Posted on 07/09/2012 6:01:54 AM PDT by thackney
Oil unlocked from shale formations is set to create a supply glut that could push down crude prices, according to a new study.
Global production capacity at oilfields will increase by 17.6 million barrels per day (bpd) over the next eight years thanks in part to shale, the most significant increase in any decade since the 1980s, according to Leonardo Maugeri, a research fellow at Harvard Kennedy School's Belfer Center for Science and International Affairs.
"Contrary to what most people believe, oil supply capacity is growing worldwide at such an unprecedented level that it might outpace consumption," wrote Mr Maugeri, who is also a former senior vice president for corporate strategy and planning at Italy's Eni. "This could lead to a glut of overproduction and a steep dip in oil prices."
The United States and Iraq are forecast to lead the production increase through 2020, with Saudi Arabia, Russia and China contributing more modest additions. Pumping levels are forecast to decline in Iran, Mexico and the United Kingdom.
US producers of shale oil need crude to be priced only above US$50 to $65 a barrel for their operations to remain profitable.
The development of shale oil has already made North Dakota, home of the Bakken formation, a bigger oil producer than the Opec member Ecuador. Mr Maugeri writes that North Dakota and its neighbour Montana could become the equivalent of a large Gulf producing country within the US.
12,000 miles per year is well below average. Try 15,000 to 20,000 and the payback period improves considerably. This is for private individual use also. High annual mileage fleets with gasoline engines should be incented to convert. Use this windfall, support it. Benefit. We need all the help we can get and this is a literal godsend.
Hell, you could get a used CNG F150 for that. (cngvehicles.net)
Most places have NG pipelines for heating, including gas stations. It's only a matter of time before they buy their own commercial compressors and start filling vehicles.
Right now, the home setup looks like the way to go.
That is a valuable distinction.
Tell me what that means in execution. Are refineries "required by law" to purchase domestic oil "if available" even if cheaper imported is available?
Oil from every source is not equally available at all facilities. Crude oil in general is fungible, but as we have seen with the Keystone XL pipeline, transportation can be significantly limited in places.
15~20k is farther above the 13,500 national average than I am below it.
verage Annual Miles per Driver by Age Group
http://www.fhwa.dot.gov/ohim/onh00/bar8.htm
nd the payback period improves considerably.
But my 14 mpg is a greater ratio below the average than my mileage. If you use national averages for both values, the payback time gets worse, not better.
High annual mileage fleets with gasoline engines should be incented to convert.
Many fleet service vehicles like garbage trucks, UPS, etc are already changing to CNG or LNG. We don't need to spend taxpayer money to give them reasons to save their own money in fuel.
Maybe a ten year old CNG pickup. Pretty slim choices at $10k.
Why, doesn't it work anymore? A pickup is a pickup.
A ten year old CNG pickup blows the doors off a brand new $3.50 gas guzzler.
I never understood why people buy new cars anyway, just to see them radically depreciate the second they drive them off the lot.
That is the grey area......how rapidly will CNG be adopted.
It is looking very promising here in the Marcellus/Utica as many cities have committed to slowly convert their bus/trash/snow vehicles to CNG. Many local delivery groups have done the same for their trucks.
But, you are correct. Time will tell.
I tend to buy new vehicles and maintain them until they have almost no resale value. I'm not interested in buying someone else's worn out problems. I buy very basic vehicles. My full size truck in 2008 cost $15k. Dollars per mile is my criteria on long term use.
New F150 are getting ~20 mpg. Updating my past calculation to 15,000 miles per year and 20 mpg only stretches the payback out farther. Getting close to seven years without buying a home refueling system.
I tend to buy new vehicles and maintain them until they have almost no resale value. I'm not interested in buying someone else's worn out problems. I buy very basic vehicles. My full size truck in 2008 cost $15k. Dollars per mile is my criteria on long term use.
New F150 are getting ~20 mpg. Updating my past calculation to 15,000 miles per year and 20 mpg only stretches the payback out farther. Getting close to seven years without buying a home refueling system.
I refuse to pay a nickel to the UAW thieves.
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