The Etp Model Has Been Empirically Confirmed

[Beer w/Straw]

Aren't the Saudis happy with low oil prices so it can can kill their competitors and the take more of the market?

Holding a war chest of assets, Saudi Arabia calculated it could withstand lower oil prices better than its competitors, pushing high-cost producers out of the market and grabbing market share.

http://blogs.platts.com/2015/07/13/saudi-arabia-foreign-reserves-oil-prices-petrodollars/

Meaning oil prices are deliberately low for long term economic reasons?

I remember Obama also saying this, quite interesting...

https://www.whitehouse.gov/blog/201...il-strategy-increase-economic-growth-and-redu

 

[Beer w/Straw]

The Financial Times just

I can't even get to the article...

But, without even mentioning thermodynamics, what I've just previously posted kills the Etp model and your predictions.

I was kinda' getting annoyed with all those prophecies of doom. And where is your work published?

 

[Kondratieff]

Not at all. Prices will "need" to rise when we once more "need" the oil from these projects that are not viable at current prices. And that, obviously, is what will happen. Oil will get shorter and the price will rise….and then one by one these projects will be progressed once more. It is sheer nonsense to talk about "needing" 50-60 projects every year "to keep society functioning". You do not need any, if you have masses of cheap oil from the Middle East, as we do now, thanks largely to Saudi policy. You only need it once these supplies start to dry up,

Well, I certainly agree when you refer to the oil coming from Saudi Arabia as "cheap oil". The Kingdom has been able to increase its oil production by 700,000 bpd since February (from 9.7 mbpd to 10.4 mbpd, now its production is holding steady). However I don't agree when you say that is nonsense to talk about needing 50-60 projects every year, especially when we consider the fact that world Oil production has been increased only because of the US shale "revolution". Who is going to replace the oil production drop coming from Mexico? And the production drop coming from the North Sea http://www.telegraph.co.uk/finance/...investment-collapse-from-oil-price-slump.html ? Are you implying that only and solely the Middle East will be able to power the world, when it only makes the 33% of the global oil supply - http://ncusar.org/blog/2013/03/basic-facts-about-oil-and-gas-in-the-arab-world/ ? We were supposed to use a lot of unconventional oil resources to power our next cycle of economic growth. The soaring demand from China+India+emerging economies plus a strong Europe/U.S. will make the world to require 125 mbd per day in 2025 http://www.mnforsustain.org/oil_peaking_of_world_oil_production_appendix.htm, where do you plan to get this oil when arab countries produce only 30 mbd right now?- Why if not the Big Oil Companies were planning to drill in the Artic or start expanding deep-water oil projects?

Let's imagine that I'm wrong and you're right - In that case, the world is in for a massive oil price spike in the next 2-3 years - because demand will have grown stimulated by low oil prices (according to the conventional thinking) but oil projects will not have come online - and it would be required at least some months/1-2 years to start them.

There is certainly a challenge for oil companies to forecast the oil price over the estimated lifetime of production for each project. They cannot rely on the price for the next 2-3 years, but need a longer term view, due to the long term nature of the projects. But managing that is what oil companies do for a living.

Agreed.

Your concept of a debt cycle involving petrodollars from KSA etc is ingenious, but has nothing to do with the 2nd law of thermodynamics.

Well, it's certainly not my concept. It's Steve Ludlum's concept. He says that the QEs- "oil boosting effects" are gone, and what is worse, US consumers are tapped out as Saudi Arabia cannot buy US treasuries any longer- Because of the same drop in oil prices. In my opinion, he tries to explain the economic effects of a physical reality (There is more POOR quality oil, which requires more energy, capital, labor, and other inputs to be developed and extracted ; and there is less HIGH quality oil, which requires less energy, capital, etc), and how its effects reverberate through the economy. I guess he has done an excellent job, since he was able to forecast the oil price plunge (and the exact timing of it) more than 2 years before it actually happened.

And where is your evidence for the statement that customers are rapidly going broke? Who? Where? And kindly do not quote notorious Eurozone casualities this time.

Well, I chose the Eurozone example because it serves a lot when you have to counter-act the argument that less demand for Oil consumption means that the world is becoming more efficient. In that case, it signals that oil demand is lower because customers are going broke and misery is spreading. My point is that this is starting to happening in a global scale since some time ago. This is a good example of what I am saying: http://www.telegraph.co.uk/finance/...oms-as-world-sinks-beneath-a-sea-of-debt.html . Customers are insolvent since they cannot longer service their debt. Only low interest rates across the globe and massive money-printing (Central Banks are basically giving us "more time" in order to return to a sustainable growth - a growth where our debts are repaid - , but I don't see it happening) have been able to postpone the outcome. However, the debt-system is entering in a contradiction phase: "damned if you do, damned if you don't", as more loans to the drillers will cause now more customers to go bankrupt (thus prices will plunge again)...

Best Regards,

 

[brucep]

Not at all. Prices will "need" to rise when we once more "need" the oil from these projects that are not viable at current prices. And that, obviously, is what will happen. Oil will get shorter and the price will rise….and then one by one these projects will be progressed once more. It is sheer nonsense to talk about "needing" 50-60 projects every year "to keep society functioning". You do not need any, if you have masses of cheap oil from the Middle East, as we do now, thanks largely to Saudi policy. You only need it once these supplies start to dry up, or a long term change in pumping policy is foreseen. There is certainly a challenge for oil companies to forecast the oil price over the estimated lifetime of production for each project. They cannot rely on the price for the next 2-3 years, but need a longer term view, due to the long term nature of the projects. But managing that is what oil companies do for a living.


Your concept of a debt cycle involving petrodollars from KSA etc is ingenious, but has nothing to do with the 2nd law of thermodynamics.

And where is your evidence for the statement that customers are rapidly going broke? Who? Where? And kindly do not quote notorious Eurozone casualities this time.

Very informative. The idea that the oil companies don't understand what's going on is ridiculous. This thread is full of 'doomsday knuckleheads' who don't have a clue with respect to reality. The going broke thing is probably a reference to the extreme income inequity perpetuated by the world oligarchs. Thanks for making sense.

 

[Futilitist]

This thread is full of 'doomsday knuckleheads' who don't have a clue with respect to reality.

Really? I think the thread is full of 'right wing knuckleheads' who don't have a clue. These business as usual, 'right wing knuckleheads' seem to have an agenda other than science, although they are actually quite inept when it comes to accomplishing it.

The reason why the oil price fell was increased supply in the US, as explained here : http://www.economist.com/blogs/economist-explains/2015/03/economist-explains-14 . This triggered the Saudi action to defend market share, and both of these factors came together at a time when people were beginning to realise the Chinese boom was reaching a natural plateau (as its citizens grew wealthier and more demanding, and various bits of economic mismanagement started to come unstuck, e,g their property bubble). No need for pseudoscientific "thermodynamic" explanations.

Hey exchemist, the world economy is a thermodynamic system. To claim otherwise is unscientific. When you say, "the Chinese boom was reaching a natural plateau" you are basically acknowledging that the economy is a thermodynamic system with natural limits to growth.

You just list a series of excuses for growth slowing in China. These are really just descriptions of the symptoms of that slowing. So, you are actually just describing the situation and saying nothing about the underlying causes.

World GDP growth has been very anemic since the Great Recession. How do you explain this?

And oil prices have been under 70 dollars a barrel for about 10 months. That should really be stimulating the economy, shouldn't it? So where is the expected economic boom? Why won't the oil price go up?

The Etp model offers a very good explanation of all of this. Exchemist only offers excuses.



---Futilitist

 

[Beer w/Straw]

If you can show how thermodynamics effects prostitution, I would really really be impressed.

 

[Beer w/Straw]

And just what is this Steve Ludlum

Na nana na na na nana na na-aaaa
Na nana na na na nana na na-aaaa

blog http://www.economic-undertow.com/

 

[Futilitist]

There is certainly a challenge for oil companies to forecast the oil price over the estimated lifetime of production for each project. They cannot rely on the price for the next 2-3 years, but need a longer term view, due to the long term nature of the projects.

And the Etp model provides just what is needed to get a longer term view.

"The ETP model's predicted rapid decline event is in opposition to the contemporary assumption that production will phase out slowly. The slow decline scenario is known as "sliding down Hubbert's curve". Implied in this belief is the assumption that all barrels of petroleum were made equal in quality, and will remain so in time. Of course this conflicts with the Second Law, and thus can not be an accurate representation of the situation. All barrels were not made with an API of 30-45°, nor is the energy needed to extract, process and distribution them the same over time. It has to increase.

Petroleum depletion is further advanced, and its production will decline faster than generally assumed. Conventional reservoir appraisal methods are founded on First Law premises, but neglect Second Law effects. Although extremely applicative to individual field analysis, when applied to the status of the world's petroleum reserve they produce inconsistent results. In consequence, the last 25% of the world's energy supplying reserve will be orders of magnitude more costly to produce than was the first 25%. The advancing depletion of the world's petroleum reserve could bring about changes of a magnitude that have not been witnessed for millennium! To navigate this conflicting, and difficult era an understanding of the events taking place will be essential. It is our hope that this report will contribute to that endeavor."
~The Hill's Group™

It is undeniable that the second law of thermodynamics mandates that oil production costs must rise over time. It is also undeniable that there must be limits to economic growth.

Why don't you want people to be aware of these facts, exchemist?



---Futilitist

 

[Beer w/Straw]

Are there statistics for oil quality due to gravitational time dilation for deposits nearer the surface of the Earth then those deeper underground?

I need a chart ASAP!

 

[Kondratieff]

And just what is this Steve Ludlum

blog http://www.economic-undertow.com/

Well, to be honest, I think I understand now how Futilitist feels about the debate with some people here.

Nice "straw-man" by the way.

If I were to talk about Steve Ludlum, I would start saying that he is the author of the following picture that was chosen by the NYT: http://www.nytimes.com/packages/html/nyregion/9-11imagemap.html (bottom-right of the main picture)-> He even won a Pulitzer price for it!: http://www.pulitzer.org/archives/5308

Of course, this is not in any way related to his economics analysis, but is more respectful to his persona than to put an absurd extract of his blog - out of context - just for the sake of discrediting him.

I don't think I have to debate anything with anyone which uses these cheap tricks. However, I will be looking forward to having a meaningful debate with ex-chemist or any other who is able to discuss in a respectful and honest way.

Best Regards,

 

[Futilitist]

Well, to be honest, I think I understand now how Futilitist feels about the debate with some people here. However, I will be looking forward to having a meaningful debate with ex-chemist or any other who is able to discuss in a respectful and honest way.

I am glad you see what I mean about the general level of the debate practiced on this so called science forum. However, I think you may be over estimating exchemist:

Well's as close to head up arse as I've seen - if we exclude from consideration the attitudes of certain posters on this forum.

This is what people who can't make serious arguments do. They childishly attempt to make fun of their opponent.

ad ho·mi·nem
ˌad ˈhämənəm/
adverb & adjective
adverb: ad hominem; adjective: ad hominem

1. (of an argument or reaction) directed against a person rather than the position they are maintaining.

Of course, this desperate attempt at derision really amounts to a circular argument as far as the validity of the Etp model is concerned.

Circular reasoning (Latin: circulus in probando, "circle in proving"; also known as circular logic) is a logical fallacy in which the reasoner begins with what they are trying to end with.

Exchemist clearly has the cart before the horse! In order to make fun of the Etp model, he must first prove it is invalid. He must say why it is so worthy of derision. I submit that he has not accomplished that. Not even close.



---Futilitist

 

[Beer w/Straw]

Uh... What "Straw Man" and what "Circular reasoning"?

I keep hearing 'thermodynamics'. Maybe you two should study thermodynamics before I'm accused of those things. Have you?

And I kinda' doubt whomever believes in the ridiculous things thermodynamics has been ascribed to in this thread, that exchemist will foresee any reasonable conversation to be had with that person. But, I'm sure he can speak for himself.

 

[brucep]

Really? I think the thread is full of 'right wing knuckleheads' who don't have a clue. These business as usual, 'right wing knuckleheads' seem to have an agenda other than science, although they are actually quite inept when it comes to accomplishing it.


Hey exchemist, the world economy is a thermodynamic system. To claim otherwise is unscientific. When you say, "the Chinese boom was reaching a natural plateau" you are basically acknowledging that the economy is a thermodynamic system with natural limits to growth.

You just list a series of excuses for growth slowing in China. These are really just descriptions of the symptoms of that slowing. So, you are actually just describing the situation and saying nothing about the underlying causes.

World GDP growth has been very anemic since the Great Recession. How do you explain this?

And oil prices have been under 70 dollars a barrel for about 10 months. That should really be stimulating the economy, shouldn't it? So where is the expected economic boom? Why won't the oil price go up?

The Etp model offers a very good explanation of all of this. Exchemist only offers excuses.



---Futilitist

You're the knucklehead. Your spewing doomsday nonsense. The prediction you made with your bonehead theory predicts the end of civilization in 2021. Why the fuck are you trying to warn us of this when you absolutely say there's nothing we can do about it? Apparently you just need to run your mouth about shit you don't understand like every other intellectually dishonest crank. The dumbshit model offers a good explanation for a doomsday crank such as you. If you knew anything about how the science of physics is conducted you wouldn't need to worry about getting off the planet in the near future. There's a reason that only cranks are interested in this bullshit correlation. The folks you called right wingers were nice enough to try and help you through this nonsense filling the space between your ears.

 

[Futilitist]

And I kinda' doubt whomever believes in the ridiculous things thermodynamics has been ascribed to in this thread, that exchemist will foresee any reasonable conversation to be had with that person. But, I'm sure he can speak for himself.

You should just let him speak for himself, then.

You're the knucklehead. Your spewing doomsday nonsense. The prediction you made with your bonehead theory predicts the end of civilization in 2021. Why the fuck are you trying to warn us of this when you absolutely say there's nothing we can do about it? Apparently you just need to run your mouth about shit you don't understand like every other intellectually dishonest crank. The dumbshit model offers a good explanation for a doomsday crank such as you. If you knew anything about how the science of physics is conducted you wouldn't need to worry about getting off the planet in the near future. There's a reason that only cranks are interested in this bullshit correlation. The folks you called right wingers were nice enough to try and help you through this nonsense filling the space between your ears.

Wow. You seem really upset.



---Futilitist

 

[Write4U]

Futilitist, in all seriousness,

As you know I have refrained from the scientific debate and only made a simple argument about my knowledge of "market economics". When a limited supply of a commodity becomes depleted , the price for that commodity goes up, until it is no longer profitable to engage in trade of that commodity. Today's low prices are artificially maintained in two ways, an expensive scramble for the last remaining oil, while keeping prices low through the corporate welfare system. IOW. "economic strength through exhaustion".

I have no fundamental problem with mathematical relationships of everything, from nano level up to expansion of the universe. They are ALL mathematically connected and thus theoretically should allow for mathematical analysis and I am sure, if you dig down far enough, all numbers (fundamental equations) are related in some way.

But as an ex-bookkeeper I see you draw a financial ledger which offers no solutions, only an ever increasing "imbalance" on both sides of the ledger. From the Beer w/Straws link, it seems that the ledger now has a negative balance of a trillion dollars.
This amount will mature at some time in the future and then what?

In a previous post I asked the question, for sake of argument, let's say you are correct, how are we going to use your proposition to remedie the situation, or if there is a solution at all ?

 

[Futilitist]

In a previous post I asked the question, for sake of argument, let's say you are correct, how are we going to use your proposition to remedie the situation, or if there is a solution at all ?

I think we covered this before.

Problems have "solutions". But we are not facing a problem. We are facing a dilemma. Dilemmas don't have solutions.

I want to know the truth no matter how bad it may be. You don't seem to want to know the truth if it conflicts with your fond hopes.

If, as a society, we realistically come to terms with what we are facing in advance, surely we will react better than if we just blindly hope for the best. Hope for the best, but plan realistically for the worst. To plan realistically, you have to have the best information available. Doesn't that make sense?



---Futilitist

 

[Write4U]

I think we covered this before.

Actually we have not covered this before. I have seen no possible solution to the problem by anyone.

Problems have "solutions". But we are not facing a problem. We are facing a dilemma. Dilemmas don't have solutions.
I want to know the truth no matter how bad it may be. You don't seem to want to know the truth if it conflicts with your fond hopes.

I believe I have confirmed your bleak outlook, albeit in a slightly more conservative way. I can clearly see the problem, the dilemma rests in the available options to address the problem.

If, as a society, we realistically come to terms with what we are facing in advance, surely we will react better than if we just blindly hope for the best. Hope for the best, but plan realistically for the worst. To plan realistically, you have to have the best information available. Doesn't that make sense? ---Futilitist

Of course it does and if you are right we are in dire straits. Have you any suggestions how to address the problem?

 

[Beer w/Straw]

I want to know the truth no matter how bad it may be. You don't seem to want to know the truth if it conflicts with your fond hopes.

And the truth is...

It is undeniable that the second law of thermodynamics mandates that oil production costs must rise over time.

the above statement is absolutely wrong.

 

[Futilitist]

Actually we have not covered this before. I have seen no possible solution to the problem by anyone.

That is a bit misleading. Actually we did cover this before, as in you asked me basically the same question and I gave you basically the same answer. The fact that you haven't seen any possible solutions presented here should tell you something. Perhaps there are no solutions as I said before.

I believe I have confirmed your bleak outlook, albeit in a slightly more conservative way. I can clearly see the problem, the dilemma rests in the available options to address the problem.

My bleak outlook has certainly not been a secret. My bleak outlook is founded on the evidence. The dilemma rests in the lack of available options and the extremely short timeline.

Of course it does and if you are right we are in dire straits. Have you any suggestions how to address the problem?

For the 3rd time, the answer is no.

It is undeniable that the second law of thermodynamics mandates that oil production costs must rise over time.

the above statement is absolutely wrong.

I meant it is undeniable by rational people.



---Futilitist

 

[brucep]

I am glad you see what I mean about the general level of the debate practiced on this so called science forum. However, I think you may be over estimating exchemist:

This is what people who can't make serious arguments do. They childishly attempt to make fun of their opponent.

ad ho·mi·nem
ˌad ˈhämənəm/
adverb & adjective
adverb: ad hominem; adjective: ad hominem

1. (of an argument or reaction) directed against a person rather than the position they are maintaining.

Of course, this desperate attempt at derision really amounts to a circular argument as far as the validity of the Etp model is concerned.

Circular reasoning (Latin: circulus in probando, "circle in proving"; also known as circular logic) is a logical fallacy in which the reasoner begins with what they are trying to end with.

Exchemist clearly has the cart before the horse! In order to make fun of the Etp model, he must first prove it is invalid. He must say why it is so worthy of derision. I submit that he has not accomplished that. Not even close.



---Futilitist

It's worthy of derision because it's bullshit nonsense derived from bullshit postulates. You're a scientific illiterate doomsday alarmist. Folks aren't ignoring this doomsday model for lack of reason. You might have noticed that if you were paying attention.