OIL, OIL Industry - Bleak future ahead

[GoFlyKiteNow]

OIL and the oil industry is staring at its dead end.

Nations that produce and export OIL are facing the prospect of curtains down. WHY.?

Not just due to global warning and environment concers. Well, it plays a part.

But the immediate concern - due to conservation awareness.

1. Reduce consumption, enhance efficiency of existing industries.

2. The emergence of alternate renewable energy sources - like wind, solar, geo thermal etc.

For example: Every DAY, new wind energy capacity equal to 70 Mega Watt is being installed somewhere in the world.
For example: China installs and commissions 1 wind turbine unit every hour.!.... Across Europe and USA, the story is the same. Massive investments into Wind and Solar energy projects are online and will come on stream from now on.

This cuts down that much equivalent of OIL consumption.

Take the recent CASH for CLUNKERS initiative of the Obama administration. Owners of old and large gas guzzling cars can junk them and buy fuel efficient cars. And they get 4500 USD rebate from the US govt for doing it.

The program was so successful that the 3 billion rebate budgeted for it ran out in just 10 days. and the result.? - 700,000 new fuel efficient cars throwing out gas guzzlers off the road.

Benefits.?..If one new fuel efficient car can save an estimated 10 liters a day, then that amounts to 7 million liters saved every day. !!..which is about 3 Billion liters less oil consumption every day in USA alone, just from this program. !!

Now the Fed is coming out with the second such offer..!!
So do many European nations like Germany, UK and France.

Then there are the new initiatives like energy efficient smart buildings, which is now a fast growing industry. It can reduce fuel consumption by 20 %. A big chunk off the oil market.

The OIL industry is nervous. From oil producing nations to rig building and tankers industry - the message is out. After decades of good times, its slow decline and demise is coming. And it can only watch helplessly. Due to the internet, its once powerful lobby has also lost its power to influence public opinion in its favor and or smother funding for alternate energy projects.

 

[longbow]

I think the author did not factor in pop growth and increases in standard of living. Just the fact that Chinese are moving into cars will easily use up available oil. Then factor in India where there is no population control. They too are slowly moving from motorcycles into cars.

A large part of US consumption of oil is due to cars to trucks. Their power generation runs on gas or coal. In 20 years, China will have more cars and trucks than the US and India will probably have 1/2 the number of cars that the Chinese have. I think future of oil is going to be great.

The people that knows the most about this would be the energy companies. After all it is their future at stake.

Shell, an oil major has just about abandoned alternative energy. I think all the money from wind power will come from subsidies.

 

[lewlian88]

probably take another decade to shift mindset to alternative energy LOLz

 

[GoFlyKiteNow]

I think the author did not factor in pop growth and increases in standard of living. Just the fact that Chinese are moving into cars will easily use up available oil. Then factor in India where there is no population control. They too are slowly moving from motorcycles into cars.

A large part of US consumption of oil is due to cars to trucks. Their power generation runs on gas or coal. In 20 years, China will have more cars and trucks than the US and India will probably have 1/2 the number of cars that the Chinese have. I think future of oil is going to be great.

The people that knows the most about this would be the energy companies. After all it is their future at stake.

Shell, an oil major has just about abandoned alternative energy. I think all the money from wind power will come from subsidies.

right now, supply is more tan demand..and with the new carbon trading initiatives coming into play..countries like India and china will be forced to cut green house gases to keep their exports competitive..
so there is not much china and india can do to promote oil industry .

 

[High Command]

Bleak future? Hardly. So long as there are no alteratives it's future is secured until it runs out.

 

[annexa]

Benefits.?..If one new fuel efficient car can save an estimated 10 liters a day, then that amounts to 7 million liters saved every day. !!..which is about 3 Billion liters less oil consumption every day in USA alone, just from this program. !!

And they have been saying this for 50 years. What's another 50?

 

[Cestbon]

Ok here the final conclusion in 10 years time . 1st world country energy/fuel demand will drop by 30% due to more energy efficient machine and population drop. But the 3rd world country will increase usage of energy twice the current rate.

 

[longbow]

Big picture is countries only cares about self interest. Look at US policy on Iraq, Saudi Arabia. Look at the recent wholesale bailout of GM, Chrysler, Citibank, BofA. Not much free market here right? Remember IMF lecturing Indonesia about free market and letting Indo banks die. It is all self interest. Bush ripped up Kyoto agreements.

In 10 years time, China will be an economic giant which country do you think can apply much pressure on China? As it is the US has already been kowtowing to China because of its need for Chinese to finance its growing deficit. Clinton Geithner all made trips to Beijing and made no mention human rights (US self interest is to finance deficits).

But as the Chinese move up the consumer chain, use of oil is not just from more cars but more consumption of consumer goods - 2 tvs in each house, a computer in each house, use and throw plastic goods. Exxon just invested $4.5B in an ethylene plant in Jurong (MM was talking about it) what do you think ethylene is used for? Making plastic products!!!! How about transportation of all this consumer goods.

Of course better fuel efficiency will help reduce oil consumption but it will not be able to dent total oil consumption

 

[GoFlyKiteNow]

You forget two things.

One : China by itself could not grow on its own. China needs Western markets. If not how could it have got the big growth rates it enjoyed till last year.?. So that is dependence..and from dependence comes vulnerability to pressure.

Two: Have you heard about Carbon trading mechanism , that is being put in place by Western nations.?..That is another pressure point.

 

[GoFlyKiteNow]

Ok here the final conclusion in 10 years time . 1st world country energy/fuel demand will drop by 30% due to more energy efficient machine and population drop. But the 3rd world country will increase usage of energy twice the current rate.

Even if your prediction comes true, ...it would still mean that future growth
of the OIL market and industry has to decline or remain static.

An industry without growth prospects will face great difficulties.