and my guess is companies will offer longer range batteries as an option like Ford and Tesla are doing now. The actually running gear is far less costly to the manufacturers and as battery size shrinks packaging is easier, my guess is at some point battery vehicles will be less costly. Folks are freaking out over the F150 Lightning front trunk (FRUNK) and expect once they start designing trucks for electric only the looks may change(hopefully Tesla eventually removes the packaging off their truck;) )

I figure by the time my plug in hybrid needs to be replaced in 6 or 7 years, the fully battery options will be even more attractive for the rural dweller like me. I still need an ICE for long trips as the 150 mile Tesla Supercharger boosts would really mess up long trips for me.
 
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clancey

Minister of Fire
Feb 26, 2021
1,251
Colorado
Our whole society will change on the way we do things in the future especially transportation. I love my electric lawn mower because of it being so clean and quick and good at mowing and when I store it --it is safe for the wintertime with no smell. These new vehicles in the future with electric are wonderful and I can imagine just a truck driving down a street with no person in it just computer ran. I can imagine ordering a car and going anywhere you want by just putting in the information on where you want to go---how nice especially for seniors. But on the other side I am sure there are downsides to this as well environmentally. Everything has downsides. I could get into more details but I need to "cool it" because of being censored and being accused of being part of "the fringe"--lol lol How far from the truth... We all have our different views and it is so interesting to read about all your different "takes" on this subject...I am looking forward to the electric vehicles and they will certainly enhance society and the clean air aspect of it as well as being quiet and quick with movement...Oil and gas have their purposes---many purposes--not only with "transportation" but it has made our country the greatest country in the world and brought so much technological advances to civilizations and life has been made into a easier living . So I will not knock "oil and gas" at this point and I will thank God that we have it so that we can perfect the wonderful new vehicles that are coming in the future...Our oil prices are raising rapidly and this will make everything rise in the future and this rise in prices is only the beginning. If your standing in your kitchen so to say---everything in that kitchen would disappear ----no stoves, so iceboxes, no sinks or plumbing,,,no flooring, etc etc --on and on so and these things need to be thought about with all of this discussion about the price of oil in my opinion., not just one aspect of it where just electric vehicles are discussed...Hold tight your money for higher "everything" is coming especially "oil and gas"...clancey
 

SpaceBus

Minister of Fire
Nov 18, 2018
6,081
Downeast Maine
I really can't wait for electric tractors, ATVs, etc.
 

begreen

Mooderator
Staff member
Nov 18, 2005
88,872
South Puget Sound, WA
I love electric cars and drive one. However, without a dramatic shift in building out infrastructure for alternative energy and a dramatic increase in safe nuclear plant building, I don't think we will not be able to make the transition to support the huge shift off of fossil fuels quickly enough. This should have started at least a decade ago.
 

fbelec

Minister of Fire
Nov 23, 2005
3,025
Massachusetts
i agree with you begreen. our power plants are running at almost 100% if we start throwing battery charging into the mix we will have what has been done before, rolling black outs. i thought that the way everything from kitchens appliances to light bulbs are energy efficient the home might not need 200 amp services they would stay at 100, but now i think that if the normal household has 3 cars charging at once we are going to be looking at 400 amp services for the simple home. for example if a house had 3 tesla's just in charging there would be 150 amps running never mind air conditioning and the normal house electrics. the power generators would not handle the load and we would have generation issues. it takes years to build a generating plant and fuel to run them. just my thought as a electrician.
 
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peakbagger

Minister of Fire
Jul 11, 2008
6,400
Northern NH
To throw a bit of reality in the doom and gloom, charging demand is related to miles driven. Lets run some numbers. Assume a typical commuter drives 40 miles round trip a day. Multiply by 5 days a week 50 weeks a year and get a nice round 10000 miles per year. My plug in AWD Rav 4 SUV gets about 3 KW per mile (with a 45 mile electric range). So I need 120 KW every day to recharge overnight for a 40 mile range. Lets make it simple and assume 12 hours of plug in or 10 KW per hour (KWH). I have a Level 1 charger (120 volts) and typical efficiency is wall to battery is 85% so I really need roughly 12 KW. 12 KW equals 12000 watts, divide by 120 volts and I need 100 amps of power over 12 hours of charging or 8.3 amps per hour. So the dire predictions of massive power demand for charging doesnt line up with reality.

The grid has lots of extra capacity, it just does not have peak capacity. In areas where solar generation is big part of the power mix there is the dreaded "duck curve" where solar generation has covered a lot of daily power demand but around 3 PM to 8 PM the solar is ramping down but the demand is going up to cover AC, dinner hour and evening loads (dishwashing and laundry). In the vast majority of the US the price of power is the same 24/7 even though the cost to generate that power varies wildly during the time of day and time of week. So the big trick is to shift the extra power demand from times of high power demand to low power demand so the grid doesnt need to be oversized to handle the peak and idle the rest of the time. The way to do this is peak power pricing. Vary the price of power to line up with demand. This used to be tricky as meters were "dumb" they just added up how many KWH used between meter readings by the guy in truck.

Much of country already has smart meters that talk to the power company and most homes have internet service even if they do not they have access to cell networks. So most of the parts are in place to put in peak power pricing. So when the demand for power is high, charge more for it and charge less when its not in demand. Some utilities in California have up to 5 power rates depending on system demand. There is feedback to the consumer so they know when the power cost is high so they can voluntarily push their power use into the low rate periods. With basic IOT (internet of things) systems in many homes (think Alexa and Apple products) many appliances already have the brains to be switched on and off remotely and tying this to power demand is pretty simple. My Rav4 has an ap that can turn the charger on and off and that comes in via the internet. I have a dumb meter so no incentive for me to hassle with it, but if the power company gives me the incentive to do so I will go to the trouble to figure it out. Even if I have dumb appliance there are plug in or wire in boxes to cycle their power remotely. I have a dumb freezer. It can go without power for hours. If someone pays me to have it cycle off on occasion during high power and its transparent to me I will do so. All that is needed is a sensor to detect that its temp is rising to the point where the remote off is overriden.

One of the other big technology leaps is to add storage to the grid so that power is stored when its not needed and put back in the grid when it is. This deals with the Duck curve. There are a lot of storage options some currently deployed and some waiting to be employed . Put the right incentives in place and storage gets built. Massachusetts is putting in "clean peak" standard which is giving incentives to have batteries installed so when the demand for power from the grid is nearing its peak that battery systems will pump power back into the grid. Right now those batteries are fixed in place but the capability to have an automotive battery to pump power back into the grid is getting close.

Many EV folks have installed solar panels to generate the power for their EV. Using my example for battery charging 12KWH per day in my location in northern NH, I need to add about 2.2 KW of panels to my array to cover my batter (note the math is complex so I went to PV WATTs to get the 2.2 KW) Folks with longer days south of me would need less. Assuming 300 watt panels that is about 8 additional PV panels on the roof to cover the car. I do have more PV generation than I use so I run a surplus, I currently use that surplus to heat my house with a minisplit in the shoulder seasons instead of running my wood boiler. I may just need to run the wood boiler a for more weeks but the reality if I work from home and do not drive a lot so it may not be big impact. I have a total of 4.6 KW of PV currently with a possible increase to of 2.3 KW of panels coming on line soon.

I do agree that Tesla and other EV folks may want big amperage chargers to quick charge for trips but they only need them if they want to drive the miles. Its pretty simple, if they want the quick charge and the grid has high demand, they pay a premium or they wait. Factor in big improvements in battery capacity and range will increase so that for most drivers they have enough daily capacity that the majority of their charging will be at night.

So many aspects are in place to shift vehicle use to predominantly electric without radical grid changes. it just takes government focus to guide the transition. The US lost out on 4 years of government guidance with the last administration and given the current congressional gridlock we may loose out on another 4 years. IMO far better to upgrade the US grid to support EV with domestic renewable power and reduce the demand for fossil than being forced to spend military dollars and lives propping up dictatorships around the world to keep pumping oil.
 
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fbelec

Minister of Fire
Nov 23, 2005
3,025
Massachusetts
i'm glad your system works for you. i install car chargers all the time no one down here in mass wants to use the 120 volt chargers because they take to long to charge. almost everybody i install chargers for is using the 50 amp tesla or it's a toss for 50 or 30 amp chargers at 240 volts. when they get home at 6:00 to 7:00 they don't have time to play around and everything goes on laundry, dishwasher, car charger, electric stove, and if winter electric heat which in mass is the most expensive way to heat. everybody did that all at the same time something would have to give. the reason that the led bulbs and insulation around here is dam close to being free is all funded by us thru the utility company. they are doing that because they the company don't have the capacity to keep going in the direction we are going. in the past when it was 100 degrees there would be so many air conditioners running that they had to go to rolling black outs. whether people knew it or not that was what happened.3 to 4 hours of black out won't bother the fridge or freezer and that is why it is only 3 to 4 hours. the last time a power plant was trying to go up people stopped it because they don't want that in their neighborhood but people want power. nuclear is clean but they have to come up with a better way to control it. hydrogen power is not bad but there is no way to make lots of it inexpensively. if our oil price goes up then the oil fired plants make expensive power. in a perfect world we can do anything but it is not perfect. unfortunately.
 
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peakbagger

Minister of Fire
Jul 11, 2008
6,400
Northern NH
Power plants are going up in Mass, just not the type you would imagine. I have installed 14 MWs of generation in the last 5 years with another 7.5 going on line soon and my firm is not the only one. The utilities are paying businesses and institutions to build on site combined heat and power plants that generate all the power the facility needs which frees up capacity for the grid. This eliminates transmission loss as the generation is hooked directly to the incoming switchgear. The institutions get free heating and cooling from the waste heat from the generator. Unless someone tells the neighbors they do not even know the plant was built. Most of the big hospitals and lot of the colleges in the Boston area have done the same thing.

I do not see a lot more conventional nukes being built. The new liquid metal "nuclear battery" style plants that are on track to be deployed in Wyoming are a far more viable option. Mass is betting on off shore wind with a long extension cord to Canadian "Hydro" which eventually leads to a couple of natural gas power plants that Hydro Quebec was paying for but not using.

Mass long ago decoupled utility profits from sales of power. The utilities do not own generation, they just deliver it. They get paid a base rate for transmission but their big profit is conservation. The state PUC sets targets for reducing demand and they get a reward for meeing the target by pushing demand reduction, batteries and conservation.

I agree that unless there is an economic penalty, most folks will go with fast charging and that is going to load up the grid. Put in tiered rates tied to grid congestion and my guess is they will change the way they use power. Interesting how things change, many states were discussing charging a premium for power connections in excess of 100AMPs and I even saw proposals to charge a premium for over 60 amps.