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What will gas cost when the Volt arrives?

7K views 22 replies 5 participants last post by  hermperez 
#1 ·
I'm sure we've all noticed how gas prices are rising weekly again for the last couple of months, but that's just the beginning.

If you ask the experts, the Saudis. We're pretty much screwed. Anyone on the forum who was thinking of buying another SUV for those occasional offroading trips you decide to go on, my advice to you is that you will be very sorry. You might be better off renting one for the weekend.

Possibly good news for GM if they were hoping to make money on the Volt. Bad news is that the economy will be taking another punch in the gut and the auto market is sure to keep falling off this cliff.

http://www.cbc.ca/money/story/2009/05/26/oil-prices-saudi-arabia-2009.html
 
#2 ·
Good question, about gasoline prices.

Yes, Americans are still thinking of vehicle purchases in terms of 'performance', or 'seating capacity' or 'sitting high from the road', whatever, things that mattered in the 20th century.
They haven't really been warned to start thinking in terms of '$5 to $7 gasoline', or 'gas rationing', or 'no gas today'.
Many people think that the $147 peak in oil prices in 2008 were due to "speculation", and haven't heard about the underlying geological facts of mega oilfield peaking and depletion. You always read about 'hey, they just found 3 billion barrels of oil, possibly, off the coast of X at a depth of Y thousand feet", but not so many stories on megafields declining at 6% per year.

For example, Mexico's megafield Cantarell:
Production decline

Luis Ramírez Corzo, head of PEMEX's exploration and production division, announced on August 12, 2004 that the actual oil output from Cantarell was forecast to decline steeply from 2006 onwards, at a rate of 14% per year. In March 2006 it was reported that Cantarell had already peaked, with a second year of declining production in 2005. For 2006, the field's output declined by 13.1%, according to Jesús Reyes Heróles, the director-general of PEMEX.

In July 2008, daily production rate fell sharply by 36% to 973,668 barrels per day (155,000 m³/d) from 1.526 million barrels per day (243×103 m3/d) a year earlier. Analysts theorize that this rapid decline is a result of production enhancement techniques causing faster short-term oil extraction at the expense of field longevity. By January 2009, oil production at Cantarell had fallen to 772,000 barrels per day (123,000 m³/d), a drop in production of 38% for the year, resulting in a drop in total Mexican oil production of 9.2%, the fifth year in a row of declining Mexican production. Pemex expects Cantarells decline to continue to 2012 and eventually stabilizing at an output level of around 500,000 barrels per day (80,000 m³/d).
http://en.wikipedia.org/wiki/Cantarell_Field

Peak Oil is an unpleasant subject, which the smiling, talking heads on American TV News don't want to touch:
http://www.peakoil.net/

The Europeans are a bit more realistic in the issues they consider "news":
http://www.independent.co.uk/news/science/warning-oil-supplies-are-running-out-fast-1766585.html
Dr Fatih Birol, the chief economist at the respected International Energy Agency (IEA) in Paris, which is charged with the task of assessing future energy supplies by OECD countries.

In an interview with The Independent, Dr Birol said that the public and many governments appeared to be oblivious to the fact that the oil on which modern civilisation depends is running out far faster than previously predicted and that global production is likely to peak in about 10 years – at least a decade earlier than most governments had estimated.

But the first detailed assessment of more than 800 oil fields in the world, covering three quarters of global reserves, has found that most of the biggest fields have already peaked and that the rate of decline in oil production is now running at nearly twice the pace as calculated just two years ago. On top of this, there is a problem of chronic under-investment by oil-producing countries, a feature that is set to result in an "oil crunch" within the next five years which will jeopardise any hope of a recovery from the present global economic recession, he said.

In its first-ever assessment of the world's major oil fields, the IEA concluded that the global energy system was at a crossroads and that consumption of oil was "patently unsustainable", with expected demand far outstripping supply.

Oil production has already peaked in non-Opec countries and the era of cheap oil has come to an end, it warned.

In most fields, oil production has now peaked, which means that other sources of supply have to be found to meet existing demand.

Even if demand remained steady, the world would have to find the equivalent of four Saudi Arabias to maintain production, and six Saudi Arabias if it is to keep up with the expected increase in demand between now and 2030, Dr Birol said.

"It's a big challenge in terms of the geology, in terms of the investment and in terms of the geopolitics. So this is a big risk and it's mainly because of the rates of the declining oil fields," he said.

"Many governments now are more and more aware that at least the day of cheap and easy oil is over... [however] I'm not very optimistic about governments being aware of the difficulties we may face in the oil supply," he said.
The IEA estimates that the decline in oil production in existing fields is now running at 6.7 per cent a year compared to the 3.7 per cent decline it had estimated in 2007, which it now acknowledges to be wrong.


People will soon learn that being able to use electricity to run your vehicle is very helpful, and that a luxury V8 car is just driveway art if you can't get gasoline that weekend.
 
#3 ·
Roll the dice or spin the wheel. What point in the recovery / crash cycle will we cross on that fine day is anyone's wild ass guess.

If we get lucky it will be after the green shoots take hold and the world economy is coming back up but not quite at the 86 mbd petroleum consumption level. Just as the reserves start getting pinched would be ideal. This will be the start of the rapid gas price rise. Then the Volt will look like a bargain. However, it must be before the gas price gets too high because people might figure out we hit peak oil and then nobody is going to be buying cars.

If we past that point a bit the gas prices would have already spiked, scared the hell out of everyone and crashed the global economy, again. Then we could be back to $30 / barrel oil, again. Will consumers forget, again? Yup. Just give them a year or two and the summer of 2008 will be but a faint memory. It’s like watching someone get up after running into a window only to do it again. Entertaining.
 
#4 ·
Do you think price of gasoline will be the only consequence of stagnant or declining supplies of crude oil, worldwide ?

I wonder if the U.S. would go the rationing route, so that people could still drive to work. Like WWII coupons, you get 10 gallons/week per family or something...
I heard that when gas was over $4/gallon, even over $5/gallon in some parts of the country in summer 2008, that some small town people couldn't afford to drive to work. Some were commuting something ridiculous like 100, 200 miles/day to their job in the nearest city, in their trucks, and they didn't have the capital or credit rating to change their vehicle on a summer's notice (what the economists call 'inelastic demand')

A lot of people grew up with $1 or $2 per gallon gasoline, and still look at trucks and SUV's with these 20th century expectations, and think those are 'normal' prices. If your commute was $50/week at $1/gallon, 10 years ago, then $250/week is a huge jump for a low income worker. This will affect who lives where for what jobs.

Anyway, I have no idea how rationing would work. I think in WWII, prices remained about the same, but you could only get so much. Americans today probably would reject that concept - at least, the Americans who influence Congress the most.

But if gasoline price goes through the roof in 2012, 2014 - $5, $7, $10 - who knows what measures people will put up with.

Either way, the Chevy Volt is well positioned to keep most people commuting, and going about their errands, for everyone with access to non-oil produced electricity. Which is most Americans. And it still allows long trips when necessary (and the gasoline is available).
 
#5 ·
This is why I think the Volt sales will do great. It's admittedly questionable as to whether the Volt makes "economic sense" as far as ROI for gas savings...right now! But more and more people are talking about peak oil all the time, and save for a few right wingers (and sometimes left wing global warming nuts), most people can read a couple of articles like you just posted, Geronimo, and get a butterfly or two in their stomach that gas prices are on a one way course to the stratosphere, especially after watching gas prices jump so far so fast in the last few years. So if gas prices stay low, you have a lot of far lefters afraid of global warming with reason to buy, and middle of the road people who understand our oil production situation getting into a Volt as they're thinking "I'd better prepare for the future since it's anybody's guess as to what gas prices will be in 2 or 3 years", and when gas prices really do go to the moon, everyone, even the hard core right wingers will have to buy them.
 
#9 ·
we must start an emergency drilling program right now, everywhere!.. and hopefully Iraq can finally crank up production.. we may have to double-triple our military presence in Iraq. Relax environmental regulations for the the next 20 years or so.

It has become an emergency and no NIMBYs or environmentalist suicide fools should be allowed to interfere.. they were right but circumstances are dire.

Yes, conservation and alternatives must also be cranked up but we are already doing that at a pretty good pace.. many conservation measures can be implemented.. no air conditioning and restricted heating, mandatory sterilization and speed limits on the hwy lowered to 45mph.. and car pooling is mandatory. We also need massive taxes on beef and pork (chickens are actually pretty efficient) to discourage too much consumption. Dont forget oil is a major component of food production.. losing some weight will be good for most americans.

We can avert this impending catastrophe, but we must all work together..
 
#10 ·
we must start an emergency drilling program right now, everywhere!.. and hopefully Iraq can finally crank up production.. we may have to double-triple our military presence in Iraq. Relax environmental regulations for the the next 20 years or so.
If "emergency drilling" postpones Peak Oil from 2012 to 2015, what has that bought us ? More wealth tied up in oil wells, and less invested in what will be the necessary after Peak Oil.

See above for the "preparing" concept...
 
#11 ·
hermperez: "we must start an emergency drilling program right now, everywhere!"

Run out of oil first. Interesting plan. Lack of oil is what killed the Third Reich and Imperial Japan in WWII. Did you know that?

Well, that way people can still drive their sport utes and power boats for the next few years without being punished by high gas prices.

hermperez: "and hopefully Iraq can finally crank up production.. we may have to double-triple our military presence in Iraq."

Oh. So, we did kill a few hundred thousand Iraqis just to get access to cheap oil? Well, it seems the enemy propagandists were right, after all. Who knew?

I mean, it's not like Iraq's oil should be used to further Iraq's interests, right? No, no, it's ours, it's just inconveniently located under their otherwise worthless country, right?
 
#12 ·
Hermperez, that was a GREAT post :).

I was laughing about half way through when I read about mass sterilization programs. What do you think, IQs below 70 get sterilized? It's not like we're killing them, we're just assuring that our gene pool remains undiluted. Hehe, all those ideas actually sound pretty good except that the Republican party (with the balls) are in the minority now :-(.

There really isn't anything wrong with Iraq using their oil. They have the 3rd highest proven oil reserves in the world and it's largely untapped. Those people have lived under a dictator for decades and why shouldn't they be able to sell their useless black goop that goes for $75/barrel?
 
#13 ·
There really isn't anything wrong with Iraq using their oil. They have the 3rd highest proven oil reserves in the world and it's largely untapped. Those people have lived under a dictator for decades and why shouldn't they be able to sell their useless black goop that goes for $75/barrel?
I would bet Iraq has the 2nd highest reserves in the world, maybe even 1st.

Canada counts its' oil sands, which technically contain 'oil', but you can't pump them like crude oil - you have to mine and process it, like ore. So forget that - you can't produce quickly, and the bottleneck for scaling up is the Athabasca River (how much water they have for processing).

Iran increased its "reserves" from 99.1 billion barrels to 130.7 billion barrels in 2002 (with no discoveries), whereas Iraq has stayed at 115 billion barrels since 2001. OPEC stated reserves (which are not subject to outside authentication) are the basis of how much oil each country is allowed to pump per year.

http://en.wikipedia.org/wiki/Oil_reserves#OPEC_countries
Dr. Ali Samsam Bakhtiari, a former senior expert of the National Iranian Oil Company, has estimated that Iran, Iraq, Kuwait, Saudi Arabia and the United Arab Emirates have overstated reserves by a combined 320–390bn barrels, and "As for Iran, the usually accepted official 132 billion barrels is almost one hundred billion over any realistic assay". Petroleum Intelligence Weekly reported that official confidential Kuwaiti documents estimate reserves of Kuwait were only 48 billion barrels, of which half were proven and half were possible. The combined value of proven and possible is half of the official public estimate of proven reserves

The case of Saudi Arabia is also striking, with proven reserves estimated at between 260 and 264 billion barrels in the past 18 years, a variation of less than 2% while extracting approximately 60 billion barrels during this period.​
So, OPEC plays its games with "reserve estimates" for political and economic reasons.

And although Saudi Arabia has been thoroughly explored for decades with the most sophisticated methods known to the West, Iraq has not been so explored since the 1970's. Many experts think there could be some megafields lurking in the desert that would make Iraqi actual reserves larger than Saudi Arabia's, once they get their equipment in there to explore properly. Iraq also has the cheapest-to-produce oil in the world, so the American and British companies were pleased that the dictator would not turn over his hidden WMD to the UN, giving them a casus belli to topple him and cancel all those concession contracts given to other countries like China. What luck.

Here's a reasoned American analysis from May 12, 2003 (12 days after the Iraq War was won):
 
#17 ·
Geronimo, I will do anything (and so will your elected officials) to get an extra 6 months of not starving.. and if the worlds economy gets disrupted enough that may turn out to be good for a lot longer.. after all we waste a lot of fuel.

How many nukes we have in inventory?
 
#19 ·
Geronimo, I will do anything (and so will your elected officials) to get an extra 6 months of not starving..
I'm glad to hear it.

Some people are actually shortsighted enough to bitch and moan about spending slightly more for their electricity now, to prepare for the fast approaching time of declining petroleum production. Or for subsidies which will jumpstart an industry making vehicles that use electricity in place of petroleum products. But even squirrels are smart enough to get ready for approaching hard times...

If there are enough people like you and those elected officials willing to do anything, I'm sure we'll make it through the crisis with no starving or global disasters - the ingenuity and possibilities are there, we only need the political will to get it done.
 
#22 ·
Uranium has a density of 19 metric tons per cubic meter, so a cube of 12 meters per side will hold the existing 38,000lbs of high grade nuclear waste in the US.. it would be much less if we reprocessed it but we dont.

Its not stored in a huge lump due to the heat it generates.. it has to be spread out or cooled under water or it melts (or worse).
 
#23 ·
it would take a long time for it to sink past the crust, by then much of the radiation would have dissipated.. but you could speed it up by drilling. Uranium is 8 times denser than magma under high pressure but I would think it would melt and mix in short order... its probably very turbulent down there.
 
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