Using Petroleum ONE BARREL crude oil yields ALL OF

Quality of crude is declining Refineries must be reconfigured for this, expense makes them inflexible Requires more energy in Impacts … ERoEI

“Boutique gasoline” in summer for local smog control & T Reid Vapor Pressure ReFormulated Gasoline Cleaner Burning Gasoline Price rises spread to WA, OR, BC and even Australia

Oil industry (“oil patch”) Upstream Upstream Exploration & extraction Exploration & extraction Extraction is mostly controlled by NOCs Extraction is mostly controlled by NOCs All of OPEC, 1/3 of rest All of OPEC, 1/3 of rest Downstream/mid-stream Downstream/mid-stream Refining, distribution, retailing Refining, distribution, retailing Transport, ship & pipelines Transport, ship & pipelines Many tax subsidies Many tax subsidies Oil depletion allowance Move profits/losses from down/mid to up Intangible drilling cost allowance Deduct 70% of well cost in 1 st yr, rest over 5 yrs Enhanced oil recovery credit For running stripper wells

What/who sets oil $ ? Depleting supply of cheap-to-market oil Depleting supply of cheap-to-market oil Cost of “last barrel” to large pop in developing country Cost of “last barrel” to large pop in developing country Demand in developed world is intertwined w/ global finance Demand in developed world is intertwined w/ global finance Motivations of NOCs (85%) vs multinationals (15%) Motivations of NOCs (85%) vs multinationals (15%) CERA 2008 barrel price required to sustain flow Likely overstated!

Petrostates Organization of Petroleum Exporting Countries ~40% of world extraction Organization of Petroleum Exporting Countries ~40% of world extraction Libya, Algeria, Venezuela, Ecuador, Nigeria, Angola, Iraq, Iran, Kuwait, Saudi Arabia, Qatar, UAE Libya, Algeria, Venezuela, Ecuador, Nigeria, Angola, Iraq, Iran, Kuwait, Saudi Arabia, Qatar, UAE Cartel to set oil price for max. profit to petro- economies Cartel to set oil price for max. profit to petro- economies “Dutch disease” “Dutch disease” Big revenue flow strengthens currency, makes exports too expensive to compete High wages, expensive real estate “Oil curse” “Oil curse” Highly automated, no need for educated pop no incentive to diversify economy easy control & corruption, suppression

Fake Middle East Oil Reserves