Oil Having Technical Problems
The Oil Drum has an illuminating post that discusses a number of reasons oil prices are high and why they may remain high for a few years. It doesn't look like gasoline prices are going down anytime soon—except maybe at election time. The fundamental issue at the moment may boil down to the fact that current technology is having trouble keeping up with demand, possibly, I suspect, due to poor planning over the last five years.
But the fundamental problem is that merely to replace what has been lost in the previous year due to expected oil depletion, oil companies now have to dig an increasing number of wells just to keep pace. This has been going on for decades but there's been a sharp increase in the need for new wells since the production per well is dropping and there aren't enough drilling rigs to go around at the moment. And over the last five years demand for oil has exploded because of the booming economies of India and China and the general neglect of alternative energy.
Make sense? No? Okay, just read the article.
But the fundamental problem is that merely to replace what has been lost in the previous year due to expected oil depletion, oil companies now have to dig an increasing number of wells just to keep pace. This has been going on for decades but there's been a sharp increase in the need for new wells since the production per well is dropping and there aren't enough drilling rigs to go around at the moment. And over the last five years demand for oil has exploded because of the booming economies of India and China and the general neglect of alternative energy.
Make sense? No? Okay, just read the article.
posted by Poechewe at 11:43 PM
1 Comments:
The demand for oil in China and India will continue to increase in the next 5 years. Yes, India is improving in using oil more efficiently but the good thing is that both China and India are investing a lot for alternative energy sources like wind energy. For exampple, India is the
fourth largest power in wind energy and among the Asian countries
India is the first. China is catching up too.
China at present is the second largest consumer of fossil fuel and the largest oil importer
after USA. So, India and China should join hands.
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