EIA: Annual Energy Outlook, 2008

The Energy Information Administration (U.S. Department of Energy) has released a preview version of its Annual Energy Outlook 2008. A highlight:

In the AEO2008 reference case, real world crude oil prices (defined as the price of light, low-sulfur crude oil delivered in Cushing, Oklahoma, in 2006 dollars) decline gradually from current levels to $58 per barrel in 2016 ($70 per barrel in nominal dollars), as expanded investment in exploration and development brings new supplies to the world market. After 2016, real prices begin to rise (Figure 1), as demand continues to grow and higher cost supplies are brought to market. In 2030, the average real price of crude oil is $72 per barrel in 2006 dollars, or about $113 per barrel in nominal dollars.

$58/barrel in 2016 (a 38% decrease from today)? I’ll take the over.
The report cites increased production as a reason for the decrease. But, as Richard Shaw notes, much of the new production that will be coming online has a much higher break-even price. So even under a best-case scenario, it’s hard to imagine that long-term oil prices would drop that far (barring a world-wide depression).
On a related note, here’s an interesting 2005 UK documentary on peak oil. It’s about 50 minutes long; lots of good information.

The Holidays And Early Primaries/Caucuses

According to TV news, one of the weighty questions political experts are wrestling with is the impact that the holiday season will have on the early state primaries/caucuses. Because election calendar has been crammed forward this season, we have an unusually short gap between Christmas, New Year’s Day, and the first elections. In the reports I’ve seen the issue is typically framed in terms of the candidate’s campaigns: How do the holidays alter how the candidates run their campaigns? Will voters pay attention to their messages the last week of December.
My sense is the holiday break may have a marginal impact on the Iowa outcome, but won’t make a difference for the later states. The primary reason I think it might have an impact on the Iowa caucuses is because they come just two days after New Year’s Day. Hence some potential voters (e.g., college students) are still going to be on vacation instead of voting. That could make a difference in a real tight contest.
As for the holidays affect on the candidates connecting with voters, I don’t think that’s a significant issue. Think about it–many of the candidates have all but lived in Iowa for the past six months. If a voter is still undecided at this point, it’s not because he or she hasn’t had a chance to become familiar with the candidates–it’s because he or she doesn’t want to commit to someone. A few more campaign stops isn’t going to make a difference. The “undecideds” simply need to get off the fence.

TIme’s Person Of The Year

Time choses Vladimir Putin as it’s “Person of the Year.”
Predictably, the typical cast of right wing media stars is complaining about the selection. Essentially, their objection to Putin boils down to this: he’s not pro-American.
Time’s stated criterion for the award is straightforward; it’s given to

“the person or persons who most affected the news and our lives, for good or ill, and embodied what was important about the year.”

Yet rightist can’t seem to accept simply recognizing a world news maker. They instead view the selection as an award that should be bestowed on one of conservative America’s heroes. They apparently need every media outlet to validate their world view.
This phenomenon was most pronounced in 2001. Clearly Osama bin Laden was the person who had the greatest impact on world events. But political correctness prevented Time from selecting an anti-American figure, so it picked Rudolph Giuliani instead.
By the way, Time has archived all of its Persons of the Year (1927-2007) covers (with the articles) here.

Pelosi Surprised By Republican Resolve

CQ Politics:

House Speaker Nancy Pelosi, D-Calif., admitted Thursday that she had underestimated the willingness of Republicans to stand behind President Bush’s Iraq policy despite the drubbing the GOP took in the polls in 2006.
“The assumption I made was that the Republicans would soon see the light,” she said. Instead, the minority stuck to the president’s war policy in the face of unrelenting pressure from congressional Democrats and powerful lobbying campaigns by anti-war groups.
. . .
“That was a revelation to me, because I felt the American peoples’ voices were so strong and still are in this
regard that I hoped that with some compromise and reaching out there might be some change in direction,” Pelosi said. “But they are sticking with the president on this.”

One can only assume that Speaker Pelosi was surprised by the Republican behavior because it’s completely at odds with that of her own caucus, which seemingly buckles at the first hint that a policy position may be unpopular with 40% of the public.
You’d think that on issues (like Iraq) that are supposedly important to Congressional Democrats, they’d learn a few lessons from the GOP minority and try sticking it out on a position. But apparently that’s too difficult to follow.

U.S. House Steps Up To Protect Christmas

In a post lamenting another Democratic cave-in, Glenn Greenwald notes this unusual act of courage:

To be fair, the Democratic-led House was able to pass an extremely important bipartisan resolution yesterday — by a vote of 372-9 — which “recognizes the Christian faith as one of the great religions of the world”; proclaims that Christmas is “a holiday of great significance to Americans”; decrees that “Christians and Christianity have contributed greatly to the development of western civilization”; explains that “on December 25 of each calendar year, American Christians observe Christmas, the holiday celebrating the birth of their savior, Jesus Christ”; and “expresses its deepest respect to American Christians and Christians throughout the world.”
So it’s important to temper the criticisms of the Congress with an acknowledgment and appreciation for these brave and important achievements — one of the bravest and most consequential acts of Congress since they solemnly banded together to condemn MoveOn.org’s newspaper advertisement.

And some people complain about us having a do-nothing Congress.
Actually, the House did step up today by voting to ban waterboarding. With a double dose of protection, perhaps Santa won’t need to worry about being tortured this year.

Shared Sacrifice

Compare these two answers Mayor Rudy Giuliani (9/11) gave Sunday on “Meet the Press.”
Regarding the duration of United States’ occupation of Iraq:

MR. RUSSERT: Your best estimate as a potential commander in chief, how long will U.S. troops be in Iraq?
MR. GIULIANI: For as long as necessarily to get the strategic objective achieved. I mean, we, we, we have a strategic objective in Iraq, and sometimes we lose sight of that in light of all the politics that are surrounding it. Our strategic objective in Iraq is an Iraq that’s stable and an Iraq that will act as an ally of the United States in the ongoing Islamic terrorist effort war against us.
. . .
Everything that I can see, information that I can get, tells me that our military, including General Petraeus, thinks that there’s still a chance we can achieve that objective. As long as there’s still a chance that we can achieve that objective, we should support it, Democrats and Republicans.
. . .
MR. RUSSERT: …as of now you’re, you’re prepared to spending more–several more years if necessary.
MR. GIULIANI: For now–I, I don’t think you put it–when has any country ever won a war with great pressure for time limits placed on the military while you are engaged in that war? I think there’s been a counterproductive thing done here that–if we had gone into any war with, you know, “You’ve got a year to do this, you got two years to do this, otherwise we’re going to give the enemy a timetable of our retreat,” you almost can’t succeed in that war. The enemy even figures out you can’t succeed, and they outlast you.

Regarding energy security:

MR. RUSSERT: Congress–the House has passed an energy bill which would mandate 35 miles per gallon per automobiles by the year 2020. Would you support that?
MR. GIULIANI: That isn’t the way I think it should be done. I think what we should be doing is developing the alternatives so it’s possible to accomplish that as opposed to just setting mandates and not having the support there for expansion of hybrid vehicles, expansion of biofuels, including ethanol. Expansion…
MR. RUSSERT: But you’re against increasing miles per gallon.
MR. GIULIANI: I would not do it that way, yes. I would do it with heavy expansion of hybrid vehicles, which move some of the sources over to electricity, then deal with clean coal, nuclear power, hybrid vehicles, expansion of hydroelectric power, more oil refineries, more domestic oil. All of those things are the things that we should be supporting. And we should be selling that to the, to the rest of the world, because if, if–no matter what we do, if China and India and these other countries that are developing don’t start to get control on this, it’s going to wipe out any good that we do. So the real emphasis here should be on developing energy independence and creating these alternative industries.

Contrast what Giuliani is asking of Americans. On one hand, if you are a member of the armed forces you can expect to continue risking life and limb near the oilfields in Iraq. Giuliani offers no finality to that war–we’re there as long as there’s “a chance” that things might turn out well.
On the other hand, if you don’t have connections to the military, then nothing is asked of you. Heaven forbid that we even require SUVs to have a few less horsepower or cubic feet of cargo space. That wouldn’t be good for business!
I suppose it’s just a coincidence that Giuliani’s law firm and campaign have strong financial ties to the energy industry. I can’t think of anyone who would benefit from a continued U.S. military presence in the Middle East + high American demand for oil, can you?
Meanwhile, “IEA exec says oil supply crunch looms.”