"CRUDE" oil, an absolute must see program !!!

Thanks Steven, a well presented and intelligent response

The Great Oil Hoax

...this came across my desk just recently in the form of one of those finacial newsletters seeking subscriptions. I edited and abreviated it slightly, but for the most part this fellow got it right...BE PREPARED.

THE GREAT OIL HOAX​

Discover the biggest lie of the last 30 years...
…and what George Bush was told behind closed doors​

Those Saudi Arabians, you've gotta love 'em. First, 15 out of 19 hijackers on Sept. 11 were Saudis, but Saudi Arabia had NOTHING to do with it, or so we're told. Besides they love us, don’t they?

Now Saudi Arabia is about to drop another bombshell on us, and this one will make Sept. 11 look like small potatoes. I never thought I'd say anything could make Sept. 11 look like small potatoes. But this does, at least when it comes to the economy. Sept. 11 shut the markets down for a few days. When the next crisis hits, you'll wish the markets would shut down so you wouldn't have to watch the carnage.

What Bush learned behind closed doors.​

If some well-informed experts are right, Saudi Arabia's oil reserves are a fraction of what they've been telling us. Why does it matter? Because everyone has believed for decades that Saudi Arabia's oil supply is virtually unlimited. That's what the Saudis have said over and over again for more than 30 years.

If an oil shortage threatens to cause a recession or a market crash, we can count on the Saudis to come through…so people think.?? But in a private briefing, one of America's top oil experts told President George Bush exactly what I'm telling you. (Brian’s note: Doesn’t this really explain our attempt to gain some control over the world’s second largest know reserves…IRAQ ??)

In fact, this same man was a consultant to the secretive task force that drew up Vice President Dick Cheney's energy plan in 2001.(Brian’s note: Another reason Cheney fought SO HARD to keep this meeting a SECRET!!)

In other words, the guy is a heavy hitter who knows the energy business. He warned Bush that the Saudis don't have anything near the oil reserves they claim. They already pump less oil than most "experts" think, and here's the real kicker...
Saudi oil production is about to drop sharply. And it will keep going down for good.
Other experts have analyzed the numbers and come to the same conclusions. If the charges are true — and I believe they are — we could be facing...

Oil at $150 per barrel and gasoline at $6 a gallon or more​

The oil is running out. It's as simple as that. But that's not what you hear from so-called experts. If you ask government officials, our intelligence agencies and even powerful Wall Street financiers, they tell you the opposite. They say the Saudis could quickly double their oil production from the current level if they wanted to. And given a few years, they think the Saudis could produce four times as much oil as they do now. This is like the Iraqi WMDs all over again. The intelligence agencies and the conventional "experts" are dead wrong. The oil isn't there.

Saudi Secrets and Funny Math ​

The cupboard is bare and nobody knows it. Americans used to run Aramco, the huge oil company that manages the Saudi fields. But in 1979, the Saudis booted us out and took over.

And then a funny thing happened… The Saudis started keeping everything a secret. No one knows for sure how much oil they've got in the ground, or how much they produce each year, or how much they could produce if they wanted to push it to the max. It's all secret.

Experts try to figure out how much oil the Saudis sell by monitoring tanker traffic in and out of the world's ports. That's how little we know for sure. But wait, it gets worse!

After the Saudis took over, an even funnier thing happened...Their figures for proven reserves kept going up and up and up — even though they didn't find any major new oil fields! In 1979, the Saudis adjusted proven reserves upward by 50 billion barrels. Then eight years after that, their proven reserves magically grew by another 100 billion barrels. Their estimated reserves increased by 150% in nine years — to a total of 260 billion barrels. And they didn't find a single major new oil field!

And here's the funniest thing of all...For the last 18 years, they've claimed they own 260 billion barrels of proven oil in the ground. The figure never goes down, even though they pumped out 46 billion barrels during that period. Let me see...260 minus 46 equals 260. Saudi math!

Based on these bogus figures, the Saudis claim they can produce as much oil as the world wants for the next 50 years. As recently as 2004, they claimed their reserve estimates are
actually conservative That's why most of the world's governments and intelligence services believe the Saudis could pump 20 million barrels of oil a day if they wanted to. Trouble is, we've got no proof except their say-so.

If it were true, we wouldn't have a thing to worry about. But it's not. Before Aramco's American owners were shown the door in 1979, they told Congress that Saudi Arabia had proven reserves of 110 billion barrels. There have been no major new discoveries, so 110 billion barrels was probably just about right. And since then, about half of that has been used up.

So why do the Saudis insist everything is just fine and they have 260 billion barrels of reserves? One reason is they wanted to discourage non-OPEC nations from looking for more oil or switching to alternatives. It was a devious plan, and it worked perfectly. But that wasn't the only reason the Saudis lied about their reserves. They did it because everyone does it! Everyone in OPEC, that is.

The Biggest Lie of All: OPEC's Imaginary Oil​

In the 1980s, OPEC's claim of total reserves magically leaped from 353 to 643 billion barrels without a single major discovery. Industry experts call it the quota war. You see, OPEC had to limit how much oil each member could sell, because prices were too low.

The quotas were based on...each member's oil reserves! That's right: The amount of oil OPEC would let a member pump depended on how much that member had in the ground. So it paid for OPEC members to claim the biggest reserves they could. And that's what they did.

The Saudis alone jacked up their estimate by about 100 billion. Kuwait added 50% to its reserves in one year, 1985. Venezuela doubled its reserves in 1987. Iraq and Iran doubled their estimates, too. What's more, OPEC members did like the Saudis and kept their reserve estimates the same year after year, as if no oil were being pumped out and sold.
Everyone claimed to have a bottomless well.

Now, if you're like me, you prefer to base your financial decisions on the real world, not on a fantasy. Let's look at how much oil there really is...
In the 1970s, when Western managers were still in charge, they believed for a time that Saudi output could reach 20 million barrels a day. But by the time the Americans lost control in 1979, they figured the peak would be 12 million.

They also predicted that peak production would last only 15–20 years. Lets see 1979 plus 20 is 1999. We're past the peak, if these men were right. But we already know they were too optimistic. The truth is that Saudi production never got to 12 million.

"In all probability, output peaked in 1981 at an unsustainable level of about10.5 million barrels per day," according to Matthew R. Simmons, a leading oil industry authority”.

And yet the lies go on...In 2004, Saudi officials claimed they boosted production to 9.5 million barrels per day and maintained that level for five months. It's almost sure they were lying. The International Energy Agency is the group that keeps an eye on these things for the developed, oil-importing countries. The IEA could find no sign the Saudis were selling more oil. As far as anyone can tell, they pump only around 5 million barrels a day, and that's all they've pumped for years.

It's déjà vu all over again. In spite of being lied to at least once, the IEA, the U.S. Department of Energy and other forecasters believe the Saudi claims. ALL their projections of our energy future ALWAYS assume the Saudis could produce 15–20 million barrels a day. The lies have worked. Not only do Western politicians believe them, but so do many oil industry experts and investors with huge amounts of money at stake. They've been had. We’ve all been had.

We went through three recessions from 1973–1983. Care for a repeat? Our whole economy is at risk. Your investments are at risk. Your retirement plans are at risk.

America has been so prosperous the last couple of decades, a lot of people forget what the energy crisis of the '70s was like. Let me remind you: The price of a barrel of oil shot up 400%. Long lines formed at gas stations practically overnight. Folks had to pay four times as much for a gallon of gas, and there came a week when one out of every five gas stations in the United States had no gas to sell at any price.

The U.S. had three major recessions within 10 years after the first oil crisis in 1973. And those recessions were deep, with double-digit unemployment, double-digit interest rates and double-digit inflation:
Think 10–12% unemployment.
Think 15–18% mortgage rates.
Got the picture? That was the '70s. Not fun. My take is that a similar crisis will rock the nation before we solve our problem with clean coal, liquefied natural gas, oil from tar sands, high-mileage cars and safe nuclear plants.

How oil could go beyond $150 in 24 hours​

If you want to bury your head in the sand and pretend Saudi Arabia has plenty of oil, be my guest. But XXX Investments is for investors who want to face reality and be prepared. Every shred of evidence points to no Saudi buffer for world oil markets. And that's a real problem because oil consumption soared from 52 million barrels a day to 82 million in the last 19 years, and it's expected to grow to 120 million in the next 20...

If the oil can be found, very doubtful, high-priced oil is here to stay

There are three ways oil could race past $150 a barrel: It may get there gradually...or on a faster pace of a year or two...or overnight, literally within 24 hours. Pick any one of the three. No matter how you look at it, it's a sure thing the days of cheap oil are over. We're never going to see $30 oil again, and we may never even see $50 oil. Soon oil in the $100s may very well return to stay.

"You never really run out of oil," says a Houston energy consultant named Henry Groppe. But many years ago we ran out of $2 a barrel oil, then we ran out of $25 oil, and now we're running out of $40 oil…"(and for now we’ve settled at $60)

That's for sure. And that means you need to readjust your holdings....The disaster could hit very fast. There could be a deep, sharp reduction in Saudi oil production literally any day. It's guesswork, but energy expert Matthew Simmons says,
"It will take energy forecasters and policymakers by total surprise. Not a single serious energy plan devised in the past three decades has envisioned such a scenario."

He's told interviewers that Saudi output could drop 30–40% from the already low level of just 5 million barrels. Simmons doesn't claim to know for sure, but I believe he's right.

In the big oil crisis of 1973, oil went to $100 in current dollars. Back then, the problem was just political. Angered by U.S. support for Israel, the Arab oil producers cut our supply. After things calmed down, there was plenty of oil.

This time the problem is real and there's no quick fix. There's a sword hanging over our heads, and most people don't even know. Just consider this...

Three quick disasters could send oil over $150 in 24 hours​

1) Monster Storms
2) War & Revolution at the chokepoints
3) Terrorism

…and meantime the Saudi reservoir quantity is this fictional buffer

Never say never

"Canada's greatest buried energy treasure,"...but at what cost to extract in both monies, pollution, and raping the landscape

Also note this chart's percentages are based on US imports, not world supply

Crude Cassandra

Cassandra (a person whose warnings of misfortune are disregarded)

...excerpts from an article I read recently
Simmons’ message is always some variation on the global implications of Peak Oil—that point after which global crude supplies wane, prices soar and shortages spur geopolitical strife. The Ukraine-Russia gas tiff is a first taste of the transnational energy disputes to come

He insists we’ve already passed Peak Oil—but the world won’t realize it until economic recovery stimulates oil thirst anew. When that comes, gird for shortages and $500 a barrel. “There’s no logical reason for the price to be this low. If it doesn’t reverse itself soon, it will destroy the industry’ he says. If Simmons ruled the world, he’d order an oil price floor of at least $150 a barrel to stimulate exploration and to combat rust, which he says is the biggest threat to the oil supply. He figures it could cost $100 trillion to replace aged pipelines, rigs and platforms. That’s quite a sum—70 years of oil industry revenues, at present rates.

According to the U.S. Department of Energy and the International Energy Agency, non-OPEC output appears to have peaked in 2006 at just above 51 million barrels per day (bpd), and fell below 50 million in 2008. World output inched up to 86 million bpd a year ago only by the dint of spigot-opening by OPEC
“We’ve avoided shortages only by squeezing every molecule of natural gas liquids, ethanol and biofuels, by increasing refinery gains a bit, by drawing down stocks:’ says Simmons. “That’s how we balanced a market we couldn’t supply.” OPEC’S numbers include natural gas liquids (like propane and butane), up from 4.5 million bpd to 5 million in two years. US. figures also include ethanol, which now contributes 600,000 bpd. Back out such substitutes and crude oil volumes have been flat at around 75 million bpd for four years. Simmons prophesies that in ten years oil will be down to 60 million bpd and natural gas production will be off 20%. He thinks the Saudis are lying about their ability to crank up output and that natural decline rates from existing fields will overwhelm new fields from Iraq, Venezuela or Nigeria.

Simmons contends that traders were forced to liquidate oil contracts as credit dried up, causing prices to fall. As credit markets recover, he says, traders will bid up oil once again

Simmons’ critics insist he doesn’t appreciate the power of new technology to tap previously unreachable deposits trapped in shale or under ultradeep water. “Technology is fabulous, but it does exactly the opposite of what people thought it was going to do—it accelerates decline rates:’ he says. “The simple analogy is you’re having a Slurpee-slugging contest. You have a normal vertical straw and someone comes along with a multilateral straw. You’re not getting more out, just getting it out faster.” This paradox is evident at Cantarell, Mexico’s largest field. For 15 years it produced 1.5 million bpd like clockwork. Then natural decline set in. State oil company Pemex drilled dozens of new wells and built a system to inject nitrogen gas. This boosted output to 2.1 million bpd in 2004. Then the collapse: Cantarell is down to 800,000

Simmons fears overproduction today will bring total collapse tomorrow. A fourth of the world’s oil comes from the 20 biggest fields, 60% from the 800 biggest. In his 2005 book Twilight in the Desert, Simmons asserted that Saudi Arabia’s Ghawar field, the world’s biggest at 5 million bpd, was on the brink of collapse. “The world can’t afford to have Ghawar fail the way Cantarell has”, says Simmons. The Saudi leadership despises him. “Ghawar is very healthy:’ says Saudi Aramcn’s upstream chief Amin Al-Nasser. “If I needed more production, I could go to Ghawar and boost it to 10 million bpd.” Aramco, now pumping fewer than 9 million bpd, insists it could sustain 12 million bpd for decades and plans to boost recoverable reserves 40% to 450 billion barrels, enough to last for 15 years at today’s consumption rate.

I think they think it’s possible:’ says Simmons, “But I guarantee you it isn’t. Remember that Royal Dutch Shell also believed passionately five years ago that it had 16 billion barrels of proved reserves.” It then took 4 billion of those barrels off its books and the responsible executives off its payroll.

Mattew Simmons of Simmons & Co...a Houston investment bank he founded 40 years ago