|
|
This
much can be stated categorically about the USA these days: the more
distressed our economy gets, the more delusional thinking you will encounter.
People want to assign the cause of their misery to this or that (socialism,
abortion, Jews, the New World Order). People want to believe that their world
is a safe place with bright prospects (climate change is a myth,
we have a hundred years of shale oil). The realm of oil is especially ripe
for misunderstanding, since we depend on the stuff so desperately, and the
world's geology is complex indeed, and then you have to bring math and money
into the picture. But it's another thing when professional propagandists take
the stage and attempt to systematically mislead the public.
Such
is the case with two ersatz bombshells zinging across the web-waves this past
week, fired off by two of the foremost professional liars on the scene. The
first comes from the oil industry's leading prostitute, Daniel Yergin of Cambridge Energy Research Associates (CERA),
owned by the mammoth HIS consulting company. CERA is the main public
relations shop for the oil industry. Its mission is to blow smoke up
America's ass in order to keep investment dollars flowing into oil companies
because oil companies prefer to use other people's money to perform their
risky operations. They make a lot of money themselves, and accumulate it
diligently, but they are not so foolish as to squander it on dry holes and
adventures in alchemy.
So,
last week Daniel Yergin came out with a blast in
the Wall Street Journal affecting to debunk peak oil. His own theory is much
like Irving Fisher's economic theory set out October 21, 1929 that
"stock prices have reached what looks like a permanently high
plateau." Three days later, the markets crashed and the Great Depression
commenced. Yergin says we've hit a permanent
plateau for oil production. He is pimping for a bonanza in shale oil, tar
sands, and other innovative ventures in picking "fruit" that is not
hanging so low anymore. He says:
"Meeting future demand will
require innovation, investment and the development of more challenging
resources. A major reason for continuing growth in petroleum supplies is that
oil previously regarded as inaccessible or uneconomical is now part of the
mix, such as the "presalt" resources off
the coast of Brazil, the vast oil sands of Canada, and the oil locked in
shale and other rocks in the U.S."
Spoken
like a true PR whore. Translation: give us money. Calling all investors. Give
your dollars to the folks working the Bakken play,
or Eagle Ford down in Texas. These shale plays represent oil that is trapped
in "tight," low-permeability rock that has to undergo fracturing
operations ("fracking") before you can
drain it out. It costs a lot more to get oil this way than by sticking a pipe
in the ground and running a pump-jack to get it out the old-fashioned way.
There are more than a few dirty secrets about the shale oil plays, but the
biggest one is that you have to throw a huge amount of capital and steel at
it to keep it running as an ongoing enterprise, and that money - other
people's money - will be in shockingly short supply in the years head.
Those
troubles you hear distant rumblings about in places like Greece, Portugal,
Italy, Spain - that's the sound of the world's money
whooshing into a black hole, which is what happens when debts are not repaid.
Something very similar is happening in the USA, where all the unresolved
mega-borrowing of the past thirty years is whirling down the drain, never to
be seen again, and a craven corporate oligarchy (there, I said it) is working
tirelessly to hoard the last remaining vestiges of money before it either
deflates across that event horizon, or inflates away to nothing by digital
multiplication. In either case the result is the same: you're broke.
Here's
the truth about the US shale plays: they will never amount to more than about
one million barrels-a-day (m/b/d) in production under any circumstances (the
nation uses 19 m/b/d); and even more probably the money will not be there to
keep the shale oil coming very many years into the future. You can take that
to the bank (if your money has any value when you get there, and if the bank
has not cratered).
In
our fugue of techno-narcissism, America wants to believe that we can just
keep on being what we used to be, pizza, DisneyWorld,
WalMart, and all. So, the second big buzz of the
week came courtesy of Goldman Sachs, in a sloppy press release saying America
would be the world's top oil producer in 2017, at 10.9 m/b/d. The effrontery
of these thieving pricks! They apparently pulled the information out of chief
Goldman flack Lucas Van Praag's ass. One might
infer that Goldman Sachs is campaigning to raise money for the oil industry
by suggesting a bonanza is underway. It's a crude ruse. The actual
"confidential" report - as opposed to the brief summary in the
media - shows that Goldman Sachs arrives at this position by referring to
non-oil substances as oil. Neat trick. Be sure to call Goldman Sachs to
invest your remaining savings in algae secretions and ethanol.
No
doubt, though, that these two PR offensives will accomplish their secondary
mission: to gird the hopes and wishes of the political right-wing, who are
hell-bent on keeping this country from entering a plausible future. Watch these ideas take flight and wonder that you
live in such credulous nation.
|
|
