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Strategies & Market Trends : Booms, Busts, and Recoveries
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To: Slagle who wrote (68168)8/27/2005 3:38:32 PM
From: Elroy Jetson  Read Replies (2) of 74559
 
I think improvements in industrial processes are more rapid than you imagine.

Standard distillation refining, used in the early 1900s converted only 15% of crude oil into gasoline or kerosene. Today roughly 58% of crude oil is converted into gasoline or kerosene with a larger percentage increase in the production of chemical feed-stocks such as olefins which produce plastics and other chemicals.

This progress has been fairly linear over time. Improvements in yield have come from the addition of hydrogen from steam and a reduction in nearly worthless products like petroleum coke, which is a product similar to coal. Further steady improvements continue.

Even in high efficiency industrial processing, even using co-generation, more than 30% of the energy used is expelled through exhaust stacks. When thermoelectric production can achieve even 20% efficiency, this waste can be profitably used.

There are massive potential savings using low-temperature geothermal heat (available everywhere) and heat exchange technology to provide heating and hot water for buildings.

This progress continues steadily and will be greatly accelerated if higher energy prices can be maintained. Understanding this potential impact on their market, the Saudi's worked hard to increase production sufficiently to depress oil prices after the oil spike of 1973 to 1981. Hopefully they are losing the ability to do this.

China's widespread energy shortages, created by retail price controls, have led many to falsely assume we are quickly running out of resources which will lead to resource wars. Higher prices will encourage wiser usage, but there is a bright future.
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