Opinion: The Main Reason Oil Prices Are High Is Speculation

Global Petroleum Club ImageSherlock Holmes once asked, “How often have I said to you that when you have eliminated the impossible, whatever remains, however improbable, must be the truth?” Or, more generally, you can reason by elimination: if you cannot deduce the cause of an event directly, you can still zero in on it by eliminating other possible explanations. This is familiar to any parent: if I come back downstairs from the attic and notice that a plate of cookies, there 10 minutes ago, is now empty, and the only other person in the house is my 6-year-old, I can state with absolute confidence that she ate them. I don’t need to catch her in the act, or even follow a trail of crumbs up to her room—the mere fact that there is no other possible perpetrator points inexorably to my young daughter....

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Tobacco turns green leaf as possible biofuel, home insulation

Global Petroleum Club ImageTobacco, a crop under siege as the number of smoking bans in the United States continues to increase, may be turning a new leaf as a possible source of home insulation and biofuel.

At Thomas Jefferson University in Philadelphia, researchers at its Biotechnology Foundation Laboratories have figured out how to tweak the genes in tobacco plants to increase their oil production, which could help spur their use as biofuel.

"Tobacco is very attractive as a biofuel because the idea is to use plants that aren't used in food production," said study co-author Vyacheslav Andrianov, assistant professor of cancer biology at Jefferson Medical College. He added:...

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Palm Oil Boom Creates Danger For Orangutans

Global Petroleum Club ImageWildlife conservationists say a boom in palm oil -- used extensively for biofuel and processed food like margarine -- has affected the jungles in Borneo, endangering the already declining orangutan populations, AFP reported.

Experts believe that among the 50,000 to 60,000 orangutans left in the wild, some 80 percent of them are in Indonesia and the rest in Malaysia's Borneo states of Sabah and Sarawak.

However, the charismatic red-haired apes will be virtually eliminated in the wild within two decades if current deforestation trends continue, according to a 2007 assessment by the United Nations Environment Program....

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Treating Oil Addiction

Global Petroleum Club ImagePublished: September 18, 2009

“Fuel,” Josh Tickell’s unabashedly intimate, 11-years-in-the-making attack on America’s addiction to oil, is not so much a green documentary as a red, white and blue alarm. But if you can resist the urge to run for the exit, you may leave the theater feeling a lot more hopeful than when you went in.

A sustainable-energy evangelist whose church is a van that runs on grease, Mr. Tickell contends that the oil industry poisons our environment, corrupts our government and cooks our planet. Galvanized by a childhood spent among the oil refineries and pollution problems of Louisiana, Mr....

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Navy Green: Military Investigates Biofuels to Power Its Ships and Planes

Global Petroleum Club ImageShips powered by algae and planes flying on weeds: that's part of the future the U.S. Navy hopes to bring to fruition. This week, the seagoing branch of the military purchased 40,000 gallons of jet fuel derived from camelina—a weedy relative of canola—and 20,055 gallons of algae-derived diesellike fuel for ships.

"The intent is for these fuels to be drop-in replacements," although initially they will be blended with their conventional counterparts, says Jeanne Binder, research and development program manager at the Defense Energy Support Center (DESC), the U.S. Department of Defense's combat logistics support agency. "The test results will bear that out."...

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It’s Over: Five Reasons the Electric Car Wins

Global Petroleum Club ImageIt could take ten years or more to become apparent, but I’ll call it now: the electric car will replace the internal combustion engine.

A caveat: I am not an automotive industry expert. Which is why I’m right. I’m not mired in the details, the past failures, the what ifs or the buts. All I see are the big, obvious things. When it comes to sea change in human behavior, though, obvious matters.

So, since no prediction is worth its salt without an accompanying list, the following are five overlapping reasons why our children will all be driving electric cars.

(By the way, these all assume that business as usual, that is, cars running on gasoline derived from (imported, finite, polluting) oil, is unsustainable. If you disagree, you’re at the wrong website.)...

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Biofuel Bet Aims to Harvest Fish That Feed on Algae

Global Petroleum Club ImageEach spring, fertilizer runoff from the Mississippi River floods into the Gulf of Mexico, causing a massive algae bloom that leads to a giant oxygen-deprived "dead zone" where fish can't survive.

Now, this annual problem is getting new attention, not from marine scientists but from entrepreneurs looking for a new domestic source of fuel. And one start-up sees fish themselves being part of the process.

The algae blooms are spawned each year as the farmland runoff from as far away as Montana flows into rivers, eventually reaching the Mississippi and flowing into Louisiana bayous and out into the Gulf of Mexico....

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Oil Market Outlook

Global Petroleum Club ImageThe battle between US rescue plans and the recession is escalating, leaving oil prices directionless. Last week, the price of West Texas Intermediate crude rose more than $4 in the wake of the announcement by the US government of the plan to rescue Citigroup, the weaker US dollar, high expectations of the US government bailing out General Motors, and China's interest rate cut of 1.08 percentage points to 5.58% to boost economic growth.

However, any gain in the oil price was limited by worrying economic data, which included the US consumer spending shrinking in the third quarter by the steepest rate seen in 28 years; demand for durable goods decreasing twice as much as forecast; and China forecasting that GDP growth for the fourth quarter would slow to 8% from 9% in the third quarter due to declining exports and increasing unemployment....

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What lower oil prices mean for the world

Global Petroleum Club ImageOil prices are a barometer of the world economy. Rising prices between 2003 and 2007 reflected the best global economic growth in a generation.

This high economic growth was brought to an end not only by underpricing of risk, excess liquidity and over-confidence but also by an increasingly unsustainable commodity boom – of which oil was a crucial part. Now, as the world has dropped into recession, oil prices have fallen by more than half.

This fall also reflects the power of price itself. For rising prices set in motion decisions by consumers, governments and businesses that have changed the course of demand. Now the recession is also weighing increasingly heavily on demand....

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Note to hedge funds: go short on letters to investors

Global Petroleum Club ImageWhat do you do when you lose billions of dollars short-selling Volkswagen? Here is what hedge fund managers did last week: they sat down and cried.

This was the most delicious detail in an utterly delightful story. To read in the FT that these tough guys wept because no one had told them Porsche had built up a stake in the carmaker must have delighted many commuters as they made their chilly way to work last Wednesday.

It filled me with special satisfaction as I had just been doing some detailed textual analysis of the letters that hedge funds have sent out to investors in the last few weeks to explain away their abominable performance in the third quarter....

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