Thread by @Dry_Observer

@AP No one is facing up to the scale of the demand crash.

We normally produce 80-million+ barrels a day, and half the world (the rich half, mostly) is under lockdown.

Do we need 3/4 of the oil we did? 1/2? 1/4?

20-million+, 40-million+ or 60-million+ barrels/day less?

@AP Does the lockdown end in several months?

A year or more from now, when we (hopefully) have a vaccine?

How much will our consumption habits have changed by then?

How much renewable power will have been installed?

How many vehicles will be hybrid or electric?

@AP How long will it take to recover from what is effectively a depression?

Then look at the underlying math for oil coming out of this era, which is even worse.

@AP The US military has a simple metric:

How much money would we save on an annual basis if we swapped out fossil fuels for renewables in this instance?

They then take a loan where the payments are substantially below the easily assessed savings.

They save money every month.

@AP So the military gets their renewables installed for what amounts to negative cost.

The Pentagon/US Federal government has tremendous credit, of course.

But there's a ton of institutions which could do this.

Businesses. State and local governments.

De facto negative cost.

@AP Is it beyond farmers?

What if the Federal government provided a zero-interest loan with payments that are again *below* the monthly saving accrued, w/payments beginning only once the system is purchased and installed?

In areas where renewables are viable, this would be swift.

@AP And if we simply looked at the key elements in our society that most need to function in the event of a major power disruption - from natural disasters, cyber-warfare or other sabotage - we could prioritize on that basis and accelerate the move to renewables more efficiently.

@AP A government or business deeply concerned about supply disruptions which looks at a grid at risk to assess what really *has* to keep working to avoid an area plunging into immediate crisis during any sustained grid-power failure finds the really key elements aren't that numerous.

@AP Water supplies and sewage, large food-storage facilities, fuel supplies (including gas stations) and hospitals are obvious ones.

But how many major intersections *have* to stay open in a small city during power failures to avoid instant gridlock?

20? 30?

@AP Solar-powered, charge-storing traffic lights already exist.

You don't have to change out everything.

Swap out the lights at key intersections, and just keep re-using the grid-dependent lights, elsewhere, replacing them as you can budget it in.

@AP Traffic lights are an example of something small and cheap that can make a significant difference if they're taken care of.

Homeland security demands a considerable budget. Could some of these demands be combined and offset?

Again, a cost of less than zero.

@AP Or charities engaged in carbon offsets could arrange loans requiring only a partial repayment, the rest forgiven, while plowing their considerable "profit" of being able to rapidly reuse the money into the next loan and the next.
futureimperative.blogspot.com/2008/05/how-ch…

@AP But the practical, technical issues with shifting to renewables in a major way have to a large degree already been solved.

Even without getting into radically improved methods, like cheap superconductive power cells or generating all our natural gas using algae in biodigesters.

@AP You can ask the @FBI how well that particular source of innovation is doing on the subject or tracking and mapping cryptocurrency and malware and the use of evolutionary algorithms in PSYOPs, or the military on how well that whole install-renewables-for-less-than-zero-cost thing.

@AP @FBI But to sum up:
You can dump algae into biodigesters & produce all the methane (natural gas) that you need.

Conventional GTL tech converts NG to oil at $25/barrel *without* pricing in de facto free energy or feedstocks.
futureimperative.blogspot.com/2011/07/amazon…

@AP @FBI A biodigester is a covered trench lined with block, w/a slurry of waste & water decomposing inside. Not exactly the most difficulty engineering feat if you have the lined hole and a sheet of plastic.

@AP @FBI So you can replace manure w/algae, throw in ruminant microbes from a sheep or cow (found in their cuds & outer stomachs) & rot it all down.

And yes, this is all public domain.

You're welcome.

@AP @FBI Most algae reproduces exponentially & most are autotrophic - requiring no complex organic molecules.

So recycle your CO2, exhaust (CO2/water) & decayed organics back in & you have an inexhaustible supply.

@AP @FBI You can also produce vast supplies of commercial CO2, fertilizer, charcoal & other products w/it.

Leftover organics? Dried out, & you're just a low-oxygen burn away from charcoal. & that's your *waste.*

Used slurry or charcoal can be used as organic fertilizer.

@AP @FBI Charcoal locks up carbon in your soil for many years. So pull millions of tons of carbon from the atmosphere.

The key isn't a net-zero carbon output.

It's a net-*negative* output until we can stabilize the climate.

@AP @FBI Charcoal can also replace coal in power plants, it just burns cleaner & hotter.

Or it can adsorb compressed natural gas, allowing CNG to be used as fuel in conventional gas-powered vehicles at a much lower pressure.

@AP @FBI Don't believe it? Just dig the trench. Given time & microbes - your algae *will* rot down on schedule.

Practical #Nanotech? Solar = to photosynthesis?

Why not use the algae & bacteria we already have?

Clean/efficient/cheap.

@AP @FBI Natural bacteria/algae can't be patented; even a poor villager w/a sheet of plastic & a trench can afford this.

Many companies promote their #algae research but the public domain is open to everyone. No need for patented tech.

@AP @FBI Also critical is the ability to swap out existing technology cheaply without an immediate multi-trillion cost in radically updating your infrastructure.

Example: Compressed natural gas can replace gasoline in normal cars - requires canisters, hoses & a switch on the dashboard.

@AP @FBI We can't instantly replace all of our cars with electric models, or natural-gas-powered buses, or electric trains.

But we don't have to.

@AP @FBI The Saudis said at the oil crash’s outset they could pump at $2/barrel.

An odd declaration, seemingly out of nowhere.

What do they know that most didn't?
npr.org/sections/money…

@AP @FBI A cheap, unlimited supply of clean methane & GTL produces unlimited oil at $25/barrel.

Yes, without counting an effectively free feedstock & energy source for the conversion.

The real cap is presumably lower than $25/barrel.
chemlink.com.au/gtl.htm

@AP @FBI Probably much lower, in practice.

Assuming you still *want* oil, with clean natural gas generating limitless electricity or pure-silica solar panels.

@AP @FBI Clean energy?

Raw heat, sand & a bit of recycled copper make pure-silica solar panels; less efficient than rare earth, but literally printable… from *sand.*
#3DPrinting

Or simply cast. The cheap, if less exotic method.

@AP @FBI Effectively free heat beyond the melting point of glass, recycled copper & #3Dprinting means solar panels for everyone.

The greatest cost to recycling metal, paper, plastic & glass? Again, raw heat, now virtually free.

@AP @FBI Recycle key waste streams & you have raw materials for #3Dprinters/#CNCs/#RepRaps.

Clean, almost free fuel/fertilizer/electricity for world’s poor is the best investment imaginable.

@AP @FBI Every NG power plant on Earth will realize they can run on #biogas, #recycle their exhaust & sell their refuse as #commodities.

No one owes you a market. Much less a toxic, $3 trillion+/year revenue stream that is killing the planet.

@AP @FBI With all that implies for energy, commodities, inflation and the economy. And human welfare.

So, oil with an effective cap of $25/barrel or lower vs solar & natural gas that are practically free.

@AP @FBI Anyone left in oil will be selling feedstocks & lubricants.

Which brings us back to Russia.

Russia’s economy - her per-capita GDP - fell 40+% from 2013 through 2015 in the wake of the 2014 oil crash.
google.com/search?q=russi…

@AP @FBI Remember how much Russia & OPEC struggled to cooperate in a net reduction of 1.7 million or so barrels a day during that plunge.

What will a demand drop of 4 – 8 million/day - or more - do to them?

What will a drop of 20 to 40 to 60 million/day do to them?

@AP @FBI Collapse in demand from the economy & renewables + vast oversupply = crash.

And now we're in a pandemic.

With most of the rich half of the world already in lockdown.

@AP @FBI Renewables and conservation aside, any significant drop in the global economy is echoed by a corresponding drop in demand for fossil fuels.

The supply-demand balance in oil and gas prices has always been precarious.

Welcome to the tipping point.

@AP @FBI In mid-2014, 25% of Russia's economy & 50% of her government revenues came from oil/gas.

Russia exports oil, gas & weapons.

And her various criminal enterprises.

@AP @FBI Taking control of the mafia's (Mob's) offshore LLCs for money laundering helped, but they're having trouble accessing offshored wealth due to sanctions and endless investigations from #FinCEN on down.

@AP @FBI We have already hit the key tipping point where new solar/wind are cheaper than new coal plants.

Coal is effectively finished as an energy source - as of 2016, the top 4 US producers lost 99% value in 5 years.

Gas & oil are on the same path.

@AP @FBI We could talk about global asset forfeiture, the implosion of their intelligence/organized-crime networks & the impact of the US power to cut them off from the global economy.

If our banks don't countersign you, no one this side of North Korea will.

@AP @FBI But let's come back to the present conundrum.

So... We just saw buyers wait until the price was *less* than zero on a commodity before purchasing it?

As global storage space runs out, how many discretionary buyers will wait until oil-delivery contracts come due?

@AP @FBI In other words, if you don't really *need* the oil, why not wait to see which gamblers bet wrong, & scoop up your winnings (sub-zero prices) before buying?

At most, you're apt to find prices closer to zero, if not below it.

But these bets are only *part* of the demand problem.

@AP @FBI Suppliers can slow production. It's really sealing a well permanently that's more significant.

But we have a wild oversupply, & global storage due to fill up in a few weeks.

What happens when it *costs* you to store oil, and the people you pay aren't willing to simply dump it?

@AP @FBI What happens when people holding oil go bankrupt, and there are creditors willing to sell at any above-zero price?

We could be looking at massively reduced demand for oil running for one or two years, even as renewables reduce overall demand for fossil fuels permanently.

@AP @FBI How can most suppliers compete against oil already in the system, which creditors are willing to sell for almost any positive price?

Remember, it *costs* them to hold it.

Some may be willing to take the hit and go slightly negative, if necessary, to avoid a long-term liability.

@AP @FBI So we don't just have overproduction, we have an immense supply overhang in front of us, in the face of demand apt to be very low for a couple of years, if not permanently.

And people are beginning to price in the risk.