X-Message-Number: 24592
From: "Mark Plus" <>
Subject: Peak Oil threatens civiilian aviation
Date: Sun, 05 Sep 2004 08:24:25 -0700

Our civilization has already relinquished commercial supersonic travel (the 
Concorde) because of fuel costs. Peaking oil supplies now threaten 
commercial subsonic jet travel, including the ability of overseas 
cryonicists to get the North America. Manage your risk, not your terror -- 
though I suspect I'll be seeing more terror-management confabulations about 
how economics will conquer thermodynamics and geology and somehow 
miraculously give us an exponentially growing supply of oil [Mark Plus]:

http://www.azcentral.com/arizonarepublic/business/articles/0905oilfuture05.html

Global oil crisis lurking
Demand growing, supply leveling off

Marilyn Geewax
Cox News Service
Sept. 5, 2004 12:00 AM


WASHINGTON - With oil prices receding from this summer's records, motorists 
and airline stockholders are hoping for relief from high gasoline and jet 
fuel bills.

But many energy experts predict that not only won't the price decline last 
long, but Americans soon will have to say goodbye forever to plentiful, 
cheap oil.

With demand for fuel growing rapidly in China, India and other developing 
nations, "the world is entering a period of runaway growth in demand for 
fossil fuels," said Matthew Simmons, founder of Simmons & Co. International 
Ltd.

At the same time, growth in the supply of the most desired fossil fuel - oil 
- is slowing. No major oil fields have been discovered in nearly three 
decades. And despite record revenues, oil companies are barely increasing 
their production capacity.

The result in coming years: fuel prices far higher than anything seen so 
far.

For oil companies, "it's the end of growth - that's what peaking is all 
about," said Simmons, whose Houston-based independent investment bank 
specializes in the oil industry.

"A production decline doesn't mean you're out of oil, but it means that by 
2010, maybe you are producing 75 million barrels a day," he said, "and the 
world demand is maybe 90 to 100 million. It's that gap that creates chaos."

For many airlines, chaos already has arrived.

The Air Transport Association, an industry trade group, estimates that for 
U.S. airlines to simply break even, they need oil prices to stay below $31 a 
barrel. During the decade between 1992 and 2001, the median price was $20, 
allowing airlines to flourish.

On Aug. 19, the market peaked at a nominal record of nearly $49 per barrel. 
Though prices have receded, they remain high enough to guarantee losses for 
airlines.

If airlines raise fares to cover the steeper costs, customers stay home. But 
if they don't charge higher fares, they lose money on each flight.

"This is just untenable for us," said John Heimlich, the ATA's chief 
economist.

The airlines may be the canaries in the mine shaft, warning of the coming 
danger for the entire economy.

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