Today's news on oil prices continues to build on the concern for the global economy, concern about the future well being of the United States and concern for a peaceful and well ordered world as massive economic blocs manoeuvre against each other to capture and control what limited resources are available. The LA Times four hours ago quoted one eminent writer on the subject:
"Nothing short of a slowdown in demand is going to reduce the price of oil," said Leeb, author of the 2004 book "The Oil Factor," which predicts a turbulent era in which oil demand far exceeds supply and petroleum prices rise as high as $100 a barrel.
"You're simply at a point," he said, "where demand is outstripping supply."
Not a bad quote, except it doesn't immeditely state its bigger thesis that in the foreseeable future of the next twenty years, that slowdown in demand is not going to occur and oil prices could go much higher. Period.
Let's look more fully at today's news in the same LA Times story:
Oil Prices Rise Despite OPEC Move
By James F. Peltz, Times Staff Writer
OPEC spoke but oil markets shrugged, as the cartel's decision Wednesday to lift its official production levels failed to keep the price of crude from rising again.
...with OPEC already pumping nearly 30 million barrels a day, the increase in its official quota "is just a cosmetic statement," said Stephen Leeb, president of Leeb Capital Management Inc. in New York. "OPEC already is essentially producing at 100% capacity."
After OPEC's meeting, the price of the U.S. benchmark light sweet crude for July delivery rose 57 cents to $55.57 a barrel after trading as high as $56.75 on the New York Mercantile Exchange.
The price is now within $2 of its record Nymex close of $57.27 a barrel, reached April 1.
The indifference to OPEC's fifth production increase in the last year offered little hope that consumers and businesses would see any immediate relief in energy costs, although the high prices haven't dented their growing thirst for oil and refined products such as gasoline and diesel fuel.
Now let me put in juxtaposition to this global story, news published today in the Western Mail. a regional Welsh newspaper. about a development just forty miles from where I write this diary:
UK's largest wind farm opens in Wales Jun 16 2005
Sally Williams, Western Mail
WITHOUT question it is an arresting sight. But without controversy, Cefn Croes wind farm, is not.
It opens officially today with all the fanfare you'd expect from a Welsh Assembly Government which is committed to obtaining 10% of Wales's energy needs from renewable sources by 2010.
And the £50m farm, near Devil's Bridge in Ceredigion, which is officially the largest onshore wind farm in the UK, is said to be set to save 2.3 million tonnes of carbon dioxide over its expected lifetime.
Not only that but its 39 turbines are expected to supply 42,000 homes a year and half the electricity used will remain in Ceredigion.
Friends of the Earth Cymru say it will help to reduce the global warming problem.
But with the distinctive white turbines towering at heights of between 55 to 65 metres, the Campaign for the Protection of Rural Wales has been among those voicing fierce opposition to it.
Why put two of today's news stories into the same diary, one talking about world energy resources as a world-wide issue and the other about a wind power development in a tiny part of the world you will probably never have heard of?
Is it because the smaller of these two stories spells hope for the larger? In your dreams only.
I suggest that we in the liberal progressive movement are in serious danger of writing diary after diary that makes us feel good about renewable energy resources, wind farms and hybrid motor vehicles, and all the other green solutions. Great stuff and part of the long-term solution, but so unreal in meeting present problems that it will marginalise us as a political force.
We need better answers to the clear and simple fact that the US needs oil and it needs it in large quantities. I don't like that fact. I don't like its consequences. I want to live in the real world, however, and be taken seriously in it. Ignore the simple fact that the US must get oil in quantity, concentrate in the margins only on that which affects the periphery of the immediate problem and offer no direct solution and we will be ignored and we will not be part of any solution.
I am not making an argument that we change our values or alter the nature of our concerns. I am making an argument that our policies need to be a damn sight clearer and better spelt out for the immediate future or we will vacate the arena to those who can produce them
I shudder when I remember the 2004 Presidential debates when the energy crisis was discussed. Can you remember the power of Kerry's argument? If you can remember, then you will probably remember it only for its lack of power.
We need something better than shifting today's problems into tomorrow's solutions. We need something better than simply focusing it, for example, into discussion of renewable energy resources and political games-playing over the refusal of the USA to sign the Kyoto agreement.
How come we make a central plank of our policy Kyoto, whilst ignoring the present threats and dangers from the inability to supply our immediate demand for oil.
I support Kyoto, I am appalled by its rejection. Yet you can't build the Democratic energy crisis policy around this fact alone. In any case, recall who was one of the prime influencers behind Kyoto. Evidence from internal Enron memos shows that 'the vocal global warming movements and its 1997 Kyoto Protocol were fruit of a extensive lobbying campaign. A prime mover? Enron (surprise!). The memos disclosed that 'green' groups were courted, funded and even created to spread the gospel that man is killing the planet by burning fossil fuels, a malady Enron offered to mitigate through its natural gas, windmill and solar ventures'. One memo headed 'Making sure there is a treaty' detailed high-level meetings with Clinton administration officials. Oval Office meetings followed soon thereafter [Washington Post, 25 April 2002].
To achieve 20% of electricity supplies from renewables by 2020 would roughly double the retail cost of electricity in the USA [Energy Administration Information statistics]. This in turn could throw the world's largest economy into even deeper recession, causing untold misery for the every other nation throughout the world.
So the Democratic Party needs a fully detailed policy with which to go into 2006 and 2008 that deals with issue as it is now.
Sure I want to see a change in the basis of power production in Europe which is currently around:
Natural gas 37%
Coal 33%
Nuclear 25% (UK 22%, France 3%)
Renewables 3% (mainly biomass)
Oil 1%
Hydro 1% [The Times, 30 August 2002]
I want us make every effort to reduce pollution and energy use, coupled with an increase in energy efficiency. I want much more research needs to be done rapidly into wave & tidal power; geothermal energy; energy from waste management & methane from old coal mines; and especially biomass crops, for they convert as much CO2 as is released in their burning. Energy from Landfill gas is now considered 'one of the most successful technologies' and 'a mature technology', with an installed capacity potential of 850MW. [DTI New Review, May 2002]
But alone, this won't hack the problem for the UK right now and similar action won't provide a a solution to the USA. There is no supply side solution.
So what and where is the substantive policy owned by the Democratic Party which both meets the economic issues which face us and counter the arguments on the Right for handling the crisis of the next ten to twenty years through aggressive military adventures to control the source of supply?
I am looking for practical answers about how industry and the government should alter its manufacturing base and economic and fiscal policies now to meet the reality that has arrived exactly as forewarned, not the artificial warmth provided by cheery chats about the possible oil to be derived from the Canadian sands or the increased efficiency of wave driven turbines.
I need to know how a realistic policy from a realistic political party can be sold as a positive to a nation that will have to take the pain,rather than have it shifted to another country by the grabbing of its resources. I need to know how such a policy can be sold to a nation, the majority of whose people seem oblivious to the fact that such a crisis is here, right now and don't realise the consequences.
Meanwhile, here in the north-west of Wales, I shall pick up the corpses of the Red Kites that fly into the blades of the petty gestures provided by our government that is represented by our wind farms in the absence of a comprehensive solution . I hope their limp, dead bodies are not sacrificed on behalf of an empty piece of political propaganda maintaing that there are solutions to fix the supply side whilst they avoid taking the necessary but unpopular measures on the demand side.
I hope, too, that their corpses are not symbolic of an even greater truth about our Western Civilisation.