Gold looks bad

[lektrode]

Re: Gold looks bad

no sweat, thanks - glad to see something/anything else is goin on sides sittin here...
(not that i'm complainin - altho me other 1/2 is - and getting louder... ;)

[GRG55]

Re: Gold looks bad

There is no doubt that technology is and will continue to play a role in unlocking more and more difficult (and therefore generally more and more expensive) energy and other resources to meet human population growth and demand. The price mechanism will allocate higher cost resources reasonably efficiently, and governments, with widespread popular support from most citizens, will create shortages in their well meaning but misguided attempts to introduce "fairness" to that allocation process.

GRG55, no offense, but do you really and truly hold such a view, opinion, belief, or whatever? Its a tad naive - to say the least. But there you go, as they say. However, your last bit about govs is correct...

Yes. And in my more than 35 years in the petroleum business the historical facts that support this view are irrefutable. Including what is happening right now in North America. Technology continues to unlock oil and gas resources that were out of reach to us just a decade or three ago. Ultra-deep water. Sub-salt deposits worldwide. Tight gas. Shale oil. Commercial scale GTL. SAGD recovery of oil sand deposits too deep to mine. Is all this stuff economic? Depends on the price of the commodity and how fast the technology improvements are advancing. But in the oil industry what was uneconomic yesterday often has a tendency to become economic tomorrow...even when the commodity price is falling (witness all the advances in oil exploration and production technology between 1980 and 1999 - a time of almost continuously falling oil price). As for the price mechanism allocating oil consumption...that too is happening at this very moment. All the low value uses of oil have steadily been squeezed out as oil rose, first in the 1970s and again since the start of this millennium. Unless it is government subsidized (like gasoline in the Persian Gulf countries) $100 oil is a LOT more effective at knocking out wasteful consumption than $20 oil ever was.

But as they say, past performance is no guarantee of future results, so there's certainly ample room for constructive disagreement on the topic of advancing technology and the unlocking of more petroleum (and other essential) resources.

[bpwoods]

Re: Gold looks bad

@ GRG55: Thanks for that reply. Fair enough. I love the little guy with the flag!

but ...." ... historical facts that support this view are irrefutable." Now being of a Popperian frame of mind ...

As a matter of interest - and you may wish to hold over any reply to some other (energy related) thread; the dollar costs of extractions from non-conventional sources: would be? The energy input cost (ie in bbl of oil or BTUs or Joules) for non-conventional sources, and the nett energy available for sale on open market: would be? I've seen some estimates and they are not particularly comforting. Presumably if the wholesale dollar cost of liquid hydrocarbon fuels were to decline it might have a neg impact on the willingness of exploration and production companies to maintain their effort? They are hardly likely to go into debt, knowing that they will have difficulty paying the interest due?

Cheers for now. We WILL be back at this one. Guaranteed!

[jk]

Re: Gold looks bad

@ GRG55: Thanks for that reply. Fair enough. I love the little guy with the flag!

but ...." ... historical facts that support this view are irrefutable." Now being of a Popperian frame of mind ...

As a matter of interest - and you may wish to hold over any reply to some other (energy related) thread; the dollar costs of extractions from non-conventional sources: would be? The energy input cost (ie in bbl of oil or BTUs or Joules) for non-conventional sources, and the nett energy available for sale on open market: would be? I've seen some estimates and they are not particularly comforting. Presumably if the wholesale dollar cost of liquid hydrocarbon fuels were to decline it might have a neg impact on the willingness of exploration and production companies to maintain their effort? They are hardly likely to go into debt, knowing that they will have difficulty paying the interest due?

Cheers for now. We WILL be back at this one. Guaranteed!

this issue has been discussed at length, in many threads extending over a period of years. the bottom line is that energy in/energy out analysis isn't especially relevant if you're transforming non-mobile energy sources [coal, nuclear, and to some degree gas] into highly energy-dense liquid fuel destined for transportation uses. and the other bottom line has been that periodic rises in the price of energy can/will trigger recessions leading to oil price drops and the cutting back of new e&p, and perhaps even the shutting in of some current production. this will result in some loss of resources available for economic exploitation on the next upswing, and will require ever higher oil prices to justify future e&p.

[bpwoods]

Re: Gold looks bad

Thanks for the reply. Like I said, "We'll be back at this" - despite the fact that we have been here before. Its a tad problematical.