Gas Will Get Cheap And Plentiful - That Other Gas Causes A Glut

by Bertel Schmitt

Published: January 24th, 2013

gas will get cheap and plentiful that other gas causes a glut

Reuters has a highly interesting oil and gasoline story. If you are one of the “peak oil” types

, you may not want to hear it. As a matter of fact, it could shake your belief system so much that you scream “BIASSSSSSSS.” As a service to all our readers, we give you a chance to stop before it gets ugly.

So much money is made to convert crude oil in to motor fuels, that power and industry can’t afford it, making power and industry switch to other fuels, mostly gas. Motor fuels however is a low growth industry. What’s more, it could also easily switch to natural gas. The effect is an oil glut.

BP predicts a worldwide oil demand growth of just 0.8 percent a year up to 2030 – slower than for any other energy type and only half the projected total energy demand growth rate over the same period.
Transport is slow growing as cars are getting more efficient. BP’s Outlook 2030 study shows the fuel economy of new cars in the United States and China falling well below 5 liters per 100 kilometer by 2030 from between 7 and 8 now.
In OECD countries, transport fuel demand is set to actually fall as weak economies, a shift to smaller cars, and a move onto public transport in congested urban areas take a further toll.
Worldwide, gas, biofuels and other alternatives are expected to steal almost a third of what growth there might be.

Gas is already approaching a similar overall market share to oil in the world’s energy mix. Liquefied natural gas (LNG) already is a viable transport fuel, and oil executives are starting to see a point at which familiarity and availability could tip the balance away from diesel and gasoline. Big oil players are already heavily invested in LNG.

LNG is expected to replace diesel in trucks and buses, ships, even airplanes first, before it makes a difference in private cars some decades away.

LNG-powered ships are already a reality. The first commercial gas-powered civil aircraft flight left Doha for London on Jan. 9 this year, fueled by jet fuel made from gas.

#BertelSchmitt #Gasoline #OilGlut

Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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4 of 65 comments

Beerboy12 on Jan 24, 2013

I wonder if the analysis takes into account (it is not mentioned) emerging economies such as China, India, Russia, Brazil and large parts of Africa. As their economies grow the growth in vehicle ownership will hugely out pace population growth. Considering the low-tech, poorly maintained vehicles that these poorer nations will be using their demand for fuel could be dramatically more than in Europe, UK, Australia and the USA.

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Niky on Jan 24, 2013

Don't know why this article would upset anyone who "believes" in peak oil. We're already at or past the peak for traditional Arabian oil. That fact hasn't changed. Oil Shale finds are proving to lose productivity not long after they are tapped. Peak Oil, there, done with. That's it. And all the alternatives cost more to develop, because no way in hell is anybody drilling for Oil Shale for lower margins. Only LNG makes as much sense as gas or diesel... or even more sense... but adoption slowed after gas prices fell back down. LNG won't last forever, but it's a good interim technology with low costs to adoption that can be applied almost universally to our current auto fleet. Except for you lot with those stupid expensive gasoline direct injection motors...

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- See 1 previous
- Sometimealone on Jan 25, 2013
  
  The thing about the alternatives is that people rarely think about all of the steps involved and the costs in energy and money. And that's the stuff that matters. It doesn't matter if someone's found a way to make a fuel that is just as good as oil in almost all respects if it requires 3x as much energy to create it and a massive new infrastructure to keep it going. I also don't understand how this somehow disproves peak oil. There have been delays and alterations to Hubbert's Peak before, because it is an approximate curve. There's no reason to believe that this isn't just another odd bump on the graph. In fact, near the peak you'd come to expect these kinds of irregularities due to governmental interference, uncertainty in the global markets, geopolitics, etc.
  
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- Luke42 on Jan 26, 2013
  
  Natural gas kicks the peak oil and climate change problems halfway down the road. As a pragmatic person, I see this is another a good thing and inevitable. Peak oil is going to happen sooner or later, probably before I retire. Peak oil is inevitable, bit the details of when and how it happens are negotiable if we as a society have our act together. Using the next best fuel seems to be the natural thing to do. I LIKE electric cars and photovoltaic panels, and I expect to own them - but society at large will probably just use the next best fuel, which is both practical and the obvious consequence of three hundred million people making decisions on their own - which is how we do things in the USA. So, larger scale adoption of natural has sometime in the next 1-3 decades is a practical and inevitable consequence of peak oil and American culture. The people who are upset by hope and partial solutions are doomers and/or ideologues. These people dont live in the real world, and there's really no practical way to satisfy these people, so why even bother....!
  
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