Merry Christmas everyone!
I hope everyone had a merry and relaxing Christmas, spent with friends and loved ones. Although I had a lot of pent up Christmas spirit in me, this being my first one in 4 years to be spent with my family, I have found that it has lost some of the magic for me. Whether this is due to my trip having put things into a different perspective, or whether it's just a case of getting older and increasing my humbug quotient I'm not sure, but some things, like putting up the tree and going Christmas shopping have become more of a chore for me. That said, there are still things that I appreciate: the laziness of being able to stay in and do nothing, seeing friends and gorging on mince pies and mulled wine (the latter being the true embodiment of the festivities for me).
Before the revelries began I had my first week at work. To be honest it was rather slow; partly due to the various administrative tasks that took a fair bit of toing and froing with the head office which is inconveniently located in the States, and also partly because it is a completely new position, both for me and the company, so I have to feel my way into what is required and do a lot of learning on the job, not least about the oil and gas industry. At least it has been very educational so far, as it has helped dispel some of the commonly held myths that circulate about oil.
Despite the price of a barrel of crude being at record highs and people everywhere complaining about how expensive it is, the black stuff is in fact pretty cheap. A litre of unrefined crude costs about 30p, about the same as the price of a Kit-Kat. Even at the pump, after having been refined, transported and taxed it costs about the same as bottled water. It is therefore ridiculous for people to complain about the price of petrol when they're prepared to pay the same amount for water which, and it is important to remember this, is available for free and contains no nutritional content (apart from a few trace elements). If one were to think logically petrol ought to be a good deal more expensive if one were to properly consider what you get for your money (not a popular point of view perhaps, but probably necessary for the future).
Similarly it is generally accepted that we are soon going to run out of oil. Now the veracity of that statement depends on your interpretation of the word soon, but there is certainly a good deal more of it than some scaremongers would have us believe. 20 years ago there were 875 billion barrels of obtainable oil reserves and today there are over 1200. That doesn't mean that they have miraculously appeared out of thin air, but that, due to improvements in technology, people have been able to find more sources of oil and extract greater percentages of it once they have found it. In a way it's unfortunate because, as far as the people who make the decisions are concerned, there's plenty of the black stuff about and so there's no urgency in doing anything to address the eventual demise of oil.
Another point of attack, especially for the anti-globalisation crowd, are the big oil companies. They are demonised for being incredibly rich and powerful and using their power and dominant position to ride roughshod over the interests of local people and even governments of developing countries. Now there is a certain ruth to this, and like all companies they are out to make a profit and stay ahead of their competitors, but one must also look at the facts of the business. The five biggest oil companies (known as IOCs, or International Oil Companies) have, together, less than 25% of world production and 15% of the world's oil reserves. Compare this then to NOCs (National Oil Companies, which are owned by state governments, such as NIOC in Iran, Aramco in Saudi Arabia and PdVSA in Venezuela) who produce more than 60% of the world's oil and own 80% of its reserves. When one thinks that these NOCs are often run by suspect governments that are accountable to no-one and endemically corrupt, the IOCs begin to look like paragons of justice with their shareholders and regulatory bodies keeping them in check and economic necessity ensuring that they aren't wasteful. And with regards to their wealth it is true that of the five richest companies in the world are IOCs, but that's not surprising when one realises that just to develop a single oilfield often requires investments in excess of a billion dollars. Small companies just don't have the capital, and very often the IOCs have to work together on the same field out of financial necessity. This isn't to say that they are without sin, far from it, but the alternatives are probably worse.
Anyway, that's enough about the macroeconomics of oil; since I haven't posted a picture in quite some time I thought I'd give you one that I took on my morning cycle to work as the sun was rising on Richmond Park.
Before the revelries began I had my first week at work. To be honest it was rather slow; partly due to the various administrative tasks that took a fair bit of toing and froing with the head office which is inconveniently located in the States, and also partly because it is a completely new position, both for me and the company, so I have to feel my way into what is required and do a lot of learning on the job, not least about the oil and gas industry. At least it has been very educational so far, as it has helped dispel some of the commonly held myths that circulate about oil.
Despite the price of a barrel of crude being at record highs and people everywhere complaining about how expensive it is, the black stuff is in fact pretty cheap. A litre of unrefined crude costs about 30p, about the same as the price of a Kit-Kat. Even at the pump, after having been refined, transported and taxed it costs about the same as bottled water. It is therefore ridiculous for people to complain about the price of petrol when they're prepared to pay the same amount for water which, and it is important to remember this, is available for free and contains no nutritional content (apart from a few trace elements). If one were to think logically petrol ought to be a good deal more expensive if one were to properly consider what you get for your money (not a popular point of view perhaps, but probably necessary for the future).
Similarly it is generally accepted that we are soon going to run out of oil. Now the veracity of that statement depends on your interpretation of the word soon, but there is certainly a good deal more of it than some scaremongers would have us believe. 20 years ago there were 875 billion barrels of obtainable oil reserves and today there are over 1200. That doesn't mean that they have miraculously appeared out of thin air, but that, due to improvements in technology, people have been able to find more sources of oil and extract greater percentages of it once they have found it. In a way it's unfortunate because, as far as the people who make the decisions are concerned, there's plenty of the black stuff about and so there's no urgency in doing anything to address the eventual demise of oil.
Another point of attack, especially for the anti-globalisation crowd, are the big oil companies. They are demonised for being incredibly rich and powerful and using their power and dominant position to ride roughshod over the interests of local people and even governments of developing countries. Now there is a certain ruth to this, and like all companies they are out to make a profit and stay ahead of their competitors, but one must also look at the facts of the business. The five biggest oil companies (known as IOCs, or International Oil Companies) have, together, less than 25% of world production and 15% of the world's oil reserves. Compare this then to NOCs (National Oil Companies, which are owned by state governments, such as NIOC in Iran, Aramco in Saudi Arabia and PdVSA in Venezuela) who produce more than 60% of the world's oil and own 80% of its reserves. When one thinks that these NOCs are often run by suspect governments that are accountable to no-one and endemically corrupt, the IOCs begin to look like paragons of justice with their shareholders and regulatory bodies keeping them in check and economic necessity ensuring that they aren't wasteful. And with regards to their wealth it is true that of the five richest companies in the world are IOCs, but that's not surprising when one realises that just to develop a single oilfield often requires investments in excess of a billion dollars. Small companies just don't have the capital, and very often the IOCs have to work together on the same field out of financial necessity. This isn't to say that they are without sin, far from it, but the alternatives are probably worse.
Anyway, that's enough about the macroeconomics of oil; since I haven't posted a picture in quite some time I thought I'd give you one that I took on my morning cycle to work as the sun was rising on Richmond Park.
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