Does the map just list stations out of both Diesel and unleaded, or just one of them, as its missing at least one station that ran out of unleaded if its the latter?
There are 9000 petrol stations in the UK. They're generally run either by supermarkets, or by oil companies. These guys don't screw around. On that basis yeah, I'm making the leap that petrol station capacity to population size must remain roughly constant. It's an assumption based on the smooth working of capitalism. As for higher consumption in richer areas, this seems a natural assumption to make. We all know who's buying Merc S class's now don't we. It isn't your local chippie in Scunthorpe. Nevertheless, there are enough wealthy people and poor people in areas the size of which we're inspecting here that while higher proportions of wealthy people may be a factor, I'm not convinced it's the primary one. I know not. Just found it in an article on the Economist.
There are economic political factors in the answer. First of all, political hay has been made out of "known reserves" going back to the 1940's. In almost every case, the statement was "We have only 20 years of supply based on consumption and known reserves" Every time they have been rebuked by... wait for it... an increase of known reserves. You're not going to like this answer but the reality is that an increase in price also incentivizes the exploration of new reserves. No one is going to spend billions of dollars looking for more reserves if the price is $2.50/gallon or $30 a barrel if they can supply the current supply with know reserves. It complicates things further when you realize that oil has different types which require different methods of extraction/delivery/refinement. That is why several wells were capped in your neck of the woods in the 1960's because other sources made oil too cheap to make it worth taking out of the ground in Texas. Donald Rumsfeld got ridiculed about this line at the time but there's some seriously useful wisdom that applies universally and has some relevance to this discussion: It sounds like circular logic but it is not. In regard to oil reserves, much is touted politically of the known knowns while ignoring the unknown unknowns which have consistently been shifted to the known known category several times historically. You can only price what is known. Another interesting fact while people whine about the price of gas is that if you look at the average price vs the rate of inflation, gas is one of the best bargains on the planet, relatively speaking. Oil companies have pulled of an economic miracle delivering this highly demanded product under the rate of inflation but are seriously unlikely to get any accolades. If I'm being honest, I'm astonished that the rest of the world isn't blaming US monetary policy for the woahs they are paying at the pump. It is one of the largest global robberies ever done and we only skate by due to ignorance. There are some theories about our wars in Iraq and Libya over oil but not the way people think. In both cases, it wasn't the threat of cutting off the supply of oil but both Hussein and Gaddafi threatened to trade in oil in anther denomination other than US dollars and not long after each episode, war were declared. In regards to alternative fuels, I recently read a report that fuel would have to rise to $12.50/gallon for the Chevy Volt to be economically viable. That will likely evolve down assuming that the industry continues to spend the same rate of research (although there is another argument that battery technology has hit a wall of sorts). This scare in the UK has happened in the US as well and reveals an interesting side of economics of the psychology of human behavior. The run on the banks in the 1930's ran on the same panic fuel and need not happened but the reaction to the panic by the federal reserve and some key banks were in direct violation of one of the key fallacies of economics which is the "Chess Piece Fallacy" which deals with human psychology more than the scarcity of limited resources that have alternative uses but one that has serious economic consequences if ignored.
Why wouldn't I like that answer? I think it makes sense, actually. I've heard similar ideas regarding the price-per-barrel of oil driving research into alternative energy. While we criticize oil companies for wanting prices (and therefore, profits) as high as possible, the truth is that even oil company executives understand that if the price gets too high, then it creates an incentive to look for an alternative. The key is keeping the price high enough to make a good profit, but low enough that most people just grumble and continue to pay. My point, however, is that oil is a finite resource. It may be true that "known reserves" are expanded year after year, but at some point we actually will hit peak oil. My original question was based more or less on that idea, and I was just curious if anyone else had any guesses as to how far off that may be. Again, I agree with your assessment. There was an insightful report on NPR this morning in which Fred Smith, founder and CEO of FedEx, shared his thoughts on the oil situation. What struck me is that in the realm of political ideologues, the far-right often criticizes hybrid vehicles as some tool of the leftist hippie while the far left criticizes corporations for being profit-hungry monsters. Yet this report featured the CEO of a major global corporation fully touting the benefits of hybrid vehicles and supporting research into algal oil. This appears to be one of those examples in which competition in the private market will end up driving innovative research better than the government.
Looked at a couple of the comments on the selected petrol stations in fife, and it looks to be user submitted comments such as Long queue. so perhaps the first thing that needs looking at with that map is user population with smart phones.
Just because it's not a clear-cut simple answer, not that you would disagree with it or anything. Oil companies only care about the price per barrel so far as at some point customers consume less. Oil companies would prefer a low price because their profit is pretty much a flat amount (around $.06/gallon)whether it is being sold at $2.50 or $5 so they benefit more from volume than price. The other critical point is that they don't control the price, it is a global market. Most companies that refine and distribute gasoline in the US don't actually pull it from the ground, they buy it on the open market, so they have virtually no control over the price. Also, while oil companies make around $.06 for every gallon of gas that THEY produce - depending on the state you are in, the government makes about $.36 on the same gallon ($.25 of that is federal) so when people grip about greed, they should focus their sites on the entity that is taking the biggest bite. I can honestly say that no one on this planet really knows how much we have. Another interesting question "Is more oil currently being produced underground?" Remarkably no one really knows that either. Everyone thinks that oil is produced from rotting dinosaurs and that when they died they turned into oil several millions of years later and when we use that up game over. That's a fairy tale. Of course Fred Smith wants alternative fuels, because he needs as much J-A fuel he can get his hands on to power the backbone of his business - cargo planes. If demand drops in other sectors, it benefits him. Just a few years ago, the future of jet travel was going to be bio fuels, that has pretty much disappeared due to unintended consequences. I have no problem with alternative energy sources. I have a BIG problem with people who know nothing about energy using other people's money to subsidize the development of it. I agree with you that we need to leave it to the private market - shocker We've had a similar discussion about this before regarding Warren Buffet and how you should take his opinion with a grain of self-serving salt and not only hear what they say but watch what they do. One unique opportunity is listen to someone like John Hofmeister (former CEO of Shell Oil) who has nothing to lose by shooting his mouth off now as opposed to be pulled in front of a congressional hearing for high gas prices). I'm not saying his word as gospel merely consider the current incentives and constraints that influence who is speaking at the time.
Honestly, this is the first time I've ever heard that opinion - from either side of the argument. Why do you say it is a fairy tale?
People only speak based on known information. If known reserves represented the only amount of oil on the planet, why would we be still exploring for it, and more importantly, finding it. Of course, some will say that we have found all the easy oil to find and, to some degree that may be true. But no one knows how much stuff is in the ground. People speculate based on known facts. The problem is, they've been doing that for almost a century and have been wrong every, single, time. The fairy tale is this: Long ago dinosaurs lived and died suddenly, over time all of that matter became oil. So when we use up all of results of that era in history it will be gone. Hence the term "fossil fuels". What happened to all the organic material the day, years and millenia after that? The true source of oil is actually quite a mystery. Did the geological forces that created the oil that we find today suddenly stop? My point is there are a lot of unknown unkowns yet people have been unsuccessfully postulating with not doubt in their opinion that they know. I'm not arguing that is not scarce with no end in sight, just that so many people have been estimating this finite supply for so long and not one single person has been right. I looked into this in great detail a while back but just some cursory interneting yields interesting results on both sides of the argument. The simple facts are that headlines "We're running out of Oil" sell of lot more papers than "Everything is fine, drive to the beach" and, even worse, is that politicians are more than willing to pounce to use their position to pick new winners, especially if they contribute to their re-election campaigns.
Fair enough. I'm not sure I fully agree with this part. It's true that biogenic and abiogenic oil sources have been discovered, but it is also true that abiogenic sources have not been discovered in economical amounts. I see your point that the geo-biological processes that convert organic matter into oil didn't just stop after the dinosaurs died off (nor did dinosaurs really just come to an abrupt end, but that's a lesson for another science class) - it is believed now that the vast majority of biogenic oil comes from microorganisms rather than dinosaurs. However, it does appear as though our increased demand is causing more oil to be pumped at a faster rate. The evidence is in the fact that the companies responsible for exploration, drilling, and pumping are having to go farther afield and deeper into the ground, with increasingly technological solutions (with increasing costs) because (most of) the readily available stuff is gone. If oil really was as plentiful as some claim, oil companies wouldn't have to spend so much money to get oil out of the tundra. I guess my question should then be modified: Rather than relying on the peak oil scenario, at what point does the price of extraction and production of oil become high enough to create an incentive for alternative energy research (presuming economies of scale would apply after alternative energy becomes ubiquitous, therefore reducing prices).
I agree with Nick Nexxo ....now if only I could come up with some sort of catchy slogan good enough for him to get into political office.
The good old petrodollar cycle. I believe the Bush administrations sabre rattling with Iran happened shortly after they suggested OPEC should sell oil in Euros. When my wife worked for one of the big global producers all their projects where priced at a set price per barrel which was surprisingly low when you look at todays prices but not when you consider the long time scales of the projects. I can't remember the exact figure so I will use the price of $25 per barrel. All projects, exploration, production and expansion had to make a profit at that price per barrel. If the oil cost was $70 per barrel then that was all extra profit.
Good point on the being able to predict pricing for long-term arrangements. I was speaking more directly to the gasoline distribution side which can adjust pricing a little more freely.
I agree that the rate of consumption is relevant to the rate of new production. Thanks to the market, we do know how much we are consuming globally. Especially considering that I think it is safe to say that IF the earth is constantly producing more oil, it is probably at a constant rate vs. the rate of consumption has steadily risen. My point is that we don't as much about the supply as some are led to believe. Abiogenic oil is a relatively new phenomena that very little is known about. There isn't even a really good explanation where it comes from. It is a key question. The major problem (the way I spell things out) is that if we have achieved peak production, we wouldn't know it until we were on the back side of the curve - some can't accept that scenario. My challenge to the question is what can be done and by whom. I don't lose as much sleep over it. The liberating thing about being a person with a firm belief in the free market cooperation among the billions of inhabitants is that the water of economics naturally seeking it's own level is the best means to finding the answer. My concern is when the planners, using very little and incomplete information, are pushing resources in one direction or another. I hate to get all Ayn Rand-y for risk of being called a wackadoo but when the "experts" have claimed armageddon repeatedly over the last 6 decades and been proven wrong I can't help but think of the quote When these forecasts are consistently unreliable it is worth a few minutes to examine the contradictions. I'm starting to feel that old feeling of taking the topic off-track but I think it pokes at the core of what an drive a panic in a market and it is a discussion worth having. I'm not claiming that I know more than others. I'm admitting what I don't know and I wish a lot more people would do the same instead of claiming they have the answers.
I don't think the topic has gone off track. The original post turned out to be fairly nonsense, so I drifted it a bit to include oil production in the hopes of generating some interesting discussion. I see that my plan worked. You may be a wackadoo, but you at least provide an opinion that is more informed than most.
I've just had a look at some statistics, USA and UK total oil demand have been fairly flat since the 80's around 25 barrels of oil per person per year in the US and 11 in the UK. Around '06-07 the demand started to fall then the recession hit and the levels fell to record lows, 22 and 9 bbls pp. The economists here don't see that recovering this decade with the US looking about 21-22 bbls pp and the UK between 9 and 10. Its pretty clear developed markets have already started to switch away from oil to alternatives and this is likely to continue, but its pretty unlikely we're going to switch to an oil free economy any time soon. The high oil prices mid decade then the recession causing people to re-evaluate how much oil they need to use, most of this demand won't recover. I'll have a look at China and India tomorrow those are the real elephants.
I find it amazing that an individual in the US uses more than twice the number of barrels an individual in the UK does. I obviously realised it would be more, but the sheer scale of the thing is shocking. You may as well forget about any green agendas as long as the good old USA is still around.
Well, distances are considerably larger in the US, for one. Here you can cycle to the next city. I'd like to see you try that in Nevada.
I'm assuming that figure is derived simply dividing the total oil consumed by the population. Oil is not just used for filling up cars and heating homes - You have to compare things like manufacturing, transportation and medical industries to name just a few. Incorporate those uses and compare the output and you can easily make the difference. Even if it is simply gasoline burned in cars, as Nexxo points out, Americans drive a lot more than other countries for various reasons, geography being a major one. The amount of diesel used in trucking in the US in just one day would boggle your mind.
