The May 2008 Dallas Fed report, "Crude Awakening" shows how the EIA repeatedly failed to adapt its forecasts to reality. JPods EIA Repeating Forecast Failures of 2008: Solar and wind have adequate Net Energy of over 20:1. Bankruptcies and the loss of $300 billion were a consequence of this decreasing Net Energy. With fracking, the Net Energy is falling off an Energy Cliff at less than 5:1.
The Federal highway monopoly began when oil's Net Energy was 100:1. As the quality of fields diminish, Net Energy - the amount of energy obtained relative to the amount of energy expended to extract it - decreases. Generally, the best and most profitable oil fields are extracted first. It appears that consuming DUCs, longer horizontal drilling, and a 41% decrease in demand during COVID accounts for affordable gasoline from 2020 to the date of this article, April 2023. The Rig Count is not increasing with oil price as it has in the past. This increase is small today, likely because the fracking industry lost $300 billion with significant bankruptcies and policies hostile to the industry. The Rig Count previously increased with increased oil prices. The Rig Count since 2015 indicates future supply shortages. The Rig Count of over 1,500 between 20 provided affordable oil between 20 and a massive number of DUCs (Drilled UnCompleted). The supply of oil in 3-8 years is determined by the Rig Count today. The qualifying point of the Fed's question was "given the current underinvestment in exploration." Link to 10 US Presidents issuing unanswered calls to action to cut oil use by 1/3rd to end foreign oil addiction. President Obama, 2010: "For decades we have known that the days of cheap and easily accessible oil were numbered."
This crisis of unaffordable oil in an oil-powered economy has been unfolding at the slow pace of oil field depletion for decades.Īdmiral Rickover, 1957 Energy Slave speech: "For it is an unpleasant fact that, according to our best estimates, total fossil fuel reserves recoverable at not over twice today's unit cost are likely to run out at some time between the years 20." Geological Pace of the Approaching Crisis: natural gas to come to an end as liquefied natural gas exports to Europe expand?Īnswer: 69% agreed that it would happen by 2025.Ĭomment: "As to the question regarding natural gas, the age of inexpensive gas has already ended." Question: Do you expect the age of inexpensive U.S. Oil prices in the late 2020s will be something to behold." When it does, this feels like watching the steamroller scene in Austin Powers. production will be down 20 to 30 percent quickly. Shale will likely tip over in five years, and U.S. Question: Do you expect a significant tightening of the oil market by the end of 2024, given the current underinvestment in exploration?Ĭomment: "Shale core exhaustion and inventory concerns are mainstream and well-documented issues. The cost of the 2008 Great Recession was documented by the Dallas Fed:Ģ013, Jul, Dallas Fed: Bottom-line Cost of 2007-09 Financial Crisis Estimated at $6 Trillion to $14 Trillion.Ģ013, Sep, Dallas Fed: Assessing the Costs and Consequences of the 2007-09 Financial Crisis and Its Aftermath. The solution identified to avoid future hardships experienced during the 1973 Oil Embargo by Congressional Study PB-244854, "Automated Guideway Transit". The Dallas Fed's findings that policy makers and business leaders who can use to act in advance to mitigate a replay of the 2008 Great Recession. The purpose of this article is to provide background data for: The 2008 pattern could repeat by 2024, based on the Dallas Fed's September 2022 survey of 153 oil companies.
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