Oil Headlines

SUBHEAD: Are we ready for the future contemplated in these headline stories? image above: Illustration from source article. From http://i419.photobucket.com/albums/pp278/lost_guitar/EnergyCrisis.png

By Steve from Virginia on 18 October 2009 in The Oil Drum - http://campfire.theoildrum.com/node/5874#more

Saudi Ministry Explains Cuts (Riyadh, Saudi Arabia) Saudi petroleum Minister Ali al-Naimi announced an 11% cut in crude production for export beginning next month and continuing for the next twelve months; adjustment in the total produced for export averaged over the year amount to a total reduction of 9% from the previous year. al- Naimi admitted that Arabian crude reserves have been overstated 'for years' and that current output reduction of six% from last year's production reflects the, "New reality on the ground".

"We have pumped over 60% of our reserves," he stated.

Al- Naimi remarked the Ghawar oilfield was "watered out" and that output from the Khurais field is unable to match the lost production. He also blamed the new law giving Saudi women the right to drive cars for the first time, "This has cut the amount available for export".

"The amount we will export after one year's time will be a further 6% less than will be made available in the announced plan," he said. "We are in a depletion situation, there will be no increase in production from now on, regardless of what we do."

Obama Seeks To Calm Jittery Nation (Washington, DC) The President addressed the nation today asking Americans to remain calm and not rush to gasoline stations to top up gas tanks. The President spoke on television from the Oval Office after the Saudi Arabian government and the Saudi national oil company ARAMCO announced export cuts of crude oil.

"Against a backdrop of shrinking exports from Mexico, Kuwait and other Middle East suppliers and the decline of domestic production, the United States has become much more dependent upon Saudi Arabian crude. Currently, the Saudis are experiencing a short- term, cyclical downturn in production that experts here have assured me is temporary. Our government has offered to provide whatever technical and financial assistance as necessary to allow the Saudis to increase their oil production."

"We ask that in the meantime, that you act and drive normally and not make daily stops to top up your gas tanks. There is currently sufficient gasoline in distribution, and the government is taking steps to release oil from the strategic reserve."

The President looked unusually somber, and did not refer to the prompter or read from notes as he spoke to the American public. Gas Lines Block Highways, Some States Completely Out Of Gas (Washington, DC) Motorists from South Carolina to Oregon lined up for hours at gas stations waiting for gas and diesel fuel. Reports from cities such as Nashville, Charleston, Omaha and Dallas show most gas stations out of gas, with distributors struggling to keep pace with panic calls from retailers for new supplies.

The energy offices of West Virginia, Maryland and Pennsylvania report that demand by individual drivers 'topping up' their tanks have left gasoline stations in those states without any gas to sell at all.

Pipeline operators are reporting difficulty in supplying refined products other than gasoline and diesel. "When the storage at refiners runs out, that's it," admitted a spokesperson for Colonial Pipeline Company. When the refiners are at the end of production, we have to shut down, there will be no more available." When asked how long the pipeline shutdowns might last, the spokesperson replied, "It could be weeks or months. We have to transport a certain minimum quantity, not less, and we cannot obviously transport more than the capacity of the system, although this would be the time to do so."

Police Presence At Retailers (Chicago, IL) Violence has been reported in some areas and police have been sent, some in riot gear, to keep order at stations where waits for gas have been longest. In cities where there is no gas available and no immediate prospect for deliveries, police have been requested to watch for siphoning from parked vehicles and to add patrols to gas stations where owners fear vandalism and theft.

Stocks Plummet (New York, NY) Stocks on the New York Stock Exchange fell today after word that oil supplies in the United States will be sharply reduced. The Dow Jones Industrial Average fell 680 points to 8412 and the S&P dropped to 725. Oil prices were higher on the futures exchanges, rising the exchange limit in the days trading to $115 a barrel.

"A trader remarked, "We are going from a depression to the Greatest Depression. It's been armageddon down here. The Dow will go all the way to zero. Peak oil ... it's real. What can I tell you?"

Matt Simmons on Peak Oil (Houston TX) Peak Oil theorist Matt Simmons explained to reporters on a conference call that, "Peak Oil is real, it's happening, it has been happening, I've been telling everyone about this for years and nobody has been paying attention ..."

Army Commanders Look To Strike Iran (Kabul, Afganistan) American military commanders in Afghanistan have forwarded a strategic option to the Pentagon that includes a rapid strike into Iran to gain control of Iranian weapons of mass destruction. A copy of this exercise report was leaked to the Washington Post, yesterday.

Highlights of the plan include a sweep of areas that contain Iranian nuclear assembly and processing facilities. An aside to this option suggests that support for actions would be 'self supporting' taking command and control of infrastructure needed, including energy producing assets. Commanders have stated that as many as 100,000 US military personnel are in place on the Afghan- Iran frontier with 1,000 tanks and other vehicles, "ready to rock and roll."

Woman Shoots Motorist In Gas Line (Fairfield, OH) A stranded Cincinnati woman waiting for 'several days' for gas at a Fairfield service station was shot to death today by another woman during an altercation. The shooter fled the scene but was apprehended a short distance away by other motorists also waiting in line for gas. Violence and 'line rage' has erupted as gas customers panic nationwide. So far 30 people have been shot to death in gas lines, with dozens wounded.

Energy Chief Calls Peak Danger To Civilization Washington, DC) Queried by reporters why peak oil had not been addressed by his office, Energy chief Stephen Chu replied, "Administration policy, admitting peak oil would have caused the stock market to crash". Chu suggested the solution is, "new technology and more electric cars."

Rolling Blackouts, Riots and Empty Grocery Stores (Tampa, FL) The announcement that US energy supplies will shrink has resulted in panic buying of food and other basic necessities. Rumors of diesel shortages threaten the suppliers to grocery stores.

Home Depot and Walmart outlets across the country are reporting 'Mobs' ransacking shelves taking away all goods considered 'necessities' such as plywood, baby food, toilet paper, bottled water and nails. Police have been called to maintain order, but the police in many areas are being diverted to gas stations and strategic facilities such as reservoirs and pumping stations. Ironically, luxury items such as flat screen televisions and jewelry have been ignored by the throngs of panicked shoppers.

"It was insane, they cleaned us out in about an hour, as soon as the news hit," said a Winn- Dixie store manager in Tampa, Florida. "I just opened the registers, I don't suppose it will matter much ... I've got mine, though."

see also: Ea O Ka Aina: Speech Obama needs to give 10/11/09