How about Oil?

[Runner]

Not sure if this link as been posted. Many are going to pay out the butt this winter for heating oil and nat gas.

http://tonto.eia.doe.gov/oog/info/twip/twip.asp

http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp

[Websman]

Not sure if this link as been posted. Many are going to pay out the butt this winter for heating oil and nat gas.

http://tonto.eia.doe.gov/oog/info/twip/twip.asp

http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp

That's why I live in Florida.

[dmk112]

I still can't believe I'm not in any energy stocks... what a mistake that was.. Anyone think they still have room to run?

[mrmarket]

I still can't believe I'm not in any energy stocks... what a mistake that was.. Anyone think they still have room to run?

Ummm...I've basically bet my whole career on that premise.

[Runner]

Well in my town in Alabama we are running out of gas. Lines are forming at the pumps and many stations are already closed. Wow this is huge!!

[dmk112]

Well in my town in Alabama we are running out of gas. Lines are forming at the pumps and many stations are already closed. Wow this is huge!!

I hope they don't start rationing gas again as they did in the 70's (or 80's was it?). Anyway, its not going to be good for anyone...

[sowersnc]

Anyone out there have any ideas on the cost to manufacture ethanol and soy biodesiel? I was curious at what gas price it becomes a cost effective solution.

[New-born baby]

Anyone out there have any ideas on the cost to manufacture ethanol and soy biodesiel? I was curious at what gas price it becomes a cost effective solution.

The USA had a drought this year. Yields for corn and soybeans are lower.

I don't know, but--I am ignorant, so take what I say with a grain of salt--we need soybeans to feed the cattle and hogs. We need the corn to feed the cattle and hogs. It isn't a good solution. Corn is going to be the next oil, i.e. in short supply.

I think the solution to the oil problem lies in the oil sands of Canada and Wyoming. Canada has 2 Saudi Arabias in it in oil sands alone, and oil sands can produce profitable fuel at $35 per barrel (oil is currently $70+, so it is very profitable right now). Therefore, I think oil sands will be a better investment than biodesiel. Remember, I could be wrong.

[sowersnc]

I wasn't saying it was a good solution. I was just curious at what price point gas needed to be at for it to be profitable. Their is also a matter of the government subsides that go into these programs.

Here in Iowa they are trying to find value added programs for corn and soybeans. These programs fit into that. They are trying to make it more than crap they feed to livestock.

But on to oil sands I have been reading about that too. It would be a nice solution because the existing transportation and delivery system seems like it could be used, unlike some other alternatives. If $35 is correct then I would like to look into this. The only oil sands company I know of is SU. Do you know of any others?

[New-born baby]

I wasn't saying it was a good solution. I was just curious at what price point gas needed to be at for it to be profitable. Their is also a matter of the government subsides that go into these programs.

Here in Iowa they are trying to find value added programs for corn and soybeans. These programs fit into that. They are trying to make it more than crap they feed to livestock.

But on to oil sands I have been reading about that too. It would be a nice solution because the existing transportation and delivery system seems like it could be used, unlike some other alternatives. If $35 is correct then I would like to look into this. The only oil sands company I know of is SU. Do you know of any others?

There's a boat load of them in Canada, and I need to research it. I think that part of my portfolio ought to be in one or more of these companies.

[jiesen]

Ethanol and biodiesel are not cost-effective replacements for oil

Anyone out there have any ideas on the cost to manufacture ethanol and soy biodesiel? I was curious at what gas price it becomes a cost effective solution.

I don't really know, and I don't think anyone else really does either, but from what I've read, it's likely that biodiesel or ethanol will never be a cost-effective solution. The only way people in this business would be likely to make any money at all would be if the government subsidized what they're doing. The problem is that it may take more energy to produce a barrel of ethanol energy than you get by using it. This is still not fully known, as the full-scale economy process hasn't been completely optimized, but consider this simplification- your tractor uses 1 barrel of oil harvest your corn, from which you get 1 barrel of ethanol. Now, consider what happens if the price of oil goes up- so does the cost of your ethanol! But wait, there's more. Not only do you have to fuel the tractor, but you also need to pay the capital cost, including the energy that goes into making the equipment, other materials, etc. Soon, you see that you're actually paying more than a barrel of oil's energy for just one barrel produced- a losing proposition that just gets worse with increasing energy cost.

Someone making ethanol now may be putting in just half the energy they get out, and thinking they're being productive, but when their entire energy cost is considered, they'll likely be doing much worse than they thought, and probably working towards a net energy loss. Think of a company's income statement where the CEO thinks they're doing great because gross profit is going up with ever-increasing sales. It doesn't matter at all if the bottom line NET profit keeps going further into the red. At any rate, the easiest and cheapest way on earth to get energy is to just drill a hole in the ground and pump it out. The only other way that has a shot at being cheaper is nuclear fusion, and that has just a very slim chance of success. And if our cheapest source of energy is lost without a similarly cheap replacement, then we're in a world of hurt. I'm sorry, NBB, but oil sands won't cut it either. While they may be profitable as long as prices are over $35, that's still 10x more than what the Saudis have to pay to get the oil out of their sand. So if you don't mind paying $30/gallon for gas instead of $3 then oil sands will be a fine substitute, but for the 99% of us who don't make over $1M/year, that's going to severely cramp our style.

I just hope that this project is able to get off the ground before spiraling energy costs make it economically impossible to finish:

http://www.iter.org/index.htm

Ok, I admit I'm rambling and taking the ultra-pessimistic view of some of the peak-oil theory floating around out there. And I'm no expert... but I do like to throw the question out there- just what if we're about to run short of this stuff? Not knowing the answer can be pretty damn scary. I believe that the peak oil hype must be overblown to some extent, though, if only because the alternative is just too depressing to consider.