Mark Peters...the issues facing us:
climate change, biofuels, gasoline vs diesel, profit, imports, security, environment, sustainability, energy...
Most people would prefer a straight gasoline tax...but the politicians may not do that. Waxman and other politicians say that 50% of the money from cap and trade will go to the industries that they feel should get it...the government is going to protect the automotive industry...because it now owns it.
Oil prices...absolute low was reached in 12/1998 of $9.16 a barrel... ten years later, oil was over $100 a barrel...capacity pressure started to rise...7/2008 it hit $145/bbl. Much of this rise was due to the drop in the value of the dollar. When the dollar started to rise, the price of crude started to fall. The high price of crude was destroying demand for gasoline...but other countries could buy gas with cheaper dollars...and now a lot of projects have been delayed...put on slow construction schedules.
Factors shaping energy expansion for the next decade: climate change, economic nationalism, world population growth, china and india, energy security, overcapacity, biofuels, changes in crude specifications...
There will be flat consumption of gasoline in the US for the next couple of years, but global consumption will continue to grow, especially in China and India... access to new oil is mainly controlled by NOCs...state owned oil companies like Petrobras and Petroven and Pemex...
all of the same pressures we've talked about are pressing on the refining industry. How do we do sustainability? How do we do biofuels?
The European market is becoming completely dependent on Russia for energy. That's what was behind the meek and mild response to Putin's invasion of Georgia. Russia wants its recognition as a superpower back.
Diesel is taking over...the US is now the largest market for gasoline, but that will change as diesel with no sulfur becomes the fuel of choice in the US as well.
Peters talked about biofuel demand, and the limitations of corn-based biofuels...
Domestic crude oil production has declined consistently in the US since 1987. But the demand for natural gas continues to grow, and development continues to grow. But the lack of investment for refining, processing, etc. will hurt the expansion of the oil companies.
