Press review 26-12-2015 - The year petroleum peaked?

The EIA published this week their petroleum extraction figures for September, presenting a world wide reduction of 0.5 Mb/d from August. This inversion into decline during the summer is now present in all publicly available datasets; the cries of "Peak Oil" grow louder. As usual I prefer a cautious tone, Iran, Iraq and Libya sum together several Mb/d of unrealised potential at this point; eventually it may invert the extraction profile once again. However, regarding where prices and stocks are presently, one can not possibly rule out 2015 as the terminal year for petroleum.

In spite of these data, in my view the Sunni-Shiite war in Iraq and Syria remained the major story of 2015. With dozens of countries involved in one way or another, this war is building into a focus of tension unprecedented since the Iranian revolution. The past few years I have tried in this reviewed to answer a simple question: is Europe on the right side in this war? But is it even clear on which side are we? The article that opens this last review of 2015 dives deep into this war, showing that things are not at all straightforward and that perhaps Europe is really wrong footed, embroiled into a trap of its own making.

An hiatus to the press review is likely to follow; details are at the end of this note.

Press review 19-12-2015 - Sour Christmas

Declining numbers of visits to this weblog tell me a lot folk are getting busy with Christmas, either travelling, shopping or both. However, this will be a bitter Christmas for many families that are one way or another dependent on the energy industry, petroleum and gas in particular. The US Federal Reserve flagged a major turning point this week with a return to interest rate hikes. Currencies and commodities sank against the dollar across the board, confirming that the current market is here to stay a while longer. Of the more than 300 000 folk that lost their jobs in this industry since 2014 few will ever make it back; search for a new a career they must.

I feel the best word to describe what is going on in middle management, administrative boards and petroleum ministries is panic. The market is out of control and no one - really no one - is safe at 37 $/b. From small to large companies, from multinationals to governments, everyone is bracing to what will be the deepest contraction of the petroleum (and gas) industry at least since 1985.

Here in Europe consumers are now paying the lowest prices in a decade for petrol and diesel. Enjoy it while you can. Petroleum will eventually come back in vengeance.

Press review 12-12-2015 - Under 40 hangover

This week felt somewhat like an hangover from the hectic events of the previous week. The chaos in which the OPEC meeting of the 4th ended only produced its full effect this Monday, with another collapse in petroleum prices. The Brent index resisted for a few days, but would eventually break under 40 $/b, to close the week at 37 $/b. The media warns in unison of an impeding financial disaster with the energy industry; but so far banks keep feeding money to a large numbers of companies that are essentially dead. How will this all unfold is hard to tell at this moment, but some sort of bailout is more than likely - possibly through the banks themselves.

Meanwhile, the whole "peak is here" talk is back once again in the wake of a small decline in the global production of liquid agricultural products. In what fossil liquids - petroleums - are concerned, extraction is still growing strong; even though hard data for the last quarter is not yet there, preliminary assessments point to something very close to 81 Mb/d by now. From the summer of 2014 until now world petroleum extraction grew 5 Mb/d, more than it grew the whole decade before that.

However, I recognise 37 $/b will leave their mark. The petroleum industry is essentially shutting down, and even with Iraq and Iran replacing the coming extraction collapse in North America, the decline will eventually set in. It might become already visible in late 2016, but will be certainly marked in 2017 and 2018. Will that be the much dread "peak oil"? Far too early to tell.

Press review 05-12-2015 - Eruption

Once in a while an old meme pops up in the media claiming the war in Syria was caused by CO2. One may certainly wonder what sort of gases are making into the brains of some world leaders, but one thing is certain, regardless of how it started, the war in Syria and Iraq is being fuelled by petroleum. Far from surprising to regular readers, fresh claims from Iraq and Russia that Turkey is trading in crude from Daesh provide an important update: back in August the caliphate was selling over 200 kb/d.

The western media remains largely reluctant in reporting this aspect of Turkey's involvement in this war, and even goes as far as claiming that Daesh is actually selling petroleum to its Shiite foe in Syria... Even the claims on CO2 are more credible.



There has not been a week like this in quite a while, with relevant developments on almost every front. The world seems erupting and energy plays a central role, as always. Most remarkable this time is the rise in geo-political tension meeting a deeply depressed energy market.

Press review 28-11-2015 - The other side of the barricade

I was born during the last years of the cold war, and even though I was quite young, I remember vividly the permanent tension between East and West, in particular through the conflicts in Africa and the Middle East. Even considering those times, I can not recall a military incident bringing these secular blocks so close to an armed conflict as that lived this week.

In this sort of events there are usually two different sides of the same the story, not being easy to tell who is who. However, in this particular occasion it is rather easy, especially after the publication by the Turkish military of the map reproduced here. The invasive trajectory claimed in the Turkish account of events stretches for no more than two nautical miles. Even if this trajectory is correct, and even if the Su-24 was cruising at sub-sonic speeds, the Russian aircraft spent less than 15 seconds in Turkish air space. The Su-24 was shot down over Syrian territory and in all likelihood the Turkish F-16 entered there to do so.

Turkey is sending a message, not only to Russia, but in particular to its European NATO partners. Turkey is not willing to give hand of its acquired position in the region. It is not willing to give hand of the human, petroleum and arms trafficking businesses; it is not giving hand of its will to remove the Shiites from power in Syria; it is not willing to allow the rise of an autonomous Kurdistan; it is not giving hand of the will to expand further the territory it took from Syria after the II World War.

It is becoming clearer who is on the other side of the barricade. Rest to know if Europe remains committed to fight and win this war.

Convergence Preview - 03 - Progress

Pretty amazing, I am actually writing this from a Chrubuntu install on the Tegra K1, and more spectacularly, with the Unity desktop environment. There is still a number of things malfunctioning, the road ahead is long, but this is a capital step in this project. Below the fold I detail this latest chapter of the story.

But already one of the most important milestones in this project has been achieved: performance. As a matter of fact, I feel no difference in terms of interface usability in contrast to my usual work environment. Moving windows around, sending them to other workspaces, shifting between workspaces, using the HUD and Lenses, all is fast and fluid. The Tegra K1 is proving an able CPU for desktop work, but for a fraction of the cost, space and power.

Press review 21-11-2015 - War

In the space of ten days, Daesh was able to successfully attack civilian targets from three different countries well outside its territory. The death toll of these three attacks sums almost 400 and could unfortunately pass that number. It is sad to see pragmatism towards Daesh settling in only after such events.

I live a few hundred meters from the French border, the state of emergency has been quite visible: heavily armed police in train stations, chronic traffic jams imposed by border checks. President Hollande was not exaggerating when he used the term war. But in face of the precipitous bombing of assorted targets in Raqqa, I wonder if the French government is exactly aware of the kind of war it is fighting.

I have postulated various times that geo-political events have more potential to shape the petroleum extraction curve in the short term than geology by itself.