An overview of the oil industry and its history

[Cannae]

Hello to all,

As of recent my interests in the energy industry have been dilating and I decided to read a few books on the subject. First off, I took a look at Beyond Oil by John Gever et al written back in the 1980's. He claims that, at the time, the energy situation in regards to oil was shaky. He uses the history of declining energy profit ratios as evidence of this. If you didn't know what an energy profit ratio is, it's a ratio of the energy attained from oil extraction to the energy needed to extract the oil. He also points out that oil, coal, etc. are important inputs to agricultural processes.
Next I looked at Amory Lovins' Soft Energy Paths. He looks at the costs of delivering oil to customers and the costs of operating certain energy businesses by units of joules. What was interesting about both Lovins and Gerver is that they use the laws of thermodynamics to justify the shortages of energy and thus their calculations.
As of late I've been reading Daniel Yergin's The Prize. So far he has covered Standard Oil (Rockfellers etc.) Russian energy development and the World War 2 energy dilemmas for Germany and Japan.

I have a few questions for the experts:

1. Do you think there is any historical or mathematical evidence that there is a shortage of oil based on consumer demands and the supply of oil?
2. Is there any alternative to energy efficiency, such as better methods of oil production, less corporate taxes (Windfall Profits tax etc.) employer wages, or just an alternative fuel?
3. How do the mechanics of oil companies work out, such as how do they price? Who buys shares? Do they operate on contracts with certain retailers and distributors? How does the extraction process work?

Statistics and references would be helpful but any input is appreciated.

P.S. I'm not sure if this was the right sub forum to post in or if some of the above has been discussed before.

[Processor]

Dear Cannae,

Very interesting topic.

Latest book on the topic is "The Quest: Energy, Security, and the Remaking of the Modern World". It is also by Daneil Yergin and infact considered sequel of "The Prize".
" Yergin proves that energy is truly the engine of global political and economic change, as well as central to the battle over climate change. From the jammed streets of Beijing, the shores of the Caspian Sea, and the conflicts in the Mideast, to Capitol Hill and Silicon Valley, Yergin takes us inside the decisions and choices that are shaping our future."
Your questions are very good and infact sometimes there is not a "yes" " no" type straightforward answer.
1- Practically energy supply-demand remains side by side (even historically), perhaps just few percent plus minus. Oil portion in the energy supply may however vary due to numerous reasons (which can be discussed separately). Infact there are numerous mechanisms (or perhaps dynamics) which keep supply close to demand and also keep demand close to supply. Similarly there are numerous mechanisms which define the portion of oil in total energy supply.
2- Energy supply source (like oil reservoir) is different thing while incurred costs (i prefer life-cycle analysis) and processing efficiency is different thing. Former can have scarcity while later governs the cost (including tax, royalty model, E&P cost etc.). So there can be alternative of "energy source" like hydrates in sea bed but not of "energy efficiency". Energy efficiency is applicable on all alternatives.
3- You have clubbed lot of different questions in point 3. Each needs separate response. Anyway, I'll check if some good reference is available to share with you.

Regards

Hello to all,

As of recent my interests in the energy industry have been dilating and I decided to read a few books on the subject. First off, I took a look at Beyond Oil by John Gever et al written back in the 1980's. He claims that, at the time, the energy situation in regards to oil was shaky. He uses the history of declining energy profit ratios as evidence of this. If you didn't know what an energy profit ratio is, it's a ratio of the energy attained from oil extraction to the energy needed to extract the oil. He also points out that oil, coal, etc. are important inputs to agricultural processes.
Next I looked at Amory Lovins' Soft Energy Paths. He looks at the costs of delivering oil to customers and the costs of operating certain energy businesses by units of joules. What was interesting about both Lovins and Gerver is that they use the laws of thermodynamics to justify the shortages of energy and thus their calculations.
As of late I've been reading Daniel Yergin's The Prize. So far he has covered Standard Oil (Rockfellers etc.) Russian energy development and the World War 2 energy dilemmas for Germany and Japan.

I have a few questions for the experts:

1. Do you think there is any historical or mathematical evidence that there is a shortage of oil based on consumer demands and the supply of oil?
2. Is there any alternative to energy efficiency, such as better methods of oil production, less corporate taxes (Windfall Profits tax etc.) employer wages, or just an alternative fuel?
3. How do the mechanics of oil companies work out, such as how do they price? Who buys shares? Do they operate on contracts with certain retailers and distributors? How does the extraction process work?

Statistics and references would be helpful but any input is appreciated.

P.S. I'm not sure if this was the right sub forum to post in or if some of the above has been discussed before.

[Cannae]

Dear Cannae,

Very interesting topic.

Latest book on the topic is "The Quest: Energy, Security, and the Remaking of the Modern World". It is also by Daneil Yergin and infact considered sequel of "The Prize".
" Yergin proves that energy is truly the engine of global political and economic change, as well as central to the battle over climate change. From the jammed streets of Beijing, the shores of the Caspian Sea, and the conflicts in the Mideast, to Capitol Hill and Silicon Valley, Yergin takes us inside the decisions and choices that are shaping our future."
Your questions are very good and infact sometimes there is not a "yes" " no" type straightforward answer.
1- Practically energy supply-demand remains side by side (even historically), perhaps just few percent plus minus. Oil portion in the energy supply may however vary due to numerous reasons (which can be discussed separately). Infact there are numerous mechanisms (or perhaps dynamics) which keep supply close to demand and also keep demand close to supply. Similarly there are numerous mechanisms which define the portion of oil in total energy supply.
2- Energy supply source (like oil reservoir) is different thing while incurred costs (i prefer life-cycle analysis) and processing efficiency is different thing. Former can have scarcity while later governs the cost (including tax, royalty model, E&P cost etc.). So there can be alternative of "energy source" like hydrates in sea bed but not of "energy efficiency". Energy efficiency is applicable on all alternatives.
3- You have clubbed lot of different questions in point 3. Each needs separate response. Anyway, I'll check if some good reference is available to share with you.

Regards

Ok. Will be checking the next few days.