May 18, 2009
US Auto Fuel Efficiency To Rise Even Faster

Back in January 2007 the Bush Administration and Congress agreed to raise standards for auto fuel efficiency. Now the Obama Administration has decided to raise those standards even faster. The Obama Administration has decided to accelerate the rate at which car fuel economy must rise.

By 2016, passenger cars must average 39 miles per gallon and light trucks 30 mpg. A senior administration official said the proposal will boost the price of the average price of a vehicle by $1,300 -- or $600 more than the per vehicle increase predicted under a Bush administration fuel efficiency proposal.

The proposal will force automakers to meet a fleetwide average of 35.5 mpg by 2016 -- four years ahead of what Congress required in 2007, when it mandated 35 mpg by 2020. The higher costs could add $13 billion to $20 billion annually in total new car costs.

My take: this regulation will help prepare the auto makers for Peak Oil. Granted, the politicians in Washington DC seem oblivious to that approaching disaster. But by accident the US government is causing auto makers to take some steps to prepare for Peak Oil.

The effect on CO2 emissions won't be that large because cars account for less than a fifth of US CO2 emissions.

Cars and light trucks account for 17% of total U.S. greenhouse gases, according to EPA data.

By contrast in 2006 35% of US CO2 emissions came from electric power generation To cut CO2 emissions in a big way requires cutting coal electric power plant emissions in a big way. But doing that will increase electric bills in lots of states. So you do not hear the Obama Administration touting a similar scale agreement that cuts CO2 emissions from the electric power industry.

Internationally burning coal is the biggest single source of CO2 emissions.

Coal’s share of world carbon dioxide emissions grew from 39 percent in 1990 to 41 percent in 2005 and is projected to increase to 44 percent in 2030. Coal is the most carbon-intensive of the fossil fuels, and it is the fastest-growing energy source in the IEO2008 reference case projection, reflecting its important role in the energy mix of non-OECD countries—especially China and India. In 1990, China and India together accounted for 13 percent of world carbon dioxide emissions; in 2005 their combined share had risen to 23 percent, largely because of strong economic growth and increasing use of coal to provide energy for that growth. In 2030, carbon dioxide emissions from China and India combined are projected to account for 34 percent of total world emissions, with China alone responsible for 28 percent of the world total.

Flat and eventually declining oil production will increase the demand for coal and natural gas. But I expect one net effect of Peak Oil will be a lowering of CO2 emissions. Already the big run-up in oil prices that peaked in the summer of 2008 caused changes in consumer behavior that cut oil demand and the high oil prices contributed to the recession that cut oil demand even further.

What remains unclear to me: how fast will battery technology improve? Higher fuel efficiency standards and declining oil production will be a lot easier to handle with better batteries for longer range electric cars.

Update: Some argue against higher fuel efficiency standards based on safety concerns. However, while that's probably true overall there are some cases where it is not true. SUVs are safer for passengers than small cars - as long as you are in the SUVs hitting the small cars. But small cars are safer the fewer SUVs are on the road. Higher mass in a car makes that car more dangerous to other cars it runs into.

Share |      Randall Parker, 2009 May 18 11:47 PM  Climate Policy

Bob Sykes said at May 19, 2009 5:53 AM:

Unless the electricity for the batteries comes from nuclear power plants, any switch to electric cars will only increase their CO2 output. If we are serious about CO2, we will need to build very quickly around several hundred nuclear power stations. We need 100 to replace the 40 year old plants we have, and another 300 to get us up to France's level of 80% of electrical power generation. If we have electric cars, we will need a few hundred more nuclear plants.

I don't see this happening. Instead, for every 1% reduction in CO2 emissions, we will get a 1% reduction in industrial and agricultural output, a 1% reduction in transportation, etc. Reducing CO2 emissions cause the greatest world depression and famine in history, infinitely more severe than that of the 1930s. That depression gave us fascism and world war and 50 million deaths. It will be worse this time, and America itself will sink into fascism. Washington looks a lot like Germany in 1934.

Robert said at May 19, 2009 6:14 AM:

This is insane. CAFE is probably one of the worst pieces of energy-related legislation ever passed (along with its evil cousin, the ethanol boondoggle.) If you want people to use less of something, raise the price. Raise the gas tax to $2 per gallon, and people will naturally shift their buying toward more fuel-efficient vehicles. Look what happened when gas went to $4 per gallon. Gas demand collapsed.

Randall Parker said at May 19, 2009 7:45 AM:


Congress doesn't raise the price of gasoline because people hate higher prices, especially due to taxes. So instead Congress uses CAFE standards.

Yes, corn ethanol is a really bad idea.

Bob Sykes,

Some of the increased efficiency will come from hybrid designs. That'll definitely decrease CO2 emissions. Some will come from smaller cars. That'll decrease CO2 emissions as well.

Some fuel efficiency increase will come from lighter weight materials. Not clear what the net effect is with lighter materials. Some are more energy intensive to make. But my guess is they deliver a net fuel savings.

A shift to electric power for cars will cut CO2 emissions because not all the incremental electric power will come from coal burning. If all the electric power did come from coal burning I'm not sure there'd be an increase or decrease in CO2 emissions. It might depend on the efficiency of the CO2 plant designs. I think studies have been done on this and maybe I even posted on them.

Dave said at May 19, 2009 8:48 AM:

An 'Air-fuel' battery was mentioned on Science Daily, with the claim that it can last 10x longer than designs currently available.

fabulous max said at May 19, 2009 11:20 AM:

Raising gas prices would kill off what is left of the economy. It is easy for you to sit from on high and prescribe "cures" as they pop into your head. The real world knows better.

America's car makers have been slapped around by Obama long enough to know not to object to anything the egocentric messiah says. Naturally they go along with this crap.

Obama will be gone by the time the excrement from this insanity hits the fan. That is the point of all of Obama's policies. He will be gone by then. Let some other poor dolt take the blame. Obama means well, I think. But he is one sorry incompetent drop of dew.

And realists study potatoe growing... said at May 19, 2009 11:59 AM:

Fabulous max is unduly optimistic. It will all hit the fan long before Obama is out of office. We are in a depression ALREADY, even before any serious fallout from extra government regulations, spending or disruption of Asian financing of US debt. There is no way out of here but down, and the new energy policies will speed our way. As will some idiotic conflicts with China over human rights of somebody or other that IMHO are inevitable with this sort of raving lunatics in charge in America. Well, forest fires make way for eventual new growth, but it sure isn't pretty for those caught in the midst.

Michael Burns said at May 19, 2009 12:28 PM:

It is true that people hate it and it is politically toxic, but Robert is right. Increasing the price or selling some kind of cap and trade instrument (though it wouldn't likely work in consumer markets) are the only ways for the government to make people use less gasoline and improve technology in a relatively economically efficient way. As the law is written, when standards are changed, everything already existing is grandfathered in. Also, no matter how much advances are made in cars to make them more efficiency, the gas that is saved from being consumed will simply be consumed by other means. That's why increased prices are key. Actually, I read this interesting piece that a think tank of economists wrote. It said that if all the developing countries in the world stopped subsidizing the consumption of gas and denial and all of the countries in the world adopted a 100% tax on all of the petroleum used, then three things would happen. First, prices of oil would fall before taxes, though prices after taxes would rise, such that the rise in prices wouldn't be nearly as severe as 100%. The increased price of oil would cause there to be less pollution and oil consumption in a relatively economically efficient way. The third effect is that most of the excessive wealth (profit, but mostly economic rent) made by the oil countries like Saudi Arabia and Russia would suddenly be going to oil consuming nations instead of just oil producing countries. In other words, I think if all countries taxed oil, then I think it would be a lot more palatable than one country because when one country taxes it, then their consumers are worse off and the oil is simply consumed by other countries at a lower price.

I agree with fabulous max though, any increase in taxes should be done during an expansionary period of the business cycle, not just before the country enters the recovery phase. The government's policy regulating consumption is 90% ineffective (or otherwise economically inefficient) for reasons I mentioned in the preceding paragraph.

Michael Burns said at May 19, 2009 12:59 PM:

In response to the potatoe guy...

The actions of the Federal Reserve will likely (though not definitely) cause inflation which will be felt in a year or so. The negative consequences of how Bush and Obama handled the recession will for the most part, not be felt for a while. They essentially prevented a depression by preventing some of the very necessary market corrections from taking place. They also made the U.S. economy's fundamentals worse in several ways. The put the U.S currency in at risk by borrowing so much money because if other countries decide to start using the IMF's currency to fix their currency to, then the interest rates on the U.S. debts will go up and the real exchange rate will greatly depreciate. They made it easier and cheaper for people to take out loans on homes and credit card debt. That will make people borrow more and save less. A negative savings rate and very high investment in consumption and residential real estate (unproductive investment) was one of the major causes of the economy becoming a house of cards that a little bit a turbulence in the housing market was able to blow over. America can't afford to lose international investment. On the other hand, it would take a long time for this to manifest. This means we are at risk of a second crisis, but not of a depression. Also, it would take more than a decade for countries to slowly dump U.S. dollar denominated assets. If they dumped it quickly, then they would lose a huge percent of their investments because it would trigger a precipitous crash. They are not that stupid. Other than that, so far Obama hasn't done any more harm than the average president would have done. This isn't to say that he won't, but I don't think he has really done much of anything other than rubber-stamping congress. It's mostly just media hype.

K said at May 19, 2009 2:17 PM:

I'm not going to take a position on this change. After too many years of financial analysis I know the numbers can support almost any conclusion when a matter is sufficiently complex. And doubly so when they concern the future.

And this is certainly sufficiently complex and about the future.

But there are other ways we might do things. I suspect fuel efficiency would be raised more and emissions reduced considerably by simply giving people a new car when they scrap their licensed car made before 1998. And each year increment; 1999, 2000,

It might cost the nation less too. And certainly the autoworkers would cheer. I'll guess five million cars/year at $20,000/car. Five times twenty is 100 followed by nine zeros.


Why it seems to be $100B. No problem. These days politicians will spend that much subsidizing hair gel.

But one thing always leads to another. Those people with their new cars wouldn't have enough money for the higher insurance premiums. So a program to pay premiums would follow. And a program to compensate auto dealers for lost sales. And how about compensation for the mechanics who depend upon repairs to old cars for much of their income? Wouldn't this be devastating to commercial credit firms who finance car loans?

And miles driven might rise when drivers see their gasoline costs fall. That wouldn't be good.

Well, snags can be fixed, bureaucrats do that well. Yet it seems somehow inconvenient to mandate changes for today. Let us mandate changes for 2016.

Good Tuesday from Arizona.

K said at May 19, 2009 4:43 PM:

Five million was predicated on the fact that a good number of the cars made before 1998 are no longer on the road. So those never would go into the program.

But being picky about costs is not the government way. If it came out 20 million cars that wouldn't bother them.

Now on the other hand, if they find a lot more steroid users in baseball that would be a serious matter.

menomnon said at May 19, 2009 4:58 PM:

You know, given the extraordinary economic meltdown that's occurred (I'm currently reading Minsky's _Stabilizing an Unstable Economy_) and the need for the Obama administration to hit the ground at warp speed (yes, yes, yes, in spite of the appts debacle), why don't we back up a bit and wait to see what the Obama administration wants to do about coal. He (and they) are very smart and conversant with all the big issues - I think something will be forthcoming.

By my own calculation (using: if a handful of US power companies (e.g AES) are targeted and their 2 GW coal burners - all in either the Southeast or lower Midwest, that would make a surprisingly sizable dent in US electricity-generation CO(2) output.

I know it's popular (and conventional wisdom) to demand 350% yesterday. And be eternally skeptical. But as someone who missed dying at 21 of cancer and then returned, on his own dime, to finish two degrees a Berkeley ... well I guess I look at things differently. I roll with the punches and feel optimistic about the ability of human beings to rise to challenges when the need arises. It's corny shit only if you haven't gone through it.

menomnon said at May 19, 2009 5:01 PM:

and their 2 GW coal burners WERE CLOSED. And since they're politically powerful companies let's give them incentives to do that (and maybe some sticks too).

Engineer-Poet said at May 19, 2009 5:42 PM:

I don't get this.  What's the grounds for objection?  13,000 mi/yr at 35 MPG is roughly 400 gal/year.  At last year's gas prices, you'd be spending over $1600/yr in fuel; the added cost would pay for itself 2-3 times over the life of the car, roughly 20% per year ROI.  (Note that this doesn't count savings from depressed world crude prices due to lower demand.)

That's exactly the sort of investment that free-marketers tout when anything else comes up, but when it's a vehicle technology it is immediately denigrated as "tree-hugging hippy crap".  All this goes to show is that this crowd has its ideological blinders firmly in place, and puts its membership in the anti-left tribe above any questioning of the shibboleths of that tribe... illogical and contrary to the national interest though they may be.  Fabulous Max gives a prime example:

Raising gas prices would kill off what is left of the economy.
Most of Europe has had gas taxes more than twice our gas prices for years, and guess what?  They took less damage to their economy from last year's price spike than we did, because there's less oil needed for every bit of GDP.

What hurts our economy isn't money spent at the pump, it's money that leaves the economy for e.g. Saudi Arabia or Venezuela.  The gas tax has the virtue of staying at home.  What the USA needs is $5/gallon gasoline, so that crude stays where it is long enough for us to get other measures in place.  We need to do this now, because world oil production is past peak and we have no more time to waste.

T. J. Babson said at May 19, 2009 6:37 PM:

We are not getting Big Brother, but Big Nanny. Raise the gas tax, let people decide for themselves what car to buy. Reduce payroll taxes to compensate for the increased gas tax.

Fat Man said at May 19, 2009 10:00 PM:

1. Where do they get these numbers from? If 39 mpg is good, wouldn't 99 be better?

2. Before the depression the average automobile gave about 18 years of service. That number seems to be going up. Lots of car people believe that it could reach 25 years. The US has about 1.2 vehicles per licensed driver, and about 833/1000 population. The market is, if anything, supersaturated. It will take years for 39 mpg cars to be a large fraction of the fleet.

3. This may just be a revenue measure. CAFE is in essence a sales tax on cars. You pay it if you buy a Mercedes S. By 2017, you will be paying it on Kia Rios.

4. This was not a political victory over the car companies. GM and Chrysler are owned by the government. Ford has no allies. The Japanese have decided to lay low and laugh all the way to the bank. Learn to say keijidosha.

5. "But let me be clear that hybrid cars are designed solely to milk the guilt genes of the smug and the foolish. And that pure electric cars, such as the G-Wiz and the Tesla, don’t work at all because they are just too inconvenient." Jeremy Clarkson

David Govett said at May 19, 2009 10:37 PM:

EVERYTHING Obama and his D.C. buddies are doing will accelerate the decline of America relative to China. One result: Americans will be driving Chinese cars in about 10 years. The joke then will be that the U.S. has the economy of France and the auto industry of England. No doubt that is the objective of many Americans of the leftist persuasion.

Randall Parker said at May 19, 2009 11:05 PM:


I know I've posted (and I think Nick G has posted) numbers on vehicle miles traveled and age of vehicle. Basically, half of all vehicle miles traveled are done with cars in their first 6 years on the road. So if new cars had double the efficiency we would cut fuel usage by a quarter 6 years later.

Voice of Reality said at May 20, 2009 12:05 AM:

Again. There is no such thing as Peak Oil. Oil is the second most plentiful substance on the planet, is subject to the Law of Substitution like everything else and the so-called exhausted oil fields (a) are not and (b) are refilling from below.

Additionally, going nuclear first with fission and eventually low-temp fusion, would totally cover the worlds energy budget. I would not be surprised to see, maybe within 2-3 years, major advances in fusion tech as a result of the crazy political runups in the price of oil.

More on topic -- It is impossible to legislate physics. If you want a car that is safe and efficient it cannot have an astonishing gas mileage. The variables are what they are. To have a 42 mpg CAFE car you have to build a lightweight deathtrap. Obama should be removed from office and impeached for sheer stupidity (though those of you who want to see him hang for treason have a strong argument).

Lastly, just as Peak Oil is FUD chimera nonsense, please remember that all the hang-wringing over CO2 is also nothing but political FUD chimera about global warming designed to prepare the world for a global tax. Human-caused global warming is bunk: Data in spades

Ned said at May 20, 2009 8:13 AM:

Kieth Hennessy ( has some interesting thoughts on Obama's proposal, based on NHTSA data. Here are some key points:

It’s aggressive.
Rather than maximizing net societal benefits, this proposal raises the standard until (total societal benefits = total societal costs), meaning the net benefits to society are roughly zero. This is not an invalid framework for making a policy decision, but it is unusual. It represents a different value choice.
NHTSA estimated that a similar option would cost almost 150,000 U.S. auto manufacturing jobs over five years.
NHTSA guesses that under a similar option, manufacturers will make huge increases in dual clutches or automated manual transmissions, a big increase in hybrids, and medium-sized increases in diesel engines, downsizing engines, and dialing back turbocharging.
It will have a trivial effect on global climate change.
The national standard = the California standard (roughly).
The auto manufacturers got rolled by the Governator.
Granting the California waiver means California has leverage for next time.
In Washington, EPA is now in the driver’s seat, not NHTSA.
Today’s action will accelerate EPA’s regulation of greenhouse gas emissions from stationary sources. While Congress is futzing around on a climate change bill, EPA is getting ready to bring their “PSD” monster to your community soon.


So let's see where we are now - fewer car sales due to increased prices, less safe cars, roughly 150,000 auto jobs gone forever, no significant effect on climate change, plus the EPA gets a dose of steroids!. Sounds like a winner to me!

jim moore said at May 20, 2009 9:45 AM:

Hey voice of reality,
You win a prize for the stupidest thing ever written in the comments of this blog. This is the prize winning quote:
"Oil is the second most plentiful substance on the planet"
Good god man, it would be difficult for you to be any more wrong. Do yourself a favor and Google your assertions before you make a fool of yourself.
This is a list of the chemical compostition of the earth’s crust:

Oxygen O2 46.6%
Silicon Si 27.8%
Aluminum Al 8.1%
Iron Fe 5.0%
Calcium Ca 3.6%
Sodium Na 2.8%
Potassium K 2.6%
Magnesium Mg 2.0%
others 1.6%

Carbon and hydrogen (the elements that make up oil) don’t even make the list.

menomnon said at May 20, 2009 11:22 AM:

I believe Randall's starting point was maybe more about greenhouse gases. As opposed to the CAFE requirements and scoring political points.

This is, from wikipedia, Greenhouse Gas Emissions by Sector.

Although this is for the entire world - I think the US is more skewed to transportation. Nevertheless the emissions are not concentrated in one sector and the problem must be attacked, simultaneously, on several fronts. Electricity generation, industrial processes (look up the company Allegheny Technologies), etc.

As regards the prevalence of hydrocarbons (now I'm back to topic drift as well), Thomas Gold's book, _The Deep Hot Biosphere_ was certainly interesting. Gold is (was) a scientific contrarian with, um, gold-plated credentials.

Fat Man said at May 20, 2009 12:29 PM:

"Basically, half of all vehicle miles traveled are done with cars in their first 6 years on the road. So if new cars had double the efficiency we would cut fuel usage by a quarter 6 years later."

Yesterday's papers. New vehicle sales have declined from 16 M/yr to 9 M/yr. The CAFE increase is a sales tax on new cars, explicitly or implicitly, that will suppress sales. Few new cars sold means more old cars on the road. YMMV.

menomnon said at May 20, 2009 12:51 PM:

"Yesterday's papers. New vehicle sales have declined from 16 M/yr to 9 M/yr. The CAFE increase is a sales tax on new cars, explicitly or implicitly, that will suppress sales. Few new cars sold means more old cars on the road. YMMV."

Implication erroneously applied.

That sales drop from 16M/yr to 9 M/yr: how much will this raise the average age of the fleet? As well as what portion of miles driven will be newer as opposed to older (however defined) cars.

My own back-of-the-envelope calculation tells me that sales slowing by even that much will not have huge _and immediate_ (or even soon) implications for the average age of the fleet. New sales (even with a huge drop) are at the margin (although a relatively thick margin).

And where do you live? Here in California's Bay Area - which some may consider unrepresentative but the Bay Area is something like 7 million people and California in general between 35 and 40 M people - people turn over (or at least they did in the past) their cars _very_ often. Hence the probably higher-than-avg propensity to lease.

All of which will and is changing under the current economic circumstances. But even if you live in a part of the US with very different behaviors as to how long cars are kept on avg, California is _enormous_, _immense_ and by far the largest (and most important) car market in the US.

Engineer-Poet said at May 20, 2009 2:46 PM:

One difference between FuturePundit and Michelle Malkin is that when somebody says something idiotic at FuturePundit, people point at the idiot and laugh (good job, Jim).  At Michelle Malkin, the idiocy is accepted as gospel and none bother to refute it... or perhaps they don't dare to.

The US transport sector may not be the biggest contributor to CO2 emissions, but it is THE most vulnerable to shortages of imported raw materials.  The average fuel economy of US passenger vehicles should be set at Fusion Hybrid levels, because high fuel consumption means that high prices for oil damage our economy long before consumers react to economize.  If the US public was informed and rational about this, we'd have people clamoring for higher fuel taxes to keep the money in our own economy instead of building skyscrapers in Dubai; instead, we have idiots who won't buy anything that isn't a truck that gets less than 20 MPG, won't support higher taxes because they "need" a truck, and could not care less that their choices mean moving wealth to Saudi royalty and other supporters of Al Qaeda.  Their "patriotism" is limited to bumper stickers, not any kind of action or sacrifice.

th said at May 20, 2009 4:33 PM:

"My take: this regulation will help prepare the auto makers for Peak Oil."

unfortunately for ace on peak oil at oildrum, world oil consumption persistently has been in the mid 80's for some time now, his Figure1 looks like something he just made up and illustrates the problem with credibility of anything marked from wikipedia.

"World oil production peaked in July 2008 at 74.82 million barrels/day (mbd) and now has fallen to about 71 mbd. It is expected that oil production will decline slowly to about December 2010 as OPEC production increases while non-OPEC production decreases."

this guy ace could be james hansen.

Randall Parker said at May 20, 2009 7:31 PM:

Fat Man,

Good point about higher costs depressing car sales. But lucky for this plan the financial crisis has depressed sales of current tech cars so that when (if?) the economy recovers there'll be more pent up demand which will find higher efficiency cars to buy.

However, I keep saying: Peak Oil is approaching (or maybe is in our rear view mirror).


If Peak Oil is near then the cost-benefit equation for this regulation is far more favorable than it looks from Keith Hennessey's viewpoint.


I am certainly worried about atmospheric CO2 build-up. But I'm more worried about Peak Oil. So I see this regulation as delivering a far bigger benefit for people when oil production starts dropping every year for decades to come.


It bears repeating: Political partisans are addicted to an irrational defense of their tribes and partisanship shuts down higher mental reasoning faculties.

Randall Parker said at May 20, 2009 8:10 PM:

jim moore,

I had no idea that Aluminum is 8.1% of Earth's crust. So then given enough energy we've got a huge supply of a light and very durable metal. Iron at 5% means we've got plenty of that metal for construction as well.

Aside: Potassium at 2.6% makes me think that Potash reserve depletion won't cause a big problem for future food production. I'm still worried about phosphorus reserves though.

Engineer-Poet said at May 20, 2009 10:14 PM:

th, you need to look at the analyses which go over those numbers.  An increasing amount of world liquids production is NOT crude oil.  It is natural-gas plant liquids (mostly C2-C6 hydrocarbons) or biofuels like ethanol.  These fuels have far less energy per barrel than crude oil, so the comparison is misleading.

Also, energy investment is plunging and will lead to supply problems early in any recovery, and those problems will hit at lower demand levels the longer the recovery takes to start because production capacity will have fallen further.  We need to work on conservation and efficiency as one of our highest priorities (with substitution on the same level).

menomnon said at May 22, 2009 3:42 PM:

I wonder to what extent people are aware of additions to old topics/comments.

Just came across some numbers. As of 2009-05-15 us oil consumption was 18.225 mil b/d (barrels per day). The 2007 figure for US oil consumption, according to, was 20.680 mil b/d. Down 2.425 mil b/d or 11.7%.

th said at May 22, 2009 4:31 PM:

poet, every data I see on oil consumption or production always includes liquid fuels, I think mr ace likes 71mmbbls because its low and gives the illusion of we're out of it.
Liquid fuels are indeed growing...
... due to the economics of higher prices, something I think is due partly to wall streets' speculators playing this peak oil stuff. Oil traders are a weird lot, they used to buy when a valve busted, sell an hour later and go on about their business, now daily reports on how close we are to no more oil seems to be feeding the frenzy. As far as capex spending plunging, I wouldn't doubt it, but probably mostly from nationalized producers who have highly levered economies that depend heavily on oil revenues. And as far as your patriotic speech goes, I assume you want us to triple up on ethanol production, since it as dumb an idea as higher taxes. ANWR, lets assume will be like prudhoe bay, 2 million bbls/d for 25 years would provide about 12% of our gasoline consumption, thats twice as ethanol at no cost to taxpayer or corn eaters and it reduces revenue to dubai, yuk yuk.

menomnon said at May 22, 2009 6:00 PM:

well my 20.68 mil bbd/day figure was from and now I think I have something better.

From (which one presumes are much better numbers) I see several months over 21.00 mil bbd/day. So the drop is somewhat greater.

Engineer-Poet said at May 22, 2009 7:20 PM:

th, take one look at the mentions of ethanol on my blog and tell me if I am fer it or agin' it.

The estimated production of ANWR is 1.6 mmbbl/d at the 5% confidence level, under 1 mmbbl/d at 50%.  By the time it could be brought on-line, world oil production will have fallen quite a bit (figure 3%/year), net oil exports will have fallen quite a bit more (exporters will satisfy their own demand first, and subsidize their own population - see Mexico and the entire Gulf region), and the balance will come from net importers like the USA.  We can either use a lot less gallons/mile or drive a lot less miles, take your pick.

Randall Parker said at May 22, 2009 9:17 PM:


See from the US DOE EIA Short Term Energy Outlook the World, US, and China liquid fuels consumption by year and US consumption broken down into 4 categories.

China's demand has grown even during the downturn. Gasoline will turn up before other fuels in the US.

th said at May 25, 2009 3:49 PM:

poet, the mean estimate is 7.8 billion barrels, that makes it 13 times a giant field, to this you say forget it? prudhoe bay was originally estimated at 9 b/bbls, it has so far produced over 14 billion, only when they do exploratory wells will we know, where are you getting this 3% stuff for depletion, non-opec and opec production continues to forge ahead, not down, Iraqi oil production has been artificially low since the first gulf war, they got an extra 2 mmbbls/d easy if they can get the right people in there.
I noticed a few weeks back, a major oil company dropping it's wind, solar, and other various nonsensical diversions, they are re-focusing all their efforts on oil production, don't you think these guys would be showing some serious interest in alternatives if oil was about to drop off the face of the earth, I tend to think watching what these guys do is a big clue into what lies ahead, they're running away from the segway/battery option and going for ultra deepwater or whatever works.

Engineer-Poet said at May 25, 2009 7:23 PM:


Are you insane?

the mean estimate is 7.8 billion barrels, that makes it 13 times a giant field, to this you say forget it?
The USA burns 1 billion barrels in around 50 days.  7.8 billion barrels is about 13 months of US consumption, less than 2 years of US imports.  Or, taken another way, raising fuel economy by 50% would cut about 3 mmbbl/day from gasoline consumption; this would come to 7.8 billion barrels in just 7 years, and the savings wouldn't be depleted at the end of that period.

Can you not get the fact through your head that we cannot drill our way out of this?

non-opec and opec production continues to forge ahead, not down
My god, you really are insane.  Merrill Lynch admits that non-OPEC production has peaked, and average decline rates are 4.2%/year (and accelerating).  Raymond James found that non-OPEC peaked in 2007, and OPEC peaked in 1Q 2008 (when crude prices were still on their way up, up and up).  Both the IEA and EIA agree.
Iraqi oil production has been artificially low since the first gulf war, they got an extra 2 mmbbls/d easy if they can get the right people in there.
And a 4.2% annual decline on 74 million bbl/day (crude+condensate, not including natural gas liquids) is 3.1 mmbbl/day... every year.  Bringing Iraq's full potential on-line would offset less than 8 months of that decline.
I noticed a few weeks back, a major oil company dropping it's wind, solar, and other various nonsensical diversions
You may have noticed that they were never seriously into those things, and were being out-competed by companies dedicated to those areas.  On second thought, no, you certainly wouldn't have.

bri777 said at May 26, 2009 2:59 PM:
"Look what happened when gas went to $4 per gallon. Gas demand collapsed."

Yeah. And so did the economy.

Engineer-Poet said at May 26, 2009 4:03 PM:

The economy collapsed because capital was flowing out of it, to the producers.  If we doubled the pump price with taxes, the money would stay home.

Don't we have some deficits that folks are worried about?

th said at May 26, 2009 4:11 PM:

"Broadly, oil production decline rates are a function of investment rates and the size and age of fields. All these factors point to steeper oil output declines going forward. However, the IEA works under the assumption of oil production decline rates of 4.7% to 2015, expecting an increase in non-OPEC output to 51 million bpd over the next seven years."

non-opec production 2007, 41mm bpd, pay attention to the last sentence, down then its up, this analysis is as dysfunctional as your assessment of windpower, your problem is your fetish with CO2, sorry, you lose.

Engineer-Poet said at May 27, 2009 3:40 PM:

Yes, the IEA operates under assumptions.  Those assumptions have been spectacularly wrong for the last several years, because the IEA estimates future demand and assumes that supply will materialize to meet it.  These assumptions started breaking down seriously in 2004 and the projections failed completely last year.

Engineer-Poet said at June 1, 2009 8:40 AM:

More on that, from Platts:

Aleklett's conclusions also hinted at a politically-driven agenda at IEA. He said the agency often takes the approach of "you should rely on us because we are telling you the truth, and governments around the world trust the IEA." The IEA's forecast on the rate of depletion is "outside reality."

IEA forecasts are "demand-driven," he said, assuming that if global economic growth averages 3%, "that is driving production." "They're giving oil supply estimates to support GDP esimtates," he said. "They are not allowed to give oil that does not show an increase in GDP in the future."

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