Gas and oil prices are rising. Do you really know why? – What happens when oil wells start producing less oil? And they will. This is a question being asked at the highest levels of government all over the world every day. The oil disaster in the Gulf of Mexico propelled global concern for the topic. It may not be headline news anymore, but gas prices surely are, and if you live in the Northeast and heat with oil, your oil bill is probably looking quite a bit different than it did this time last year. Some people who previously had little interest or knowledge about the state of oil are now clamoring for details, not only regarding the economic and environmental impact, but the future of oil drilling, how much oil we have, what comes next and what can be done.
Jeff Rubin: Will car sales rebound to salvage U.S. ethanol targets? – Despite a last-ditch attempt by Senator Dianne Feinstein and others to end the subsidies, the Senate decided to fork out more pork barrel funds to corn farmers and, by extension, to firms like Monsanto and Archer Daniels Midland for another year. But don’t count on U.S. ethanol production ever coming even close to reaching that lofty target of 36 billion gallons per year. If the return of fiscal sanity to Washington doesn’t undercut its life-sustaining subsidies, an aborted recovery in motor vehicle sales will soon put the kibosh on future production growth.
Brazil to replace oil rigs with ‘underwater cities’ – Petrobras plans to turn science fiction into reality to extract oil from the vast pre-salt oil fields discovered off the south east coast of Brazil. The plan is to construct ‘cities’ more than 2,000 metres under water, containing machines, giant pieces of equipment and robots that could inspect the systems being used to extract millions of barrels of oil. Many operations would be fully automated while others would be controlled by humans at a distance. “Our target is that we won’t need platforms in ten years from now,” said Carlos Tadeu Fraga, executive manager of the Petrobras Research Centre. Petrobras already owns virtual reality laboratories where engineers can inspect 3D images of oil fields. But now they want to take a further technological leap by installing floating rig equipment on the sea bed.
Energy: Can We Run Out of Oil and Other Natural Resources? – The reality is that we are in uncharted waters. The world has never, ever seen anything like the rise of major developing countries like China and India—over a billion people growing into the middle class, demanding meat, cars, planes, electricity. Just because we proved smart enough to innovate our way out of periods of past growth doesn’t mean we’ll be able to handle a world with 9 billion plus people by 2050, most of them richer than now. We may already see that impact on the U.S., which will likely have to dig its way out of recession with the added burden of high energy prices thanks to healthy demand from the developing world.
Iran Gasoline Consumption Down 20% Year-On-Year After Subsidy Cut – Iran’s gasoline consumption has fallen by 20% on a year-on-year basis since a four-fold increase in prices came into force, a top Iranian oil official said Wednesday, as a broad overhaul of subsidies hit oil-products use. The gasoline subsidy cut comes after after a U.S. ban this summer on the country’s gasoline imports. Feared riots against the rise have not materialized so far amid cash payments to compensate the less well-off and heavy police presence.
Iran refuses India oil sales on RBI’s terms – sources An oil trading dispute between India and Iran escalated as Tehran refused to sell oil to India under New Delhi’s prohibitive new rules, sources on both sides said on Wednesday. The Indian sources said officials from the central banks of the two countries will meet on Friday as Iran seeks to rescue trade worth around $12 billion a year, which could be jeopardised by rising U.S. pressure on countries trading with Iran to abandon all dealings. Last week, the Reserve Bank of India said deals with Iran must be settled outside the Asian Clearing Union (ACU) system, used by central banks of member nations to settle bilateral trades. Two Indian industry sources said on Wednesday that National Iranian Oil Co (NIOC) turned down Indian oil firms’ request for payments outside the ACU. The ACU includes the central banks of India, Bangladesh, Maldives, Myanmar, Iran, Pakistan, Bhutan, Nepal and Sri Lanka.
Oil crisis looms as RBI stifles Iran oil imports – India may face fuel supply shortage next month after Reserve Bank of India (RBI) stopped facilitating payments for Iranian crude imports, which make up for 12% of the nation’s oil needs. RBI’s sudden move, which came without either the oil industry or the government being consulted, would mean that the nation cannot import 10 million barrels of crude oil contracted from Iran for January, a replacement of which cannot be found easily. “There is a huge crisis staring us. The RBI has, without putting in place an alternative payment mechanism, suddenly withdrawn from a system that was running fine since 1976,” an oil industry official said. “You simply cannot find replacement of such a huge quantity so easily. Plus, once the market comes to know of such a huge requirement, the already firm crude prices will shoot through the roof,”