About Opec

Klaus H Hemsath asked:


Market prices for petroleum are moving upwards. This movement can be stopped only when alternate liquid fuels will become available in large quantities. OPEC (Organization of Oil Exporting Countries) controls and sets global prices for petroleum.

US oil companies follow the OPEC price lead gladly and are reaping excessive profits. Available petroleum reserves are being depleted at a rapid pace. Demand is overtaking supplies. Discoveries of new petroleum deposits are plummeting. Excessive prices for transportation fuels will lead to economic hardships and eventual economic collapse. World economies must find alternate liquid fuel supplies or they will self-destruct.

Remaining petroleum reserves are estimated at 1.3 to 2.3 trillion barrels. These reserves can only last 25 to 50 years at consumption rates that will exceed 50 billion barrels per year on an average for the next fifty years. This huge consumption will add more than 100 ppm of carbon dioxide to the Earth’s atmosphere, which is already overloaded.

Transportation fuels are the lifeblood of modern economies. Foods, goods, and commodities must be transported to reach consumers. Short interruptions in transportation lead to economic crises. Long-term interruptions lead unavoidably to economic disasters and collapses. Governments and industries have not been able to develop sensible solutions for secure, future fuel supplies.

Many options for extending or replacing petroleum and its many refinery products have been proposed. Finding new petroleum deposits, making petroleum substitutes from coal or oil shale, producing ethanol from food crops, producing hydrogen using nuclear power, legislating “Cap and Trade” policies, and demanding strict energy conservation measures have been suggested. None of these energy supply options can withstand closer scrutiny and analysis.

If none of these popular proposals is acceptable in the final analysis, is there any solution left that can be developed in time, can be used for several centuries, will not slow global economies, and will in fact accelerate economic growth for all the world’s countries?

Only one single option for saving our world from economic collapse exists. We must learn how to convert solar energy into liquid fuels and we must prevent the use of precious, limited, fertile lands that produce food crops, feed livestock, or grow forests. We must learn how to grow and breed high energy yield plants, plants that have high energy contents and produce large amounts of biomass on a single acre of land.

Additionally, we must find energy conversion processes that convert biomass into petroleum substitutes and we must modify existing refinery techniques to produce liquid motor fuels from biotic petroleum substitutes. None of these process steps is utopian. All of them can be developed and tested on a large scale in less than two decades.

The benefits of such an approach are manifold and exceptional. The world will be enabled to produce affordable, plentiful, and secure liquid fuels for centuries. Competition between food and energy producers for fertile lands is not necessary and must be outlawed. The continued use of the world’s inventory of combustion engines installed in automobiles, trucks, trains, ships, and airplanes is assured. The world’s facilities for oil refining and fuel distribution can be used without major changes. A seamless transition from a fossil fuel dominated economies to solar based economies is entirely possible. Millions of new jobs across the globe will be created. Nobody loses, most people win.

How can we create this new, exciting future, how can we prepare for it, how can we implement it?

The world’s future critically depends on the achievement of several well defined objectives and tasks. None of the necessary tasks seems to be excessively difficult; none of the tasks is in conflict with established science or with established economic conventions. How do we proceed?

Only the USA is capable of leading the world in developing renewable, liquid fuels. The US must lead by example. The US has all the prerequisite facilities, lands, technologies, scientists, and engineers. Above all, the US must find political leaders with intelligence, vision, and independence.

The US must establish a single mission agency, the Energy Independence Agency. This agency must be charged with developing a range of techniques for producing liquid transportation fuels from biomass and converting solar energy into liquid fuels that can be stored and distributed globally.

The introduction of this new energy technology can be accelerated by inviting the rest of the world to cooperate. This proposal will find many opponents. OPEC and oil interests will be the most powerful and most vociferous adversaries. Other challengers will come from the agricultural community, from scientists and from diverse political, financial, and environmentalist interest groups.

However, antagonists must remember that the world is facing an existential threat. If we do not find a way to effectively and conclusively deal with the approaching transportation fuel shortage, we will destroy economies and cultures. We cannot turn back the clock. We must deal with the situation we are facing today. We must resolve threatening global issues within less than three decades. We must assure the continuing growth of economies, we must stop global warming and climate change, and we must prepare the world for a major increase of its population. We must act very soon or the Earth as we know it will cease to exist.

Future generations will thank us for our efforts and for our concern for their wellbeing.

Laurie

Klaus H Hemsath asked:


Worldwide demand for petroleum is increasing. Crude oil prices have topped $135 per barrel. Oil prices have been on a steady climb for a long time. Dwindling OPEC oil reserves and a weak dollar are driving petroleum prices to new heights.

The US government has made no serious efforts to develop effective countermeasures. Instead, energy conservation, ethanol production from corn, and a failing “Cap and Trade” permit system are hyped by politicians.

Exploding grain prices have exposed the ethanol hoax and made poor people across the world scramble for food. Coal and oil sands are used to produce petroleum substitutes and increase greenhouse gas emissions. The “Cap and Trade” concept was tried in Europe. The concept is deeply flawed. It does not provide lasting relief. It merely delays the day of reckoning for a few years.

Electricity and liquid transportation fuels are the lifeblood of our economies. Economic growth is impossible without plentiful, affordable, and secure energy supplies. Economies will collapse when supplies of petroleum begin to shrink, when global warming keeps causing damages, and when energy prices continue skyrocketing. Will our grandkids witness such disasters?

We are facing a problem that is too large to be solved by industrial entities. The financial risks of introducing new technologies are too large. Government agencies and industry cooperatives must find technical solutions to our problems, must install a few of any new energy producing installations, and must make the advanced technologies economically competitive.

Are there any solutions that can be developed before petroleum is depleted and before global warming exceeds the 3 to 4 degree Celsius global warming threshold?

The world community must solve these two threatening disasters very quickly. Petroleum reserves will last only a few more decades considering the accelerating, worldwide demand. Greenhouse gases from coal and petroleum combustion will continue to accumulate in our air at ever faster rates and will accelerate global warming and ice melting. Any of these disasters may strike within less than five decades.

Increased use of nuclear power can generate large amounts of electricity and can replace the use of coal. Increased use of solar power, hydropower, wind power, marine power, and geothermal heat can provide additional electricity.

Surprisingly, only one single concept seems to have the potential to produce sufficient amounts of liquid transportation fuels. This concept is the conversion of biomass into liquid petroleum substitutes.

The concept of biomass conversion has just suffered a major public relations debacle. The ill conceived process of converting corn by fermentation into ethanol has led to a temporary tripling of US corn prices. This huge increase caused the destabilization of worldwide food prices. This effect was entirely predictable. Nevertheless, this concept was considered worthy to receive large governmental subsidies.

Biomass conversion into fuel is our one and only option. We must learn how to convert sunlight, water, carbon dioxide, and fertilizer into biomass. Food crops are not suited for conversion. Food crops have been selected, domesticated, and bred to provide tasty and nutritious foods. Energy crops must be selected based on entirely different properties. Energy crops must have very high energy content, must provide very high crop yields, and must grow very fast. This means that we must find and further breed plants with very high energy yields; i.e. plants with the highest values of energy per acre per year.

When designing biomass plantations, we must address several specifications. We need plenty of sunshine and we must protect against the misappropriation and abuse of fertile lands and of forests. By locating biomass plantations on arid lands and by combining biomass growing and biomass conversion into a single facility, we can avoid abuse of agricultural lands.

Biomass production must be designed to be highly automated and mechanized to lower costs. Additionally, biomass is best converted into petroleum substitutes within hours. Such quick conversion requires on-site processing. Harvested biomass cannot be stored for long times. Liquefied petroleum substitutes can be stored in tanks and can be transported by pipeline.

Obviously, such radical plantation concept, which ideally uses hydroponic techniques and is not dependent on soil quality, will need development. New biomass types must be identified. The performance of high energy yield plants must be optimized. The engineering of hydroponic plantations located on arid lands or in deserts must be completed, pilot plants must be built and tested, and fast conversion processes for converting carbohydrates into hydrocarbons must be found and developed to maturity.

One question remains; does our Earth have large enough areas of arid land which are ideally located closely to coasts and seawater?

In 2004 the world consumed roughly 30 billion barrels of petroleum. This figure translates into an energy consumption of 173 exajoules per year. We know the energy yields of a few food plants. We can extrapolate those energy yields and arrive at a probable energy yield of newly bred plants of 10,000 gigajoules per hectare per year. When we divide energy consumption by energy yield we arrive at a figure of 17.3 million hectare or 42.6 million acres. This area is equal in size to the state of Florida. This small area can support biomass growth to supply the entire world with transportation fuels! Very large areas are readily available to support the growth of biomass. The Earth has many arid areas and huge deserts.

US government must lead the world in this endeavor and must establish an agency with a single mission: Develop the technologies to produce plentiful, affordable, and secure liquid transportation fuels for the next few centuries.

Rafael

James William Smith asked:


The vote was 324-84 as the United States House of Representatives recently approved legislation allowing the Justice Department to sue members of OPEC . The House bill blames OPEC for limiting oil supplies and working together to set crude prices. In effect, it says that gas and oil prices in America are too high and that OPEC should therefore produce more product. Of course, the vote is a study in congressional hypocrisy as many of the same members, who for decades have opposed drilling for oil and gas in various parts of the United States, voted in favor of holding OPEC accountable for not producing enough. The sad reality for the Congress of the United States is that with the price of a barrel of oil now in excess of $125 and prices at the gas pump near or above $4.00 per gallon, the American public can now clearly see the dubious consequences of not having developed a coherent long term domestic energy strategy.There is no short term solution to this worldwide energy shortage, either. The energy requirements of rapidly developing nations have combined with a lack of alternative energy planning to initiate the perfect energy storm for the consumer. There is just not enough supply to meet increasing long term energy demand. However, this economic reality eludes the grasp of the Washington beltway politicians. So, Congress wastes its time voting to sue OPEC for not producing more oil. An action, that if ever implemented, would certainly drive the price of oil and gas even higher.The long term solution to the energy problem is independence from the very oil and gas sources that Congress is trying to sue OPEC to provide more of. In fact, the best examples of a future path to energy independence can be seen in the initiatives that the U.S. military has been using to address its own energy consumption. Historically, the military has been a huge national energy hog. It consumes 340,000 barrels of oil a day, or 1.5% of all of the oil used in the country. The Defense Department’s overall energy bill was $13.6 billion in 2006 (latest figure available). In fact, the Air Force’s bill for jet fuel alone has tripled to $6 billion in just the past four years. However, the Air Force is not acting like the U.S. Congress when confronted with the spiraling cost of energy. It is actually trying to do something tangible about the problem. The Air Force has been experimenting with alternative fuels to reduce its foreign dependence on energy while reducing cost. Their plan is to create a supersonic synthetic-fuel for the B-1 bomber. The Air Force is also experimenting to make engine parts out of lighter metals, such as titanium, in order boost fuel efficiency.Meanwhile an Air Force base called Nellis near Las Vegas has just opened one of the largest solar arrays in the U.S., a 140-acre field of 72,000 motorized panels that powers the base and sells energy to nearby communities. The Pentagon is soliciting bids for three similar arrays on other bases. Another Air Force program in Iraq is turning the trash from Air Force bases into bio fuel. The truth is that, for the last several years, the Pentagon has sponsored various initiatives to find solutions to the increasing cost of energy. These initiatives can be seen in all branches of military services. In the Army, engineers are instructing contractors to build armored vehicles with hybrid engines. In addition, research is well under way to explore the possibility of building small nuclear-power plants on unused portions of remote army bases.The United States military has also sponsored a futuristic plan to collect solar energy on satellites and beam it back to Earth. This space-based solar power would use solar panel arrays to gather sunlight in orbit. It would then beam power down to Earth in the form of microwaves or a laser. Energy would be collected in antennas on the ground and then converted to electricity. Unlike solar panels based on the ground, solar power satellites placed in orbit above the Earth could operate at night and during cloudy conditions.In fact, solar-power-generating satellites could also solve supply problems in distant places such as Iraq, where fuel is currently trucked along in dangerous convoys and the cost of electricity for some bases can exceed $1 per kilowatt-hour, about 10 times what it costs in the US. This technology has the potential to provide a clean, abundant energy source and reduce global competition for oil.The Pentagon’s battle plan to combat the ever increasing price of energy is to go green. Indeed, it is the use of American creativity and ingenuity that will solve our energy crisis in the future. The Pentagon certainly gets it. The absurd Congressional law suit against OPEC shows just how much the Washington beltway politicians do not.

Erik

Gerald Greene asked:


The commodities futures market has been described as continuous auction markets. It is a clearinghouse for information about supply and demand. The futures market reflects the cash market.

The difference between futures prices and cash prices at any moment is called the basis. Compared to the stock market the futures markets are exceptionally prone to false breakouts and trends have wilder swings, tempting traders to leave early or enter late, possibly with a loss. Just have a look at commodity futures charts, and compare them with stock market charts. The difference in trading pattern will be apparent.

The futures markets enable buyers and sellers to hedge against, or cushion the impact of, pricing changes. Buyers and sellers set up trades to minimize potential losses from rising and falling prices on spot markets through these hedges in the futures market. The futures market is used to help determine the price for future deliveries. It is used to purchase a contract today to guarantee a future shipment of commodities like coffee and copper.

The commodities futures market attracts speculators due to the nature of rapid changes in price levels as well as the large amount of financial leverage offered on trades. A commodity speculator may be required to deposit only $5,000 to control $100,000 or more of a commodity. This leverage increases the profit potential on trades but as many traders soon find out also increases the risk of loss.

The futures market performs its function of price discovery more rapidly than the stock market. The futures market in the United States has deepened considerably since 1990s. One recent reason for keen interest in the futures markets has been the movement of crude oil contracts. Tremendous fortunes have been made and lost as crude oil moved from $10 a barrel to nearly $150 a barrel over just a few years.

Longer-dated futures prices are also responding more to daily oil market news, suggesting that while market participants are more actively forming views about prospects for supply and demand, their assessment of the likely impact on future prices has become more uncertain. The futures market can take in billions of dollars within minutes, causing the danger of a stock market crash from instability. Many common stock holders may all want to sell simultaneously should a spike in the price of oil continue for long. No doubt money has moved from the stock market to the commodities futures market during the run up in oil and other commodity prices.

Prices are usually expressed in monetary terms. In a free market, prices are set as a result of the interaction of supply and demand in a market. When demand for a product increases and supply remains constant, the price tends to rise. When demand for a product decreases and supply remains constant, the price tends to decline. Prices are an indication of the scarcity of goods and resources.

In the case of oil contracts we have little idea what the real price of oil should be because of massive government intervention and massive speculation, some of which helps keep the price artificially low and some of which drives the price up. Recently huge inflows of funds from hedge funds and the like have driven oil prices sharply higher as fears mount that indeed peak oil is not only real but is already happening. Then you have heavy demand pressures coming from China and India as their economies continue to grow at 8% to 11% a year, year after year.

Contract trading is done for a fixed fee (commission) per contract ranging somewhere between $25 and $100 per contract or even less with Internet trading(in and out). Contracts are created by market demand for the basic commodity. Contracts are standardized according to the quantity, specification, place and date of delivery. Since not all basic commodities can be standardized, there are futures contracts only for the main ones.

Margins are determined on the basis of market risk and contract value. Margins are also referred to as performance bonds. Margin accounts and a process called marking-to-market all but assure the clearinghouse’s solvency as the commodity trader gets a daily report on the standing of trading accounts and must immediately fund margin calls or face liquidation of his contracts.

Oil is not really just a dollar story but is a supply/demand story. Oil prices were boosted Friday, June 6th, to record price levels near $140 a barrel by the dollar, which declined sharply against the Euro and Yen. The European Central Bank said it was unlikely to consider interest rate cuts to cool the strong Euro against the slumping dollar. Oil at $135 to $140 a barrel is already doing that a bit , but in Europe some 53% of the cost at the pump is government taxation. It doesn’t carry much weight at OPEC when more than half the oppressive cost of fuel amounts to taxation.

Besides OPEC members realize more than anyone that oil is a depleting resource and that one day all that can be pumped out of the ground at reasonable cost will be gone forever. They are going to get as much cash as they can for as long as they can from their oil resources. If you have to have the oil you are going to have to pay up.

Oil is not the only commodity that has been roaring ahead this year. Precious metals are in a major bull market as are corn, wheat, rice, and soybeans. In fact, while the fall in the dollar is part of the commodity futures bull markets story you can not get away from the fact that rapidly developing economies in a number of nations and changes in weather patterns caused by climate change are important factors in driving futures prices.

The commodities futures markets are probably going to roar ahead for quite some time. It is a most interesting market environment but also a dangerous one as nations compete for increasingly scarce natural resources and food supplies. Wars have been fought over far less important matters than having enough food to eat or enough energy to keep your economy functioning.

Maria

jhnmttngly09 asked:


In some foreign countries that have oil, the gas only costs 25 cents a gallon. What can we do to fix this problem and make the gas prices lower again, like the way they should be.

Donald

reghunath asked:


Each and everybody’s participation is solicited in this regard to find an alternate to propel the machines on the move.Whether is ubsurd or foolish that may be felt to otersesn’t matter. You are on the move to find a solution.Be part of a Great cause. sometime it would turn correct and be proud of it.

Dawn

myself asked:


This would allow them to feel more safe in case of an invasion of their oil fields in the future? If anyone comes to invade, what the OPEC members would do would be to just destroy their oil fields and refineries.

No one wants a desert that has no natural resources so I assume the invading countries would just leave them be.

Wouldn’t this be a good form of self defense for the oil companies?

The reason I am asking this is because I see a possibility of large scale wars in the future for energy if we don’t start investing and mass producing alternative fuels.

Gail

PRH1 asked:


It seems like all the oil in the world comes from the Middle East and other OPEC countries (they aren’t all in the Middle East).

How about all the other oil-producing countries in the world, such as the USA and Russia? Why can’t they increase their oil production to make it a bit cheaper?

Just wondering.

Micheal

Earth: The Connected Home asked:


would we redirect enough of the Sun’s energy to counteract global warming?

I don’t mean “carpetted” literally of course.

Louis

SKYDOG asked:


Congress claims that OPEC has been price gauging their customers for years now.
Why dosen’t Bush want justice for the American people?
Wow, what a bunch o’ sheep !
-”that’s stupid. . .”
-”We don’t wanna wake our oil masters mad. . . ”
-” you’re a democrat. . . ”

Nice, well thought out answers.

Maybe some of you milk toast conservatives should rent a spine.

Erica