Second Warning

In October of 2010 I wrote a letter to my local paper, the Explorer, entitled “It’s The Energy That Matters” although I can’t remember what it was eventually titled as when published a few months and quite a few revisions later.

I have a copy somewhere and should dig it out. Anyway, the paper has since changed editors, for the worse in my opinion, but hey, why not have a second go.

Why write to a local paper ?!

Newspapers are a dead medium, read in retirement homes and used as paper machĕ by kindergarteners. BUT some people still do read them, people who might not have access to other forms of media, or aren’t curious enough about the world … for whatever reason I want this message (again) to appear in print, locally.

This letter, and I guess the one before it is aimed at the people who I hear on NPR (a news organization rapidly losing my respect for some of the things it calls news) talking about the questions they want to ask Mitt Romney or Rick Santorum, which invariably focus on jobs/economy/gas prices. HELLO, MCFLY ?! anybody in there ? A politician is the last guy that can do anything about the price of gas. Strategic petroleum reserve ? please. (even though I ended my last letter like this: “Coming elections present opportunity for us to question our various candidates about their views on our energy future and how best to cushion the energy descent that an oil shock will bring.”)

Anyway. I know there are people like that in my immediate area who need to be woken up. Oh how compassionate of me to attempt to do so ! Yes. But then there are the everyday folks who are curious, occasionally flip the paper open and have, of late, been wondering WTF is going on. For those people, maybe this letter would be something helpful.

—————————————————————————————————————————————————–

Second Energy Warning

There is a very high probability that 2012 will look very much like 2008. In late 2010 I wrote a letter detailing a couple of reports on oil and energy crises in general and urged people to read them and discuss. One from the Llyods Risk Assesment Division and the other was the energy section from the US Joint Forces Command JOE 2010.

This is a second warning. We have entered a period of time which will be accented with wilder than normal oil shocks. By summer gas will most likely hit $5 again. Take notice, as this is the new normal, it is an embedded warning that something needs to change, and has needed to change for a long time.

Don’t listen to anyone that will just brush off this situation and believe that we’ll be saved by natural gas, offshore drilling, kerrogen, domestic shale, or the keystone. The reason the KXL 2 may have to exist, at very little benefit to the US I might add, is that easy oil is gone. Currently the US imports roughly 50% of its oil, which is down from recent years, we are currently experiencing an oil and natural gas boom, yet gasoline prices persist to peak because oil markets are global. We’re also currently a net gasoline exporter as we have all the cheap natural gas we want for refining, this situation will not persist. Saudi Arabian excess capacity is in decline, their ability to smooth the market is waning by the year.

Shocks are going to become more frequent and more extreme, demand will keep prices in check, but at increasing pain levels. If you have the ability, sell the vehicle that gets 20mpg, because in 5 years it will be worth scrap only; get ahead of the curve. It is a simple logical challenge; deal with repeated pain at the pump more frequently or change your habits.

————————————————————————————————————————————————–

Edited down as submitted –

There is a high probability that 2012 will look much like 2008. Late 2010 I wrote a letter detailing a couple of reports on oil and energy crises in general and urged people to read and discuss. One from the Lloyds Risk Assesment Division and the other was the energy section from the US Joint Forces Command JOE 2010.
This is a second warning. By summer gas will likely hit $5 again. Take notice, this is the new normal, it is an embedded warning.

Don’t listen to anyone that will just brush off this situation and believe that we’ll be saved by natural gas, offshore drilling, kerrogen, domestic shale, or the keystone. The reason the KXL 2 may have to exist, at very little benefit to the US I might add, is easy oil is gone. We import 50% of our oil, down from recent years, we’re experiencing an oil and natural gas boom, yet gasoline prices persist to peak because oil markets are global. The ability of the Saudis to smooth the market declines by the year.
We’re also currently a gasoline net exporter as we have all the cheap natural gas we want for refining, this situation will not persist.

Shocks will become more frequent, extreme, demand will keep prices in check, but at increasing pain levels. If you have the ability, sell the vehicle that gets 20mpg, because in 5 years it may well be worth scrap only; get ahead of the curve.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s