Current oil price / 'climate change' politics.

So are you guys in the States seeing prices at the fuel pumps dropping, like we are in the UK?

... maybe you've not noticed!!

Anyhow, the issue I see with the price of crude dropping is that it seems to be a failure of policy not to maintain some mechanism to give advantage to low carbon technologies, for example by increasing tax revenues to return a stable fuel price, and using the difference to support new tech.

You'd think that if anyone in politics was really backing the IPCC's calls that the threat to EV takeup from dropping fuel costs would figure in there, somewhere, but apparently not.

Seems not implausible to me that dropping crude oil prices has been orchestrated as a slap to Russia for its recent perceived 'transgressions', as they rely heavily on stiff crude prices. OPEC is trying to cut production to increase the price of crude, but they don't seem to have quite the same levers they used to have. It's just a thought, but if it were true then it'd be pretty damning that tit-for-tat political toying with Russia's economic interests is seen as more important to some Governments than cutting reliance on fossil fuels.

What do you guys think? The suggestion is the decline in crude prices is going to go on a while. Bad news for EVs? Bad news for sound energy policies?

Yes, gas prices have gone down here. I saw $2.96/gallon (78¢/liter) here two days ago and $2.58/gallon has been reported in other states.

Sound energy policy is politically impossible here. The Senate Environment and Public Works committee is about to be chaired by a notorious anti-science activist and climate change denier (author of a book: The Greatest Hoax: How the Global Warming Conspiracy Threatens Your Future), Sen. James Inhofe of Oklahoma (a major oil producing state). He once compared the USA Environmental Protection Agency (EPA) — established under President Nixon — to the "Gestapo".

So, "bad news for EVs?" Yes, even conventional hybrid sales have dropped significantly recently.

"Bad news for sound energy policies?" Sound energy policies have been politically impossible for some years in this country and it figures to get worse. Don't look to the USA to lead on energy or the environment. The fossil fuels industries own Congress and the level of ignorance about science in this country is a disgrace. But, as a scientist (retired), I am biased...

For a couple of views of the oil price slide, see:

http://www.resilience.org/stories/2014-11-06/oil-price-slide-no-good-way-" onclick="window.open(this.href);return false;

http://www.resilience.org/stories/2014-11-07/the-collapse-of-oil-prices-and-energy-security-in-europe" onclick="window.open(this.href);return false;

While it might appear good for consumers in the short run (climate problems aside), the longer term doesn't look good. Food for thought.

Yes, gas prices in the US have definitely been falling. The media's been making a big deal about gas prices falling below $3/gallon and, as a result, truck and SUV sales are up. :roll:

The financial news media here (e.g. CNBC, and Nightly Business Report (also owned by CNBC now)) has been basically portraying the prices cuts as being a means of trying to squeeze North American oil producers (e.g. North Dakota Bakken shale, fracking, etc.) out of business since they have much higher oil production costs than say the Saudis. IIRC, Saudi Arabia seems to be the one behind the cuts. They can withstand it but the many of the NA ones can't.

I watch Nightly Business Report on TV, but here's an example of a story they put up online on this: http://nbr.com/2014/11/06/opec-cuts-oil-price-forecasts-as-price-war-bites/" onclick="window.open(this.href);return false;.

http://nbr.com/2014/10/13/transcript-monday-october-13-2014/" onclick="window.open(this.href);return false; also claims

But the chatter out of conversations this weekend, after Venezuela
called for an emergency meeting indicates that the cartel isn`t making any
rash decisions. Middle Eastern OPEC members have a higher cost to produce,
many in the triple digits.

And with the price below $90 a barrel some are feeling the pinch. But
according to reports Saudi Arabia, one of OPEC`s most outspoken members, is
aggressively courting new customers in Europe is a comfortable with the
drop in prices.

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Yep, dgpcolorado is basically right about energy policy being impossible here. It seems there's only action if there's a crisis. And, often once the crisis is over, Americans go back to buying trucks, SUVs, guzzlers, etc., believing in the US has plenty of oil (vs. the entire world's supply and those areas which have the most), not seeing or even knowing about the bigger picture, etc. Driving slower on the highways would help including lowering speed limits again, but that's not going to happen. (Even I'd admit to not being happy if this happened.)

Even when gas was over $4/gal, if you went to an In-N-Out Burger (not known for speedy service) and looked at the drive thru on a busy night, there'd be over a dozen vehicles in line, almost none of them hybrids, EVs/PHEVs, or anything w/auto-start/stop systems (not common in the US). So, they'd sit there idling away uselessly for probably 20-30 minutes. I guess gas is too cheap for them and/or they are just clueless about the fuel they're wasting by getting 0 mpg that whole time.

donald said:

Seems not implausible to me that dropping crude oil prices has been orchestrated as a slap to Russia for its recent perceived 'transgressions', as they rely heavily on stiff crude prices. OPEC is trying to cut production to increase the price of crude, but they don't seem to have quite the same levers they used to have.

Click to expand...

From what I've read, it's more of a price war in response to the short-term glut of frakked oil being produced in the U.S. Not sure about OPEC as a whole, but iirc, the Saudis are cutting prices (boosting production) in an effort to hurt the frakkers by dropping the price of crude below the frakkers' profit line. It's a temporary game. Although Saudi oil costs much less to produce, their need for revenue means they can't maintain a cutthroat position indefinitely.

In the meantime you can be sure that the new "drill baby drill" Congress will begin dismantling energy reform, such as it is, including EV incentives, alternative energy funding, fuel economy standards, EPA funding and pollution standards. And of course they won't sleep at night until the Keystone pipeline is in place to help Canada get its tar sands oil to the gulf coast.

Nubo said:

<snip>
In the meantime you can be sure that the new "drill baby drill" Congress will begin dismantling energy reform, such as it is, including EV incentives, alternative energy funding, fuel economy standards, EPA funding and pollution standards. And of course they won't sleep at night until the Keystone pipeline is in place to help Canada get its tar sands oil to the gulf coast.

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I have no doubt they'll pass some bills to do all that, but since they lack a veto-proof majority in either house virtually none of it will pass, so for better or worse gridlock will continue for another two years. Of course, they'll try to bundle some of those in 'must pass' legislation, so they might get one or two by.

^^^
Yep. The GOP majority in both the House and Senate doesn't help things. You're probably right on the gridlock for the next 2 years.

Everyone needs to stay calm. Oil prices will go back up.

LTLFTcomposite said:

Everyone needs to stay calm. Oil prices will go back up.

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Indeed. In North America, much of the new drilling efforts shut down at the beginning of the year, anticipating the current price regime. And a lot of smaller, shaky oil companies might go belly up.

In addition, in the US the lack of water is having a negative influence on fracking. That and the expanding efforts to outlaw fracking in a number of cities and counties should reduce the rate of expansion of fracking even with this new mess of a Congress...

Obama has said he would only approve the Keystone Pipeline if analysis showed that the pipeline project would not contribute to total global CO2 emissions. The thinking seemed to be that if oil sand production would increase with or without this pipeline, he would approve it. 6 months ago Canada was saying they could build their own pipeline to their east coast refineries, or ship it to a new terminal on their west coast, so not building Keystone would not stop their planned tar sands production increase.

Now, with the price of oil plummeting, there is a good argument that the price savings of Keystone is needed to justify further tar sands development; i.e. Keystone no longer meets his criteria.

Part of the reason TransCanada is ostensibly hoping to complete the KXL is because it will make its tarsands oil cheaper to transport and, thus, cheaper for the consumer to purchase. Consistently high oil prices made the KXL’s completion irrelevant to consumers because the price of shipping it by truck or rail was affordable for the oil industry. However, now that oil prices have dropped, shipping oil by truck or rail is burning a hole in TransCanada’s pocket. It now has greater incentive to finish the KXL, which has been delayed for years. According to the State Department’s market analysis of the KXL, if oil prices were to drop to $75 per barrel, “higher transportation costs could have a substantial impact on oil sands production levels — possibly in excess of the capacity of the proposed Project— because many in situ projects are estimated to break even around these levels. Prices below this range would challenge the supply costs of many projects, regardless of pipeline constraints, but higher transport costs could further curtail production.” - See more at: http://www.planetexperts.com/oil-continues-decline-will-obama-approve-keystone-xl/#sthash.5PqGn5BF.dpuf" onclick="window.open(this.href);return false;

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http://www.google.com/url?sa=t&rct=...zCxjoOYmG_6eKFZmClwDDqQ&bvm=bv.80642063,d.cGU