HURT no more for NOW !!!

It have been 3 months since the last posting and oil have peak at USD147 per barrel and now hovering around USD40 per barrel .
What happen to the prediction that it could fly to USD200 , who knows ?
Today I got to take out the main picture of " Yep's It's gonna hurt " for now until the time comes by again .
Many prediction have been made on oil with most of the consumption of world oil being as per chart below :

Part of the prediction in the chart is true but due to US recession occuring now demand for oil have drop thus bringing down the price of oil .

The low oil price is not good in a sense that companies will curtail the spending on R & D to find source of renewable energy therefore slowing down the efforts of reducing the effect of Global Warming .

I remember being to a few companies which are heavy user of diesel fuel for heating purposes and gather that when Nymex oil future were above USD100 per barrel all are gearing up to change to biomass due to its lower price and insignificant fluctuation in prices . I would guess as of now none is intending to do so as price of diesel have drop back to RM1.50 per liter for industrial usage .

When will this industrialist change their mind set as oil will not continue to be low and continous burning of fossil fuel is not helping the humane cause of reducing global warming .

In short , Malaysians are not only short sighted but reluctant to move out of their comfort zone as compared to Europeans which have been changing to wood pellet heating instead of gas for the last 10 years or so .

The encouraging change over to biomass heating in house hold in Europe are due to a few factor list as below :

1 ) high government tax on fossil fuel , noticeably Europe Gas Price is over double the Rest of The World, click Link : " Gas Prices Around The World " on the sidebar

2 ) availability of convenient automated heating stove and proper fuel in wood pellet

3 ) the caring way of Europeans which are moving to complying to KYOTO PROTOCOL even though price of wood pellet are just a fraction cheaper than Heating Fuel

None of the above factor exist in Malaysia ( or even outside Europe ) thus making it difficult to convince consumer to change over to biomass for heat and power .

Malaysia Government are at least now holding the price of Industrial Diesel at RM1.50 per liter to encourage industrialist to find ways to reduce fossil fuel consumption although Nymex oil at USD40 per barrel would translate to RM1.10 per liter . These is an encouraging effort by the Government which should be applauded .

The government should do more by using the tax collected on the diesel by giving grant to companies which change from fossil fuel to biomass . These is widely practice in Europe and even Japan to encourage usage of biomass .

Here is a link to Peak Oil cartoon .

http://www.youtube.com/watch?v=jriYKmMN8_I

Don't worry it did not happen as yet .

CHEAP OIL

OIL price per barrel have fall to USD50 per barrel now which work out to around RM1.40 per liter for industrial diesel user . These is only a fraction of the peak price of around RM4.00 per liter in June 2008 .

Today we will talk about oil .

I append a few chart on oil .

Worldwide oil consumption have been stabilising at 80 million barrel per day for the last 5 years and yet there is no more significant new oil reserves found in the last 2 decades .

Although currently the price of oil have drop significantly due to recession in the USA , China and India are continuing with annual GDP growth of over 8% . Imagine this 2 country compounding growth of cars alone will consume all the supply available in a few years time .

In fact now , China monthly vehicles sales nearly top 1 million unit per month .

Therefore " PEAK OIL THEORY " are very real in time to come .

Energy & Peak Oil

ENERGY AND PEAK OIL

The last few decades of mankind progress depended on oil and gas .

Over 80 % of the world energy needs are generated from oil and gas which is categorised under fossil fuel which is non renewable . Fossil fuel which takes 150 million years to be generated will be consumed in our life time and future energy needs will come from renewable sources such as solar , wind , hydro and biomass .

Many journals on energy are convinced that current oil production at around 80 million barrels per day are peaking and the spike of oil to USD147 per barrel are due to simple mathematics where demand exceed supply . Although currently oil have turn bearish to USD80 per barrel it will peak again in the future as oil are a finite resources .

A lot of hype on peak oil subject when oil shoot over USD100 and many documentaries have been made on the matter . Some even predicted it will go to USD500 per barrel !!! . It might , in the future go to this price especially when China and India have GDP growth of over 8% per annum .

High oil prices will encourage government and business sector to find ways to reduce fossil fuel consumption and spend on R & D to find alternatives . The growth of oil consumption to these level are due to low oil prices during the 1970s to 1990s where it hover below USD50 per barrel . Thus the low oil price have cause other problem such as excessive carbon dioxide emission which bring to global warming .

Earlier last month the north pole are accessible by ship for the first time due to melting ice .

High oil prices in Europe ( due to taxes by govenrment ) have created more advance technology and more changes to usage of renewable energy . Currently a high percentage of winter heating in Europe home is by biomass such as wood pellet or wood chip . A power plant in Holland even import Palm Kernel Shell from Malaysia for the combustion in their power generation plant .

In Malaysia where there is abundance of biomass but due to lack of Research and Development, biomass is only being used by certain industries which have biomass at their door step . Most other industries are using diesel or gas for their thermal needs as it is more convenient to do so .

There will come a time when oil peak again , many industries which are caught napping will file for bankcruptcies especially if their portion of energy usage are high .

And if you or your company are a high user of fossil fuel please try to change to renewable energy as global warming are real and it will affect us and our children in the future .

The famous quote :

We do not inherit the Earth from our Ancestors, we borrow it from our Children