Miami Institute Johnson/Gonzalez Lab

Oil Neg

Oil Neg
Oil Neg............................................................................................................................................................................1 Backstopping 1NC..........................................................................................................................................................2 Backstopping 1NC..........................................................................................................................................................3 No Flooding Now............................................................................................................................................................4 Link- Flood.....................................................................................................................................................................6 Spare Capacity- Yes........................................................................................................................................................7 Spare Capacity- Yes........................................................................................................................................................8 Spare Capacity- Yes........................................................................................................................................................9 Spare Capacity- Yes......................................................................................................................................................10 Spare Capacity- Yes.......................................................................................................................................................11 Spare Capacity- Yes .....................................................................................................................................................12 Spare Capacity- Yes .....................................................................................................................................................13 Spare Capacity- Yes......................................................................................................................................................14 Yes Refinery Capacity...................................................................................................................................................15 Transportation Capacity................................................................................................................................................16 Transportation Capacity................................................................................................................................................17 Transition Now..............................................................................................................................................................18 Transition Now..............................................................................................................................................................19 Transition Now..............................................................................................................................................................20 2NC Oil Link................................................................................................................................................................21 A2: OPEC Irrelevant ....................................................................................................................................................22 A2: No Price Collapse...................................................................................................................................................23 A2: Peak Oil..................................................................................................................................................................24 A2: Peak Oil..................................................................................................................................................................25 A2: Peak Oil..................................................................................................................................................................26 A2: Peak........................................................................................................................................................................27 A2: Peak Oil..................................................................................................................................................................28 A2: Peak Oil.................................................................................................................................................................29 A2 – ME Destabiliziation.............................................................................................................................................30 A2: Supply-Demand Key..............................................................................................................................................31 A2 – Supply/Demand Key............................................................................................................................................32 A2: Hubbert’s Peak.......................................................................................................................................................34 Abiotic Oil.....................................................................................................................................................................35 Abiotic Oil....................................................................................................................................................................36 A2: Dependence Adv.....................................................................................................................................................37 A2: Price Spikes............................................................................................................................................................38 A2: Price Spikes............................................................................................................................................................39 A2: Price Spikes............................................................................................................................................................40 A2: Price Spikes............................................................................................................................................................41 Transition Solves...........................................................................................................................................................42 Transition Solves...........................................................................................................................................................43

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Backstopping 1NC
A. Uniqueness and impact- status quo ensures transition solving Aff
Agence France Presse -- English June 4, 2008 p. l/n Claude Roy, an interministerial official who is coordinating France's efforts in biofuels, said "the real outcome lies in the battle of the yields," a reference to the amount of fuel that is harvested compared to the energy used to produce it. "At present, the two techniques have low energy yields. We have to double present yields to make them viable. Tripling them would be ideal," said Roy. Such improvements can only come through research and development and economies of scale in manufacturing -- and those in turn can only come through massive investment. For instance, the German firm Choren Industries is to build a biofuel refinery with a 200,000-tonne capacity. The cost is a billion euros (1.55 billion dollars), compared with just 40 million euros (62 million dollars) for a similar facility handling rapeseed, also called colza. Such investments are fine -- just so long as oil prices hold up. In many minds are memories of a false dawn 30 years ago. Investment in renewable energies surged in the late 1970s but was wrecked when, a few years later, the price of crude plummeted and oil climbed back into the saddle.

B.1. Link- Seeing threats causes OPEC to flood the market
Alexander, Editor of Gas and Oil Connections, 4/17/03, p. http://www.gasandoil.com/goc/news/ntm31691.htm (Alexander, “How OPEC keeps America hooked on oil imports”, Alexander’s Gas and Oil Connections) Many Americans dumped gas guzzlers for smaller cars. President Reagan ended oil-price controls, setting off a boom in domestic drilling and arresting, through the mid-1980s, the downward spiral in US oil output. Prices hit $ 40 a barrel in 1979 -- $ 100 a barrel at today's prices, after accounting for inflation -- and were expected to double during subsequent years. Saudi Arabia worried that high prices would backfire. And to reduce US imports, President Carter championed an $ 88 bn plan to develop synthetic oil from abundant US reserves of coal and shale. So Saudi Arabia started selling oil at prices several dollars a barrel lower than the OPEC $ 34-a-barrel standard. Then, in 1985, as the cartel was facing increasing competition from Alaskan and North Sea oil fields, Saudi Arabia and Kuwait engineered a price crash. After a meeting in which OPEC decided to go after market share rather than prop up prices, Sheik Yamani, the Saudi oil minister, said to several reporters: Let's see how the North Sea can produce oil when prices are at $ 5 a barrel. At low prices, the Persian Gulf countries have an unbeatable edge. In the mid1980s, it cost them a couple of dollars a barrel to produce oil. It cost about $ 15 to produce a barrel off the coast of Britain and Norway or in the US.

2. Spare capacity exists in the system now
Emirates News Agency June 25, 2008 p. l/n Energy minister, Mohammed bin Dha'en Al Hamili has reiterated the commitment of the UAE and other oil producing countries to supply enough oil at a reasonable prices to contribute to the efforts to ensure global economic growth. Al Hamli made the statement in his address to the Asian Oil and Gas Show, which opens Wednesday here at the COEX Convention Centre. "We are aware of the importance of reliable stable supplies at reasonable prices to growing economies in regions such as Asia. Producers and consumers are both in need of stability," Al Hamli said in his address. He said the UAE and other OPEC countries had, over the past few years, invested heavily to ensure maximum production of oil reserve for use in case there was a hitch in production as a result of emergency circumstances. "we have invested heavily to ensure that there is sufficient spare capacity to replace the occasional unexpected cessation of supplies caused by the weather, geopolitical tensions or the occasional accident. That spare capacity exists but financial speculators many of whom have never seen an oil tanker or a refinery continue to drive prices up as they hedge against inflation, the weakening US Dollar and seek new opportunities for quick returns in commodity markets," he stated.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Backstopping 1NC

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

No Flooding Now
OPEC won’t add more oil to the market now
Cohen, researcher at Peak Oil Association, April 30 2008 (Dave, http://www.aspo-usa.com/index.php?option=com_content&task=view&id=363&Itemid=91) The time has come to discuss what we can expect from OPEC as it relates to our prosperity in the coming decade. After 2010, crude produced outside the cartel will plateau and gradually decline, so any growth in the conventional oil supply must come from OPEC. OECD policy-makers and consumers must now understand that OPEC's short term policy on supply-side relief, which is not to provide any, is also their longer term policy. Do not count on OPEC to bail us out of the oil crunch. We must adjust our expectations to reflect reality, not our hopes and dreams.

OPEC controls now- they dominate the market
Cohen, researcher at Peak Oil Association, April 30 2008 (Dave, http://www.aspo-usa.com/index.php?option=com_content&task=view&id=363&Itemid=91) Delusional expectations placed upon OPEC's ability and willingness to expand the oil supply are going to make our lives untenable within a few short years. Harmful price impacts are already happening now. For most citizens, future impacts will far outweigh questions about who the next president of the United States will be as things stand now. In the absence of a major and immediate policy shift in the United States that aims to substantially reduce our oil consumption, it will be OPEC, not our elected government or "Big Oil" companies, that sets the minimum (floor) prices for liquid fuels.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Link- Flood
Empirically Proven: OPEC Manipulates Oil Markets To Only Their Benefit
Alexander, Editor of Gas and Oil Connections, 4/17/03, p. http://www.gasandoil.com/goc/news/ntm31691.htm (Alexander, “How OPEC keeps America hooked on oil imports”, Alexander’s Gas and Oil Connections) President Carter's synthetic-fuel program couldn't compete with the new OPEC prices and was ridiculed for its massive, money-losing projects. The US is far more energy-efficient than it was in 1973, when Arab nations cut off oil exports to the US because of America's support for Israel during the October war. It takes about half as many barrels of oil to produce each $ 1 of economic output today as it did 30 years ago, according to Cambridge Energy Research Associates, a consulting firm. But most of the gains in fuel efficiency came in the early 1980s when oil prices were high. Electric utilities and other large customers switched to natural gas, which was seen as a cheaper and cleaner alternative, and less vulnerable to disruption because it was produced in the US and Canada. In 1979, 13.5 % of electricity was produced by oil; that figure dropped to 4.1 % in 1985 and about 3 % today. Home heating went through a similar transformation, from oil to natural gas. When oil prices declined after 1985, the pace of energy efficiency slowed. The US became somewhat less dependent on oil mostly because of long-term changes in the structure of the economy, not because of energy-saving technology. Nine energy-intensive industries -aluminium, agriculture, chemicals, forest products, glass, metal casting, mining, steel and petroleum -- account for 80 % of industrial energy use. Many of those industries are in decline. Newer ascendant ones, such as software and communications, don't use as much energy. Petroleum accounts for 40 % of total US energy consumption, down from 50 % in 1973. In the 1990s, gasoline prices fell lower than they had been since the oil embargo of 1973, taking inflation into account. OPEC was determined to keep prices relatively low to retain market share and scare off rigs in other regions. The American government didn't require further increases in automobile fuel efficiency. With the economy surging, consumers flocked to minivans, SUVs and other fuel hogs. To lessen dependence on oil, economists say, the US would have to raise the price of gasoline substantially. It would take an additional $ 1-pergallon tax, on top of the average current tax of 41 cents, to reduce gasoline consumption by about one-fourth, according to Congressional Budget Office estimates. Europe and Japan have especially high gas taxes -- $ 3.16 a gallon in Britain; $ 1.75 in Japan -- so drivers there overwhelmingly choose smaller, fuel-efficient vehicles. "To reduce oil consumption, the most obvious thing to do is to tax gasoline and make fuel economy a desirable feature," says Loren Beard, a senior manager for energy planning at DaimlerChrysler in Detroit.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
Saudi Arabia increasing spare capacity
7.62mm Justice June 23, 2008 p. l/n Jun. 23, 2008 (7.62mm Justice delivered by Newstex) -- BUSINESS & ECONOMY Oil, oil, oil As oil prices continue their climb to new heights, the only remaining OPEC country able to increase production is feeling political and economic pressure to do so-although not in the way expected by Congress. Saudi Arabia will add another 500,000 barrels of daily output to raise its production to the kingdom's highest level in 25 years, in an attempt to allay unrest and to continue its client countries' economic growth so they will continue to purchase additional oil.

Saudis can produce more- they just don’t wanna
Korin, codirector for the institute of Global studies, May 22 2008 p. lexis (Anne, Congressional Testimony) OPEC, spearheaded by Saudi Arabia, is deliberately keeping oil supply tight to prop up prices. Not only is Saudi production lower today than it was two years ago, despite the increase in demand, but the cartel has effectively deleted 2.4mbd from the global oil market in what amounts to an accounting scam. In 2007, OPEC expanded its member roster to include Ecuador and Angola - together the two had accounted for nearly 2.4mbd of non-OPEC oil. Yet, total OPEC production remained constant, allowing existing members to reduce production. This translates into a net reduction in non-OPEC supply with no equivalent increase in OPEC supply. This is equivalent to the production of Norway disappearing off the market . Further, while non-OPEC production has doubled over the last thirty years, as the graph below shows, OPEC production today is virtually identical to its production thirty years ago, even as the global economy has grown and with it demand for oil.

Saudi production has increased- reserves exist
Middle East Select July 1, 2008 p. l/n Saudi Arabia has described the oil price as unjustifiably high. With demand growth slowing and more Saudi crude about to come to market, is a remedy at hand? King Abdullah bin Abdelaziz al-Saud finds himself like a latterday King Canute, vainly commanding the surging tide of oil prices to recede. The Saudi government has now put on record its view that it is resolved to prevent oil prices from rising 'in an unjustified and abnormal manner', and it has called for a meeting of major oil producers and consumers in Jeddah on June 22nd to try to devise means to stabilise prices at a level that would satisfy the interests of both parties. Saudi Arabia has also let it be known that it has made an effort to address the problem by increasing its own production, while insisting that prices are being pushed ever upwards by forces beyond the control of even the world's largest oil exporter.

Supply glut possible- that oil exists and demand will decrease
Middle East Select July 1, 2008 p. l/n At the same as it is seeking to reassure consumers, Saudi Arabia also has to reckon with the concerns of some of its fellow OPEC member states about the risks of a supply glut. The changes in the IEA's demand forecasts are suggestive of a trend that might turn out to be much more severe than they seem at present. By the time OPEC ministers next convene--they have a meeting scheduled for September, but that could be brought forward--the demand outlook may well look even bleaker. Taking into account inflation and the dollar's depreciation it can be assumed that OPEC "comfort" level is somewhere between $80US-100/b. The challenge for Saudi Arabia is to nudge the price into that zone with the minimum disruption.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
Saudi Arabia expanding operation- spare capacity will be A-Go
Africa News June 26, 2008 p. l/n Participants agreed that restoring oil market stability requires concerted moves to implement a broad set of policy measures, including increased oil investment, strengthened pass-through of price signals to end-users, and improved oil market data. The Saudi Arabian government announced at the meeting that the country stood ready to increase oil production beyond the 0.5 million barrels a day (mbd) rise already planned for July for the remainder of the year. Its oil production capacity will reach 12.5 mbd by end-2009, with ready plans for further expansion to 15 mbd if warranted by demand developments.

Kuwait has spare capacity
Birmingham Post June 25, 2008 p. l/n Oil cartel Opec insists supplies are ample and blame the rise on speculators, although top exporter Saudi Arabia announced over the weekend at a meeting between producers and consumers it would hike output in an attempt to cool markets. Kuwait, another one of the few Opec members with spare capacity, plans to increase its oil output by 300,000 barrels per day starting mid-2009, state news agency KUNA reported.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
OPEC’s Spare Capacity Is on the Rise
Petroleum Intelligence Weekly, 9/3/07, p. http://www.energyintel.com/DocumentDetail.asp?document_id=210901 (“OPEC Spare Capacity Keeps On Rising”, Energy Intelligence Group) One key barometer of potential turbulence in oil markets is Opec's spare crude oil production capacity. As with hurricanes, low readings point to stormy weather ahead. But Opec spare capacity is on the rise, suggesting at least a lull in the price squalls that have beset the market over the past few years. There are still serious issues surrounding the measurement and adequacy of spare capacity -- the degree of geopolitical risk and the location and quality of the available Opec spare, along with the levels of global commercial and strategic stocks, continue to interact in a complicated dance. But a few trends seem to be firmly in place. Firstly, Opec production cuts over the last year have created a 1 million-1.5 million barrel per day cushion of current spare capacity -- with, importantly, a large component of lighter crudes. Secondly, growth in the "other liquids" category, for both Opec and non-Opec, is compensating for slowing non-Opec growth. And lastly, new Opec light crude production is being brought on stream to bolster spare capacity even further. The call on Opec crude next year is projected by PIW sister publication Oil Market Intelligence to be 29.4 million barrels per day, down from a 30.1 million b/d average expected for 2007. Current Opec spare capacity is rated by OMI at nearly 4.4 million b/d at end-July, excluding Iraq and Angola, which are not included in the production cut system (PIW Aug.20,p2). By year end, reliable spare capacity, excluding those Nigerian volumes shut in due to civil unrest and sabotage, could grow to over 4.5 million b/d with the completion of Saudi Arabia's three-field Greater Khursaniyah Area (GKA) project along its northeast coast (PIW Aug.13,p5). Besides the 500,000 b/d addition to Arab Light crude capacity, the kingdom will also gain a combined 600,000 b/d of natural gas liquids (NGLs) capacity from both GKA and an expansion of the giant Ghawar field's Hawiyah liquids processing center. Smaller contributions are slated to come from Qatar -- 80,000 b/d of condensate and NGLs from the fifth RasGas LNG train and 65,000 b/d of additional capacity from the Idd al-Sharqi field -- and Libya, from a 40,000 b/d capacity expansion at the Al-Jurf field. Although spare capacity is expected to climb above 5 million b/d during 2008, it will still be well below the 7 million b/d peak seen in early 2002, and will decline again after the end of next year.

There is Spare Capacity of Oil in Kuwait
Reuters, 6/25/08, p. http://economictimes.indiatimes.com/News/International_Business/Kuwait_says_plans_300000_bpd_oil_capacity_b oost/articleshow/3163167.cms (“Kuwait says plans 300,000 bpd oil capacity boost”, Reuters) Kuwait plans to raise its oil output capacity by 300,000 barrels per day by mid-2009, Oil Minister Mohammad alOlaim said on Wednesday, clarifying a report by the official news agency KUNA. "Yes, capacity," Olaim told reporters when asked about the KUNA report that cited him as saying the OPEC exporter planned an output increase of 300,000 bpd in a year. Olaim declined to comment on the Gulf state's spare capacity levels. The Gulf Arab state is one of few members of the Organization of the Petroleum Exporting Countries capable of raising output. Kuwait produced 2.58 million barrels per day in May, according to a media survey, compared with 2.59 million in April. The world's seventh-largest oil exporter, which sits on a tenth of global crude reserves, plans to boost output to 4 million bpd by 2020.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
Many Countries Asked for Oil Prices to Drop But OPEC Countries Have Not Complied
Lewis, Staff Reporter, 6/22/08, p. http://www.boston.com/news/world/middleeast/articles/2008/06/22/opec_nations_consider_increase_in_oil_product ion/ (Barbara, “OPEC nations consider increase in oil production”, The Boston Globe) The two other OPEC members with some extra capacity are the United Arab Emirates and Kuwait. Another OPEC delegate said it was not yet clear whether they would join in any output rise. Mohammad al-Olaim, Kuwait's oil minister, said he had no plans to raise output ahead of the talks, but would consider options afterward. While consumer nations have said an increase in OPEC output would help to calm runaway oil markets, OPEC member countries have repeatedly blamed factors that include speculation, a weak dollar and political instability. Libya's top oil official, Shokri Ghanem, said the market had more than enough crude. "There's oversupply in the market. We believe the prices are high, but it's not because of supply and demand," he said, adding he did not expect concrete actions at today's meeting. Today's meeting also is expected to look at whether speculation is responsible for current price levels and what can be done about it. "Governments have a role in organizing [oil] markets and structuring them in a way that prevents speculators behaving in a manner that has led oil prices to reach their current levels," Prince Abdulaziz bin Salman, deputy Saudi oil minister, was quoted as saying by the Saudi-owned daily Asharq alAwsat. Investment funds have pumped billions of dollars into oil and other commodities as they seek to diversify holdings and flee poorly performing asset classes. Under pressure from US lawmakers, the Commodity Futures Trading Commission, which oversees futures trading on US exchanges, announced a task force to explore commodity activity. It also reached a deal with its British counterpart to limit trading on oil futures on the Londonregulated ICE exchange. While Riyadh wants action from the governments of consumer nations to rein in speculators, Western leaders, including President Bush, have lobbied heavily for more Middle Eastern crude. King Abdullah of Saudi Arabia will open the meeting today, followed by an address by Prime Minister Gordon Brown of Britain, the highest-level foreign dignitary to attend. Demand for fuel from China, India, and the Middle East has jumped in recent years along with rapid economic growth in those countries. The increased demand in the developing world has coincided with historically low levels of spare oil production capacity, which fell below 2 million barrels per day among OPEC countries in May for the first time since the third quarter of 2006, according to the International Energy Agency.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
OPEC’s Spare Capacity Is on the Rise
Petroleum Intelligence Weekly, 9/3/07, p. http://www.energyintel.com/DocumentDetail.asp?document_id=210901 (“OPEC Spare Capacity Keeps On Rising”, Energy Intelligence Group) One key barometer of potential turbulence in oil markets is Opec's spare crude oil production capacity. As with hurricanes, low readings point to stormy weather ahead. But Opec spare capacity is on the rise, suggesting at least a lull in the price squalls that have beset the market over the past few years. There are still serious issues surrounding the measurement and adequacy of spare capacity -- the degree of geopolitical risk and the location and quality of the available Opec spare, along with the levels of global commercial and strategic stocks, continue to interact in a complicated dance. But a few trends seem to be firmly in place. Firstly, Opec production cuts over the last year have created a 1 million-1.5 million barrel per day cushion of current spare capacity -- with, importantly, a large component of lighter crudes. Secondly, growth in the "other liquids" category, for both Opec and non-Opec, is compensating for slowing non-Opec growth. And lastly, new Opec light crude production is being brought on stream to bolster spare capacity even further. The call on Opec crude next year is projected by PIW sister publication Oil Market Intelligence to be 29.4 million barrels per day, down from a 30.1 million b/d average expected for 2007. Current Opec spare capacity is rated by OMI at nearly 4.4 million b/d at end-July, excluding Iraq and Angola, which are not included in the production cut system (PIW Aug.20,p2). By year end, reliable spare capacity, excluding those Nigerian volumes shut in due to civil unrest and sabotage, could grow to over 4.5 million b/d with the completion of Saudi Arabia's three-field Greater Khursaniyah Area (GKA) project along its northeast coast (PIW Aug.13,p5). Besides the 500,000 b/d addition to Arab Light crude capacity, the kingdom will also gain a combined 600,000 b/d of natural gas liquids (NGLs) capacity from both GKA and an expansion of the giant Ghawar field's Hawiyah liquids processing center. Smaller contributions are slated to come from Qatar -- 80,000 b/d of condensate and NGLs from the fifth RasGas LNG train and 65,000 b/d of additional capacity from the Idd al-Sharqi field -- and Libya, from a 40,000 b/d capacity expansion at the Al-Jurf field. Although spare capacity is expected to climb above 5 million b/d during 2008, it will still be well below the 7 million b/d peak seen in early 2002, and will decline again after the end of next year.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
OPEC Countries Have Ability to Produce More than Projected
Sodhi, an Economist at the Centre for Independent Studies, 6/24/08, p. http://www.cis.org.au/executive_highlights/EH2008/eh63608.html (Gauray, “The Myth of OPEC”, Executive Highlights) But it is actually just a loose alliance of 12 diverse oil producing countries that tries to influence prices by controlling output. It does this by allocating each member country a quota for production. This means that all 12 members are told to produce at lower levels than they otherwise would to keep prices high. The problem with this is that no one can check whether individual countries are sticking to their quotas. And since no individual country has the reserves to influence global prices- with the possible exception of Saudi Arabia- every member knows that it can quietly produce more than its quota without facing lower prices. So every member faces the same incentive to ‘cheat’ the cartel. Of course, if all members pump out more than the quota, the price starts to fall and the cartel falls apart. This has been the pattern of behaviour not just of OPEC in the past, but of all cartels. Because the incentive to cheat by individual members is so strong and the ability of the cartel to enforce compliance so weak, cartels have historically produced more than they say they do.

12

Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
OPEC Countries Have Ability to Produce More than Projected
Sodhi, an Economist at the Centre for Independent Studies, 6/24/08, p. http://www.cis.org.au/executive_highlights/EH2008/eh63608.html (Gauray, “The Myth of OPEC”, Executive Highlights) But it is actually just a loose alliance of 12 diverse oil producing countries that tries to influence prices by controlling output. It does this by allocating each member country a quota for production. This means that all 12 members are told to produce at lower levels than they otherwise would to keep prices high. The problem with this is that no one can check whether individual countries are sticking to their quotas. And since no individual country has the reserves to influence global prices- with the possible exception of Saudi Arabia- every member knows that it can quietly produce more than its quota without facing lower prices. So every member faces the same incentive to ‘cheat’ the cartel. Of course, if all members pump out more than the quota, the price starts to fall and the cartel falls apart. This has been the pattern of behaviour not just of OPEC in the past, but of all cartels. Because the incentive to cheat by individual members is so strong and the ability of the cartel to enforce compliance so weak, cartels have historically produced more than they say they do.

Saudi Arabia Has the Most Spare Capacity
Fanney, Former Editor, 5/17/08, p. http://www.associatedcontent.com/article/771441/saudi_arabia_unable_to_produce_more.html?page=2&cat=75 (Robert, “Saudi Arabia Unable to Produce More Oil”, Associated Content) In a visit to the Kingdom of Saudi Arabia this week, President Bush, pressured by Congress and consumers at home, asked the Kingdom to increase oil production. The visit, Bush's second to the Kingdom since January, underscores the increasing need to lower oil prices which have climbed inexorably from around $90 per barrel to nearly $127 per barrel in a four month period. With gasoline prices set to rise to between $4.00 and $4.50 per gallon, the call for lower costs is becoming more and more shrill with each passing day. The Kingdom's answer to Bush's call for oil was as clear as it was chilling. According to news reports from the Washington Post and Associated Press, Saudi leaders responded by telling Bush they are doing all they can to produce more oil. Pledging to raise output by 300,000 barrels per day in June, was the best the Kingdom could do to help an increasingly strained world oil supply. With the largest stated spare capacity in the world, and the only country currently not pumping oil at full capacity, the Kingdom of Saudi Arabia is the last hope for adding significant supplies of oil to market and reducing cost. That said, there have been a number of signs in recent years that the Kingdom has struggled to maintain, much less increase, production. Over the past two years, output from Saudi Arabia has wavered between 8.5 and 9.5 million barrels per day. Though the Kingdom claims about 2 million barrels per day of spare capacity, most of this oil is in the form of very heavy crude that is difficult to refine into usable grades. Over the past year, a number of calls have been made to the Kingdom to ramp up production in the face of record prices. The Kingdom has responded by posting a number of confusing and contradictory explanations. First it blamed speculators for the high price of oil. Then it claimed supply and demand were in balance, despite record prices worldwide. Lastly, it joined a large group blaming high oil prices on the falling dollar. Now, it is simply stating that it cannot produce a significant volume of new oil. Out of all these statements, only the last has in it a glimmer of truth. National Security Adviser Stephen J. Hadley provided a little more light by telling reporters "I think the message the Saudis were sending was, we're doing everything we can to meet this problem, but it's a complicated problem and the underlying causes of these high gas prices are going to take time and money to address." Underlying causes include a current inability to increase production and with the Kingdom already investing billions in attempts to squeeze more oil out of its older wells, it seems increasingly in doubt that the Saudis will succeed in their goals. This year alone, over 1.5 million barrels per day in new production was supposed to be brought online from Saudi fields. But these new projects are aimed at old wells and, so far, have met with disappointing results. As time ticks by and Saudi Arabia continues to fail to meet its production goals, it becomes increasingly obvious that both the Saudis and the world are in for serious trouble. If the Saudis cannot increase production substantially and with 54 of the world's 65 major oil producing countries in decline, the moment of a world peak in oil production appears to be imminent. The fact that the Saudis are admitting they cannot substantially increase production should be further sign that the wolf of peak oil is now howling at the door.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Spare Capacity- Yes
OPEC Can Decide When Or When Not to Improve the Economy Through Oil Markets
Lewis, Staff Reporter, 6/22/08, p. http://www.boston.com/news/world/middleeast/articles/2008/06/22/opec_nations_consider_increase_in_oil_product ion/ (Barbara, “OPEC nations consider increase in oil production”, The Boston Globe) JEDDAH, Saudi Arabia - Saudi Arabia and other producers with oil to spare could agree to raise output at an emergency meeting of energy powers this weekend, but the Organization of Petroleum Exporting Countries says speculation, not supply, is behind high prices. Riyadh summoned energy producers, consumers, and chief executives from big oil firms to meet today. The oil price has more than doubled in a year to almost $140 a barrel, triggering protests from Brussels to Bangkok over record fuel costs that threaten the world's economy. Saudi Arabia has said it will raise its crude output to 9.7 million barrels per day in July. US Energy Secretary Sam Bodman said yesterday that producers must pump more to ease the pain felt in the United States and elsewhere from record fuel prices. He blamed tight supplies for the price surge. "Anything that will add supply to the market is important," Bodman said. "While increases in near term oil production are welcome and necessary, fundamentally the market needs to see investment in increasing the longer term production capability," he added. Saudi Arabia, the world's biggest oil exporter, has a policy of keeping a cushion of spare capacity and has said other OPEC members that can bring on extra production quickly would also discuss boosting output to try to tame the oil rally. "The short-term policies to be discussed include the proposal that those OPEC countries that have spare capacity should boost supply, just like Saudi Arabia has announced it will do in July," a senior OPEC official said. Looking to the longer term, the source also said Saudi Arabia would consider increasing its capacity beyond an existing goal of 12.5 million barrels per day by the end of next year.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Yes Refinery Capacity
85% of Refineries Have Free Capacity
Polley, Professor at West IL University, 5/5/08, p. http://www.williampolley.com/blog/archives/2008/05/refinery_capaci.html (William, “Refinery capacity utilization”, EIA,) The most recent data point on refinery capacity from the EIA was 85% in February. Unless things have ramped up immensely in a way that hasn't been seen for years (which due to the higher than average inventories, I doubt is the case), then I am a little bit skeptical of claims that the supplies, even in the short run, are "fixed". (Get this data and more from the EIA.) From the summer of 2006 to the summer of 2007, inputs of crude oil into the refineries went down, operable capacity went up, and idle capacity went up. If capacity utilization were on the level it was in 2000, I'd be more inclined to see the supplies as fixed. Any extra capacity would suggest that the consumers would get some benefit from the tax holiday. But again, let me be very clear... the amount that the consumer would benefit would be a small fraction of the tax reduction--5 or 6 cents out of the 18.4 would be as high as I would be comfortable in guessing. Maybe more like 3 or 4 cents. That's just not enough to justify temporarily tinkering with the tax code to win political points. It's bad public policy. If you want to provide relief to working families, fine. There are a dozen better ways.

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Miami Institute Johnson/Gonzalez Lab

Oil Neg

Transportation Capacity
Russian Oil Pipeline Transport Is Increasing
Global Insight, 5/8/08, p. http://www.globalinsight.com/SDA/SDADetail12462.htm (“Russia, Kazakhstan Agree to Double CPC Oil Pipeline Capacity by 2012”, Global Insight) Russia's Industry and Energy Ministry today confirmed that it has reached a deal with Kazakhstan to double capacity on the Caspian Pipeline Consortium (CPC)'s Tengiz-Novorossiisk oil pipeline, a move that will permit the Central Asian state to increase its crude oil exports. In a statement announced by the Russian Industry and Energy Ministry, Viktor Khristenko said that he and his Kazakh counterpart, Sauat Mynbayev, had reached an agreement on an expansion of capacity on the Tengiz-Novorossiisk oil pipeline. "A joint position has been agreed on the issue of the CPC [Caspian Pipeline Consortium] expansion, which should take place before 2012 in two stages", the statement said. The agreement paves the way for the privately owned CPC pipeline to expand to its design peak capacity of 67 million tonnes per year (1.34 million b/d), up from its current capacity of around 32 million tonnes/year. That is, however,
in theory. In practice, Russia and Kazakhstan—the two largest stakeholders in CPC (see table) and the two countries through whose territories the pipeline runs—have previously "agreed" to expand capacity on the pipeline several times, only for these deals to fall through, for various reasons. The CPC launched the 1,510-km pipeline from the Tengiz oilfield in western Kazakhstan to Russia's Black Sea port of Novorossiisk in October 2001, opening up the first direct oil export route to world markets for Kazakh oil. At the time, capacity on the pipeline was 28 million t/y (565,000 b/d), but throughput volumes quickly reached initial capacity, triggering discussions on an early expansion on capacity for the route. However, until now, Russia has repeatedly blocked an early expansion of the pipeline, standing alone among CPC shareholders in arguing for higher transit tariffs, a restructuring of the consortium's debt from construction of the multi-billiondollar pipeline, and, later, pushing for Kazakhstan to commit to supporting Russia's own preferred "Bosphorus bypass" pipeline, the Burgas-Alexandroupolis pipeline from Bulgaria to Greece, as the exit route for Kazakh oil exports heading west to the Mediterranean market (see "Related Articles"). Several times in recent years, Kazakhstan believed it had met Russia's conditions for an expansion of the pipeline, and the other CPC shareholders consented to higher transit tariffs, only for Russia to renege on an agreement. Kazakh President Nursultan Nazarbayev, having agreed to support the Russian-sponsored Burgas-Alexandroupolis route, even came away from a meeting with Russia's then-president Vladimir Putin announcing that a deal had been reached to expand the CPC's capacity, only for Russia to drag its feet again. In the meantime, however, Kazakhstan has been moving slowly towards further diversification of its oil export options, with the launch of exports via the Kazakhstan-China oil pipeline in 2005, and progress (albeit slow) towards starting trans-Caspian oil exports for re-export via the Baku-Tbilisi-Ceyhan (BTC) pipeline. The CPC itself has pushed the Tengiz-Novorossiisk pipeline to its limits, expanding capacity through the use of drag agents and pumping an average of 655,000 b/d in 2007, up 4.8% year-on-year. Nevertheless, with Tengizchevroil (the Chevron-led consortium developing the Tengiz field) having launched an expansion at the field earlier this year that is expected to double output to 540,000 b/d by the end of the year, Kazakhstan is in need of additional oil export options to handle the anticipated rise in volumes. Outlook and Implications With initial oil production from

the Central Asian state is keen to move forward with ensuring that the infrastructure is in place to handle its anticipated increase in oil exports. China has already begun work on the third and final phase of the Kazakhstan-China pipeline, which will link two existing pipelines in central Kazakhstan, thereby allowing Kazakh oil from the Caspian region (including from Tengiz) to flow across Kazakhstan to China. The expected completion of this leg, perhaps by next year, will provide an additional export option for Tengiz volumes, as will the start of a Kazakhstan-Azerbaijan oil supply agreement that would see oil from western Kazakhstan shipped by barge across the Caspian for reloading via the BTC. The progress on these alternative oil export options for Kazakhstan, together with the fact that CPC shareholders have already agreed to all of Russia's demands, seems to have finally convinced Russia to stop stalling and permit CPC to begin the long-awaited capacity expansion. The pipeline's shareholders had agreed to restructure the consortium's debt and go along with an increase in the transit tariff in September of last year, and in December Russia said it had dropped its opposition to an expansion of the pipeline, yet it has still taken until now to finally secure an agreement on a plan to double the pipeline's capacity. Considering the slow progress in reaching an agreement—and the numerous times in which an "agreement" has proven only a false promise—Chevron and the other CPC shareholders will be hoping that this time Russia lives up to its end of the deal.
Kazakhstan's Kashagan oilfield now slated to come onstream in 2011,

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Transportation Capacity
OPEC Shipments are Projected to Fall
Dow Jones Newswire, 6/19.08, p. http://peakoiljournal.com/topic/opec-exports-to-fall-back-in-july-oil-movements5305.html () OPEC crude oil shipments are projected to fall by 230,000 barrels a day in the four-week period to July 5, U.K.based tanker tracker Oil Movements said Thursday. Shipments from members of the Organization of Petroleum Exporting Countries are expected to total 24.59 million barrels a day in the four-week period, down from 24.82 million barrels a day in the previous four-week period to June 7, Oil Movements said. Shipments from key Middle Eastern OPEC producers are projected to decrease by 350,000 barrels a day to 17.63 million barrels a day. "We were having a couple months of exceptionally strong eastbound sailings," said Roy Mason, head of Oil Movements. "Now they are coming down a little bit and westbound sailings are picking up, but not enough to fill the gap. "But sailings out from the Middle East are still extremely high, because of the strong demand from the east," Mason said. Oil Movements forecasts OPEC exports based on spot and term chartering of crude oil from OPEC member countries, except Angola and Ecuador.

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Transition Now
High oil prices cause shift to alternative energy now
7.62mm Justice June 23, 2008 p. l/n Left unsaid by the Saudis is that current oil prices have rekindled alternative-energy (OOTC:AEGC) efforts, which eventually would destroy their oil market altogether. The major auto manufacturers are well along in their development of hydrogen and electric vehicles, and the cost of producing oil from shale located in the United States is about half the current cost of a barrel of oil. Some projections say that the U.S. has enough oil shale to meet its current needs for the next 400 years. Meanwhile, Exxon Mobil (NYSE:XOM) is unloading its 800 company-owned gas stations in addition to 1,400 dealer-operated locations. While in 2007 American oil companies turned in an 8.3 percent profit (which is seven-tenths of a percent below the average for all U.S. manufacturing), Exxon's divestiture is unlikely to affect oil and gas prices as the largest American oil and gas companies produce only three percent of global oil production and six percent of global refining capacity. Selling marginally unprofitable retail outlets will carry nowhere near the same price impact as drilling for more oil (such as in ANWR, which happens to be located merely 60 miles from the 15 billion barrels of oil already sent by Alaska through the pipeline in Prudhoe Bay). The price of gas even has GOP presidential nominee John McCain reversing his stance on offshore drilling. Both he and President Bush have called on Congress to allow such drilling. (President Bush could start by rescinding his father's executive order reinforcing the offshore drilling ban.) Unfortunately, this is the same Congress controlled by Democrats who are on record calling for the nationalization of oil companies and refineries. First it was Maxine Waters (S-CA), and now it's Maurice Hinchey (S-NY): "We [the government] should own the refineries. Then we can control how much gets out into the market." Speaking of refineries, the first such facility built in the U.S. since the 1970s is in the works in South Dakota. The refinery would process about 400,000 barrels per day of Canadian oil, meeting the combined demands of South Dakota, Iowa and Nebraska. This week's Braying Jackass' award "[O]pening our coastlines to offshore drilling would take at least a decade to produce any oil at all, and the effect on gasoline prices would be negligible at best since America only has three percent of the world's oil. It's another example of short-term political posturing from Washington, not the long-term leadership we need to solve our dependence on oil.

High prices make renewables competitive
The Times & Transcript (New Brunswick) May 30, 2008 p. l/n "Because of the strong uptake so early in the program's infancy, and we're the only province doing this today in the country, government will be at the table if more money is required." He said simply the best way to cut energy costs is to cut energy consumption, and noted that the province's growing portfolio of renewable energy will help control energy costs that are tied to oil prices. "We are still going to continue to push for competitiveness on power rates."

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Transition Now
High prices boost renewable investment
The financial Times 5/28/08 p. l/n In relation to how the IPO could affect the share price of Spanish peer Iberdrola Renovables, analysts believe that if the IPO price is very low, investors might move funds from Iberdrola Renovables to EDP Renovables. At the same time, if the IPO is successful, it could boost the share price of renewable energy companies in other countries. Also, investors are keener to invest in renewable energy companies due to the recent surge in oil prices. However, the average stock market performance of renewable energy companies has been less than strong since the beginning of the year. In the case of Iberdrola Renovables, the share price has gone down by 21.42 per cent so far this year.

Market shifts from oil cause increase in alternative fuels
The International Herald Tribune May 28, 2008 p. l/n Many people in Goteborg remain optimistic about the virtuous link they have created between waste and secure energy supplies. Ola Fredriksson, an engineer at Gryaab, the sewage facility in Goteborg, said that what an average person flushed down the toilet each year created enough biogas to drive 120 kilometers, or 75 miles. ''If the oil price keeps on going up, and people are prepared to pay more for renewable energy, then it will make our company interested in producing more biogas,'' he said. ''We have the capacity.'

High oil causes push for renewables
Wireless News May 21, 2008 p. l/n Hawaiian Electric initiated the Archer Substation project to increase its use of renewable energy and gain experience with photovoltaic development, economics, performance, and operations and maintenance, according to company officials. Additionally, Hoku said that fixed energy pricing for renewable energy is part of Hawaiian Electric's effort to secure renewable energy at costs not tied to oil prices. PV is among renewable technologies not facing fuel costs which may vary from year to year. The utility will have an option to purchase the system from Hoku after five years.

Renewable energy becoming widly popular
MINT May 16, 2008 p. l/n "We are at a stage of exploring various concepts and renewable energy is one of them," said Anurag Behar, managing director of Wipro Infrastructure Engineering Ltd, without disclosing a launch date for the business. The company will be seeking shareholder approval for entering the renewable energy business at its annual general meeting on 16 July. Wipro's entry into the business comes at a time when renewable energy, in particular, has stoked investor interest the world over as oil prices rule at around $120 (Rs5,088) a barrel. "Thin film (a kind of technology that helps harness solar energy) will see large emerging applications and a robust demand (for manufacturing capacity) that is expected to grow 10-fold from 250MW currently to 2GW by 2010 with a market size of $6 billion," Shushmul Maheshwari, chief executive of RNCOS E-Services Pvt. Ltd, a New Delhi-based market research firm, had told Mint in January this year.

Renewable research increasing
Press Democrat May 9, 2008 p. l/n A combination of rising energy demand and the prospect for higher electricity rates is leading a growing number of homeowners and businesses to go solar. "People are making a smart investment decision with their money," Zech said. "More and more solar energy systems are popping up, especially with oil prices so high. People are very focused on renewable energy." Real Goods Solar plans to expand into new markets where competitors have little brand recognition and target other states with financial incentives for installing solar, according to the company's filings with the U.S. Securities and Exchange Commission.

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Transition Now
SQ solves- market best
Smil, economics professor @ the University of Manitoba, 2007 p. http://home.cc.umanitoba.ca/~vsmil/publications_pdf.html These facts, I am sure, will not make the least difference to the devotees of an imminent oil peak whose mantra has been to elevate the timing of an obviously inevitable event to a dreadful watershed of history, and whose insistence has been on pinpointing its largely irrelevant arrival. Irrelevant because once the extraction of conventional liquid oil peaks we will intensify our (already advancing) efforts to produce more non-conventional oil and to use more natural gas and accelerate the production of gas- and coal- and biomass-derived liquids.

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2NC Oil Link
Massive US consumption reduction triggers price collapse and global economic destruction
Roberts, massively published author and columnist, 2005 p. 323 (Paul, The End of Oil)

QuickTimeª and a TIFF (Uncompressed) decompressor are needed to see this picture.

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A2: OPEC Irrelevant
OPEC is Still Here Only Because The Economy’s Demand
Sodhi, an Economist at the Centre for Independent Studies, 6/24/08, p. http://www.cis.org.au/executive_highlights/EH2008/eh63608.html (Gauray, “The Myth of OPEC”, Executive Highlights) Consequently, they don’t usually have a great deal of influence in markets. If cartels are so inherently flawed, why has OPEC managed to survive so long? OPEC hasn’t really been successful as a cartel. In the aftermath of the Asian financial crisis in the late 1990’s oil prices fell close to $10 a barrel and the flaws of the cartel were open for all to see. Those same flaws still exist, but they are better disguised today. Strong demand for energy from the developing world and a faltering US dollar have both contributed to a secular bull market in oil that has absorbed the rampant cheating of OPEC member countries. This is unlikely to be the case during a period of falling prices.

OPEC Will Do What OPEC Wants
Fowlkes, Stock Trader, 2/29/08, p. http://www.bloggingstocks.com/2008/02/29/what-is-opec-to-do/ (Michael, “What is OPEC to do?”, Blogging Stocks) Up until the past few weeks we were getting signals from OPEC that we would be seeing some cuts coming in the near future, but now I believe it to be highly doubtful that any cuts are coming in the next several months. Politically it just would not look right to see the group lower its output will prices are at all-time highs. But then again, OPEC typically does what OPEC wants to do. OPEC has argued that the recent surge in prices has nothing to do with fundamentals. They point to the rising inventories in America as evidence that demand is not up to the levels that would justify opening up the pumps a little more. In fact, they have estimated that demand this year will fall 400,000 barrels a day under that of 2007. So what will OPEC ultimately decide to focus on? Should it look at the current record high prices and look to put some oil into the market? Or can we expect it to pay more attention to the inventory levels in the U.S.? In the end, I think that OPEC will lean more towards cutting back supplies to prevent over saturating the market in the event of a recession down the road, but for now, I wouldn't expect to see any changes coming out of the group. What are your thoughts? Does OPEC need to step in a lift its quotas in order to cool prices down, or should they stand by and let the market figure it out for itself for the time being?

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A2: No Price Collapse
Low dollar is the key factor behind high prices- not supply/demand
Cohen, researcher at Peak Oil Association, April 30 2008 (Dave, http://www.aspo-usa.com/index.php?option=com_content&task=view&id=363&Itemid=91) This week brings news that OPEC president Chakib Khelil "does not rule out oil prices reaching $200 a barrel, even though supply is adequate, because the market is driven by the dollar's slide." [Khelil] added: "The prices are high due to the fact of the recession in the United Sattes and the economic crisis which has touched several countries, a situation which has an effect on the devaluation of the dollar, and therefore each time the dollar falls one percent, the price of the barrel rises by $4, and of course vice versa," he was quoted as saying in brief remarks to journalists on Sunday. He added that: "If this (the dollar) strengthens by 10 percent, it is probable that (oil) prices will fall by 40 percent" [Note — to $71.35/barrel at today's price]

Insert Dollar Will Rebound

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A2: Peak Oil
Peak is foolish- market fixes problems and landing soft
Smil, economics professor @ the University of Manitoba, 2007 p. http://home.cc.umanitoba.ca/~vsmil/publications_pdf.html Peter Odell, one of the most astute, life-long observers of global oil scene, calls them "peak-oilers." Some of them were quite unhappy when I pointed out (in Energy at the Crossroads, in these pages, and in Worldwatch in January 2006) their propensity for wholesaling catastrophic scenarios of the world once the global oil production peaks and begins to decline. But how else can one label such writings as Richard C. Duncan's "Olduvai theory" according to which the declining oil extraction will plunge humanity into life comparable to that experienced by some of the first primitive hominids who inhabited that famous Kenyan gorge some 2.5 million years ago? And no one else can be blamed for the repeated failure of their forecasts but the prominent peak-oilers themselves. According to Colin Campbell the global oil extraction was to peak in 1989; Ivanhoe's peak was in 2000; Deffeyes set it first in 2003 and then, with ridiculous accuracy, on the Thanksgiving of 2005. Well, the numbers for 2006 are in. And they show that even after OPEC once again cut its production (by 1.2 million barrels a day effective November 1, 2006) in order to arrest yet another rapid fall in prices, the global oil supply for the entire year rose once again, by about 0.85 million barrels a day. That is about 42 million metric tons a year, or more than the annual output of Oman or nearly twice the annual extraction in Azerbaijan, a major oil power on the Caspian Sea. But once we take into account the need to replace worldwide reserve depletion (currently amounting to more than one million barrels a day) this means that some 2 million barrels of new oil found their way on the global market, an equivalent of adding a bit more than UK's entire North Sea production or Iraq's annual extraction. This supply had fully covered the global demand even with OPEC's production cuts and with China's record imports of oil bought in order to start filling the country's new massive strategic oil reserve. The average price of OPEC's basket of exported crude oils dropped from the peak of about $70/barrel in July to $55/barrel by the end of the year. And then it slid below $50/barrel in January 2007. In 2006 non-OPEC production rose strongly in the countries of the former Soviet Union, surpassing the level of 12 million barrels a day for the first time since the collapse of the USSR and coming within 5 percent of the record annual production reached in 1987 So much for the rumored inability of Russia to maintain its production, and for the "disappointing" results in Azerbaijan and Kazakhstan.

Peak is really stupid
Smil, economics professor @ the University of Manitoba, 2007 p. http://home.cc.umanitoba.ca/~vsmil/publications_pdf.html If one is to believe the catastrophic prophecies of Matthew Simmons, another prominent peak-oiler, this must be the stupidest business decision of the 21st century. Simmons claims that Saudis have falsified their oil reserve data so much that in reality they have only a fraction of the claimed oil left in the ground, and that their, and the world's, largest oilfield, al-Ghawar, has been so damaged by waterflooding (used for enhanced recovery of oil) that it faces imminent and massive extraction downturn. And yet Saudis will be investing nearly $50 billion between 2007 and 2011 to get this nonexistent oil to the global market. Perhaps they know something that Simmons is not aware of (these days it is, after all, de rigueur to say only bad things about Saudis). And, of course, market forces eventually assert themselves as prices rise. In 2006 oil demand was down in all of the leading importing affluent countries (US, EU and Japan) and no dramatic increases are expected this year. Consequently, global oil extraction may be lower in 2007 than it was in 2006, but if such a dip were to take place (China's and India's imports will make it unlikely) it would reflect a reaction to prices, not any physical inability to produce more oil or outright absence of requisite oil reserves in the Earth's crust.

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A2: Peak Oil
Peak Oil is unscientific, unrealistic and fraudulent.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html The view that recent US military adventures in the Middle East and the broader Central Asia are driven by energy considerations is further reinforced by the dubious theory of Peak Oil, which maintains that, having peaked, world oil resources are now dwindling and that, therefore, war power and military strength are key to access or control of the shrinking energy resources. Not only is Peak Oil theory unscientific, unrealistic, and perhaps even fraudulent; war and military force are no longer the necessary or appropriate means to gain access to sources of energy resorting to military measures can, indeed, lead to costly, not cheap, oil. In fact, despite the lucrative spoils of war resulting from high oil prices and profits, Big Oil prefers peace and stability, not war and geopolitical turbulence, in global energy markets. Behind the drive to war and military adventures in the Middle East lie powerful special interests (vested in war, militarism, and geopolitical concerns of Israel) that use oil as an issue of "national interest" as a facade or pretext - in order to justify military adventures to derive high dividends, both economic and geopolitical, from war.

Peak Oil is only a lie spread by people who profit off oil to encourage more drilling.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html There is no hard evidence, however, that oil has peaked, or that global oil reserves are shrinking, or that the current skyrocketing price of oil is due to a supply shortage. (As shown below, there is actually an oil surplus, no shortage.) Peak Oil theory was originally floated around in the 1940s, arguing that world oil reserves would be exhausted within the next two decades or so. It resurfaced in the 1970s and early 1980s in reaction to the oil price hikes of those years, which were, incidentally, precipitated not by oil shortages but by international political convulsions, revolutions and wars. It died down once the price of oil fell back to pre-crises levels. As recent geopolitical convulsions in the Middle East (especially the US war on Iraq, and the resultant booming speculation in oil markets) have triggered a new round of oil price hikes, Peak Oil theory has once again become fashionable. The theory is being promoted not only by war profiteers and proponents of an unbridled domestic oil exploration and extraction, especially in Alaska, but also by some apparently antiwar liberals such as Michael T Klare and James H Kunstler. [3]

The peak oil theory totally ignores new technologies allowing more oil extraction.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html Peak Oil theory is based on a number of assumptions and omissions that make it less than reliable. To begin with, it discounts or disregards the fact that energy-saving technologies have drastically improved (and will continue to further improve) the efficiency of oil consumption. Evidence shows that, for example, "over a period of five years (1994-99), US GDP expanded over 20% while oil usage rose by only 9%. Before the 1973 oil shock, the ratio was about one to one." [4] Second, Peak Oil theory pays scant attention to the drastically enabling new technologies that have made (and will continue to make) possible discovery and extraction of oil reserves that were inaccessible only a short time ago. One of the results of the more efficient means of research and development has been a far higher success rate in finding new oil fields. The success rate has risen in 20 years from less than 70% to over 80%. Computers have helped to reduce the number of dry holes. Horizontal drilling has boosted extraction. Another important development has been deep-water offshore drilling, which the new technologies now permit. Good examples are the North Sea, the Gulf of Mexico, and more recently, the promising offshore oil fields of West Africa. [5]

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A2: Peak Oil
The Peak Oil theory ignores giant oil reserves being developed.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html Third, Peak Oil theory also pays short shrift to what is sometimes called non-conventional oil. These include Canada's giant reserves of extra-heavy bitumen that can be processed to produce conventional oil. Although this was originally considered cost inefficient, experts working in this area now claim that they have brought down the cost from over US$20 a barrel to $8 per barrel. Similar developments are taking place in Venezuela. It is thanks to developments like these that since 1970, world oil reserves have more than doubled, despite the extraction of hundreds of millions of barrels. [6]

Peak Oil proponents exaggerate impacts of increased oil demands.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html Fifth, proponents of Peak Oil tend to exaggerate the impact of the increased oil demand coming from China and India on both the amount and the price of oil in global markets. The alleged disparity between supply and demand is said to be due to the rapidly growing demand coming from China and India. But that rapid growth in demand is largely offset by a number of counterbalancing factors. These include slower growth in US demand due to its slower economic growth, efficient energy utilization in industrially advanced countries, and increases in oil production by members of the Organization of Petroleum Exporting Countries, Russia, and others.

Peak oil is a lie; Saudi Arabia has pledge to pump another half million barrels a day.
Asher – Writer for DailyTech - 6/19/2008 (Michael, “World oil production continues to rise; outlook good for next decade or more,” DailyTech) http://www.dailytech.com/Despite+Reality+Belief+in+Peak+Oil+Persists/article12119.htm Peak Oil, a theory popular among Chicken Little types, has been much in the news recently. The idea behind it is that future production levels of any consumable resource can be reliably predicted based off a single factor: the size of the known reserves. Once half those reserves have been consumed -- so the theory goes -- production will steadily fall, no matter what. So when world petroleum production dipped slightly in 2006 and again in 2007, this predictably brought the usual Peak-Oil disciples out of the woodwork. The global oil peak -- first predicted for the mid-1990s, and many times since -- was finally upon us, they said. From this moment on, production would steadily fall, culminating in the end of life as we know it. But once again, their crystal ball has failed. Petroleum production for the first quarter of 2008 rose to 74.5M bbl/day -- 1.2M higher than the 2007 average. Those figures don't take into account Saudi Arabia's recent pledge to pump another half-million barrels a day, a promise they've already met by the first 300,000.

Peak oil ignores technological improvements and makes supply independent of price and demand.
Asher – Writer for DailyTech - 6/19/2008 (Michael, “World oil production continues to rise; outlook good for next decade or more,” DailyTech) http://www.dailytech.com/Despite+Reality+Belief+in+Peak+Oil+Persists/article12119.htm How does Peak Oil get things so wrong? First, it ignores technological improvements in oil discovery and production. As science advances, the URR (ultimately recoverable reserves) of existing fields rise in pace. Thanks to advances in water and CO2 injection, many oilfields predicted to have been dry a half-century ago are still pumping strong today. But more importantly, Peak Oil puts the economic cart before the horse, with the notion that supply is independent of both price and demand. So much for Economy 101. Higher demand means higher prices... and higher prices increase supply. There are trillions of barrels in the ground that can't profitably be pumped at $50/bbl. But at $140, the story is different. Existing fields are worked harder, unprofitable fields get opened up, and

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Oil Neg

A2: Peak
Rising oil prices are due to supply and demand, fall of the dollar, and speculation.
Chua – Freelance writer – 2008 (Jasmin Malik, “Do High Petroleum Prices Mean We've Reached 'Peak Oil'?” Fox News) http://www.foxnews.com/story/0,2933,369553,00.html Supply and demand By Fisher's reckoning, rising oil prices are more likely due to an old-fashioned case of supply and demand — as well as the faltering U.S. dollar. "We've just had a red-hot increase in demand in the emerging economies of Asia, particularly China and India," he said. "The other contributor is the weakening value of the dollar compared with the Euro, since oil is priced and sold in dollars." A third offender: commodity speculation. "When you see a commodity like oil that will vary by 2 to 3 percent of its value in a day's time, you suspect that there's some speculation that's going on," Fisher said. "And I'm not saying it's a nasty word — people speculate in margins all the time — but that would, in my view, have some secondary role."

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A2: Peak Oil
Wars is no longer effective to control resources and has been abandoned for four decades.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html A most widely cited factor behind the recent US wars of choice is said to be oil. "No Blood for Oil" has been a rallying cry for most of the war's opponents. While some of these opponents argue that the war is driven by the US desire for cheap oil, others claim it is prompted by Big Oil's wish for high oil prices and profits. Interestingly, most antiwar forces use both claims interchangeably without paying attention to the fact that they are diametricallyopposed assertions. Not only do the two arguments contradict each other, but each argument is also wanting and unconvincing on its own grounds; not because the US does not wish for cheap oil, or because Big Oil does not desire higher oil prices, but because war is no longer the way to control or gain access to energy resources. Colonialtype occupation or direct control of energy resources is no longer efficient or economical and has, therefore, been abandoned for more than four decades.

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A2: Peak Oil
The Peak Oil theory only encourages war.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html Has oil peaked? The Peak Oil thesis maintains that world oil reserves, having reached their maximum capacity, are now dwindling, with grave consequences of oil shortage and high energy prices. While this has led many to call for more vigorous conservation, it has led others to argue in favor of unrestrained exploration and extraction of oil reserves, especially those located in the Alaskan Wildlife regions. Significant policy and/or political implications follow from the view that oil is running out. For one thing, this view provides fodder for the cannons of warprofiteering militarists who are constantly on the look-out to invent new enemies and find new pretexts for continued war and escalation of military spending. For another, it tends to disarm many anti-war forces that accept this thesis and, therefore, "internalize responsibility for US foreign policy every time they fill their gas tank. Thus they own the wars." [1] The Peak Oil thesis serves as a powerful trap and a clever manipulation in that it lets the real forces of war and militarism (the military-industrial complex and the pro-Israel lobby) "off the hook; it is a fabulous redirection. All evils are blamed on a commodity upon which we are all utterly dependent". [2]

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A2 – ME Destabiliziation
Oil price shocks are due to destabilizing wars and insecurity in the Middle East.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html Finally, and perhaps more importantly, claims of "peaked and dwindling" oil are refuted by the available facts and figures on global oil supply. Statistical evidence shows that there is absolutely no supply-demand imbalance in global oil markets. Contrary to the claims of the proponents of Peak Oil and champions of war and militarism, the current oil price shocks are a direct consequence of the destabilizing wars and geopolitical insecurity in the Middle East, not oil shortages. These include not only the wars in Iraq and Afghanistan, but also the threat of a looming war against Iran. The record of soaring oil prices shows that anytime there is a renewed US military threat against Iran, fuel prices move up several notches. The war also contributes to the escalation of fuel prices in indirect ways, for example, by plunging the US ever deeper into debt and depreciating the dollar, or by creating favorable grounds for speculation. As oil is priced largely in US dollars, oil exporting countries ask for more dollars per barrel of oil as the dollar loses value. Perhaps more importantly, an atmosphere of war and geopolitical instability in global oil markets serves as an auspicious ground for hoarding and speculation in commodity markets, especially oil, which is heavily contributing to the recently soaring oil prices.

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A2: Supply-Demand Key
Wall Street speculators control oil prices, not OPEC.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html As much as 60% of today's crude oil price is pure speculation driven by large trader banks and hedge funds. It has nothing to do with the convenient myths of Peak Oil. It has to do with control of oil and its price. Since the advent of oil futures trading and the two major London and New York oil futures contracts, control of oil prices has left OPEC and gone to Wall Street. It is a classic case of the tail that wags the dog. [8] Wall Street financial giants that created the Third World debt crisis in the late 1970s and early 1980s, the tech bubble in the 1990s and the housing bubble in the 2000s are now hard at work creating the oil bubble. By purchasing large numbers of futures contracts, and thereby pushing up futures prices to even higher levels than current prices, speculators have provided a financial incentive for oil companies to buy even more oil and place it in storage. A refiner will purchase extra oil today, even if it costs $115 per barrel, if the futures price is even higher. [9] This has led to a steady rise in crude oil inventories over the past two years, "resulting in US crude oil inventories that are now higher than at any time in the previous eight years. The large influx of speculative investment into oil futures has led to a situation where we have both high supplies of crude oil and highcrude oil prices .... In fact, during this period global supplies have exceeded demand, according to the US Department of Energy." [10]

Speculations of financial giants decide oil prices; dwindling oil is not why prices are high.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html To the extent that competitive oil markets and/or prices are occasionally manipulated, such subversions of competitive market forces are often brought about not so much by OPEC or other oil producing countries as by manipulative speculations of financial giants in New York and London. Wall Street financial institutions have accomplished this feat through "innovative" financial instruments such as establishment of energy hedge funds and speculative oil futures markets in New York and London.[14]

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A2 – Supply/Demand Key
Despite the fact that Saudis say they have surplus oil, prices continue to rise on speculation.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html The fact that the skyrocketing oil prices of late have been accompanied by a surplus in global oil markets was also brought to the attention of President George W Bush by Saudi officials when he asked them during a recent trip to the kingdom to increase production in order to stem the rising prices. Saudi officials reminded the president that "there is plenty of oil on the market. Iran has put some 30 million barrels of oil that it can't sell into floating storage. 'If we produced more oil, it wouldn't find buyers,' says the Saudi source. 'It wouldn't affect the price at all.'" [11] And why would producing more oil not "affect the price at all"? Because what is driving the soaring oil prices is not shortage but speculation: "with so much investment money sloshing around in the commodities markets, the Saudis calculate they have no hope of controlling short-term price fluctuations. They blame the recent price run-ups on speculation and fear of shortages [not real shortages], factors they say are beyond their control." [12]

Oil companies only limit supply of oil to keep prices up when there’s actually more.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html Producers' policy to sometimes curtail or limit the supply of oil, the so-called "limited flow" policy, is designed to raise the actual trading price above the market-determined price in order to keep high-cost US producers in business while leaving low-cost Middle East producers with an above average, or "super", profit. While for low-cost producers this limited flow policy is largely a matter of making more or fewer profits, for high-cost US producers it is a matter of survival, of being able to stay in or go out of business - an important but rarely mentioned or acknowledged fact. A hypothetical numerical example might be helpful here. Suppose that the market-determined, or free-flow, price of oil is $30 per barrel. Further, suppose this price entails an average rate of profit of 10%, or $3 per barrel. The word "average" in this context refers to average conditions of production, that is, producers who produce under average conditions of production in terms of productivity and cost of production. This means that producers who produce under better-than-average conditions, that is, low-cost, high productivity producers, will make a profit higher than $3 per barrel while high-cost, low efficiency producers will end up making less than $3 per barrel. This also means that some of the high-cost producers may end up going out of business altogether. Now, if the limited flow policy raises the actual trading price to $35 per barrel, it will raise the profits of all producers accordingly, thereby also keeping in business some high-cost producers that might otherwise have gone out of business. Furthermore, supply manipulation (in pursuit of price manipulation) is not limited to the oil industry. In today's economic environment of giant corporations, many of the major industries try and often succeed in controlling supply in order to control price. Take, for example, the automobile industry. Theoretically, automobile producers could flood the market with a huge supply of cars. But that would not be good business as it would lower prices and profits. So, they control supply, just as do oil producers, in order to manipulate price.

Several oil fields have been discovered.
Asher – Writer for DailyTech - 6/19/2008 (Michael, “World oil production continues to rise; outlook good for next decade or more,” DailyTech) http://www.dailytech.com/Despite+Reality+Belief+in+Peak+Oil+Persists/article12119.htm Several large new fields have been discovered in the past decade alone, such as Brazil's Tupi and Kazakhstan's Kashagan -- the latter not much smaller than Saudi Arabia's Gwahar, the largest field in the world. In fact, since 1965, we've found five new barrels of oil for every three we've burned. And vast North American deposits of tar sands and oil shale -- too expensive to process even a decade ago -- are now beginning to look like a bargain. Most of the world hasn't even been fully explored for oil, including vast stretches of land in Russia, the Arctic and Antarctica, and nearly all the deep sea itself. Some of these undiscovered fields are in places we can't pump oil -not with today's technology. By 2050, though, wells atop the thickest Antarctic ice, or through five miles of ocean floor will be trivial to implement.

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A2: Hubbert’s Peak
Hubbert’s peak is wildly off
Smil, economics professor @ the University of Manitoba, 2007 p. http://home.cc.umanitoba.ca/~vsmil/publications_pdf.html Hubbert is the patron saint of peak-oilers, seen as an infallible and astonishingly prescient seer because he correctly predicted the peak of the US oil production in 1970. Not quite. In his March 8, 1956 presentation before the Spring Meeting of the Southern District Division of Production of the American Petroleum Institute, Hubbert plotted two production curves, one for the ultimate US output of 150 billion barrels that peaked in 1962 at 2.6 billion barrels a year, and another one for the ultimate output of 200 billion barrels that peaked in 1968 at 3 billion barrels a year. In later revisions of this original work (the last major one was published in October 1968 and published as a chapter in the National Academy Science's Resources and Man in 1969) he put the peak of the complete cycle of US petroleum liquids (that is crude oil and natural gas liquids) at "about 3.5 billion barrels a year . . . during the first half of the 1970-decade." The actual peak came in 1970 at 4.12 billion barrels, 18% above Hubbert's prediction. That is not an insignificant miss, but it is a small error compared to Hubbert's insistence that the complete production curve of a resource is perfectly symmetrical -- that is, that the post-peak decline of extraction is a mirror image of the incline. This led Hubbert to produce a curve that put the US oil output in 1980 at about 3 billion barrels (while the actual production was 3.7 billion barrels) and the 2000 extraction at 1.2 billion barrels. The actual extraction was 2.8 billion barrels or 2.33 times higher, hardly an enviable accuracy for a 30-year forecast. And Hubbert's record is no better in forecasting the peak of global oil extraction. In 1969 he put it (for two different estimates of ultimately recoverable oil) either in 1990 at 25 billion barrels, or in 2000 at 37 billion barrels, projecting again a symmetrical curve and continuing high demand that prevailed during the 1960s. He could not, as nobody did, anticipate a substantial decline of oil demand following OPEC's two rounds (1973-74, 1979-81) of extortionary price increases. Consequently, the global oil extraction did not peak either in 1990, when it was actually about 4% below the level forecast by Hubbert, or in 2000, when it was, at 27.4 billion barrels, 26% lower than Hubbert's predicted peak. And while the global production still keeps going up, it was still below 31 billion barrels a year in 2006. So in this case Hubbert was nowhere near being correct either on the timing or the production level.

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Abiotic Oil
Oil is an abiotic substance, no risk of oil scarcity
Pfeiffer, FTW energy editor 3.12.04 p. http://www.questionsquestions.net/docs04/peakoil1.html ( Dale “A Word about a biotic oil”) There is some speculation that oil is abiotic in origin -- generally asserting that oil is formed from magma instead of an organic origin. These ideas are really groundless. All unrefined oil carries microscopic evidence of the organisms from which it was formed. These organisms can be traced through the fossil record to specific time periods when quantities of oil were formed. Likewise, there are two primal energy forces operating on this planet, and all forms of energy descend from one of these two. The first is the internal form of energy heating the Earth's interior. This primal energy comes
from radioactive decay and from the heat energy originally generated during accretion of the planet some 4.6 billion years ago. There are no known mechanisms for transferring this internal energy into any secondary energy source. And the chemistry of magma does not compare to the chemistry of hydrocarbons. Magma is lacking in carbon compounds, and hydrocarbons are lacking in silicates. If hydrocarbons were generated from magma, then you would expect to see some closer kinship in their chemistry. The second primal energy source is light and heat generated by our sun. It is the sun's energy that powers all energy processes on the Earth's surface, and which provides the very energy for life itself. Photosynthesis is the miraculous process by which the sun's energy is converted into forms available to the life processes of living matter. Following biological, geological and chemical processes, a line can be drawn from photosynthesis to the formation of hydrocarbon deposits. Likewise, both living matter and hydrocarbons are carbon based. Finally, because oil generation is in part a geological process, it

proceeds at an extremely slow rate from our human perspective. Geological processes take place over a different frame of time than human events. It is for this reason that when geologists say that the San Andreas fault is due for a powerful earthquake, they mean any time in the next million years -- probably less. Geological processes move exceedingly slow. After organic matter has accumulated on the sea floor, it must be buried by the process of deposition. In geological time, in order for this matter to be a likely prospect for hydrocarbon generation, the rate of deposition must be quick. Here is an experiment you can conduct to get an idea how slow the rates of deposition are. Place a small stone on the bottom of a motionless pond. Take another stone of about the same size and place it at the mouth of a small stream, a stream where the current is not so great that it will sweep the stone away. Check both of these stones yearly until they have been buried by deposition. You might see the stone at the mouth of the stream covered over within a few years, but it is unlikely that you will see the stone in the pond buried within your lifetime. It is a simple geological fact that the oil we are using up at an alarming rate today will not be replaced within our lifetime -- or within many lifetimes. That is why hydrocarbons are called non-renewable resources. Capped wells may appear to refill after a few years, but they are not regenerating. It is simply an effect of oil slowly migrating through pore spaces from areas of high pressure to the low-pressure area of the drill hole. If this oil is drawn out, it will take even longer for the hole to refill again. Oil is a non-renewable resource generated and deposited under special biological and geological conditions.

Recent studies support oils abiotic theory
Corsi author and conservative activist,February 1, 2008 p. http://www.worldnetdaily.com/index.php?fa=PAGE.view&pageId=45838 (Jerome R. Discovery backs theory oil not 'fossil fuel') A study published in Science Magazine today presents new evidence supporting the abiotic theory for the origin of oil, which asserts oil is a natural product the Earth generates constantly rather than a "fossil fuel" derived from decaying ancient forests and dead dinosaurs. The lead scientist on the study ? Giora Proskurowski of the School of Oceanography at the University of Washington in Seattle ? says the hydrogen-rich fluids venting at the bottom of the Atlantic Ocean in the Lost City Hydrothermal Field were produced by the abiotic synthesis of hydrocarbons in the mantle of the earth. The abiotic theory of the origin of oil directly challenges the conventional scientific theory that hydrocarbons are organic in nature, created by the deterioration of biological material deposited millions of years ago in sedimentary rock and converted to hydrocarbons under intense heat and pressure. While organic theorists have posited that the material required to produce hydrocarbons in sedimentary rock came from dinosaurs and ancient forests, more recent argument have suggested living organisms as small as plankton may have been the origin. The abiotic theory argues, in contrast, that hydrocarbons are naturally produced on a continual basis throughout the solar system, including within the mantle of the earth. The advocates believe the oil seeps up through bedrock cracks to deposit in sedimentary rock. Traditional petro-geologists, they say, have confused the rock as the originator rather than the depository of the hydrocarbons.

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Abiotic Oil
Oil is a biotic substance,
Heinberg Senior Fellow of Post Carbon Institute 10.6.04 p. http://www.rense.com/general58/biot.htm (Richard “The Abiotic Oil Controversy” ) The debate over oil's origin has been going on since the 19th century. From the start, there were those who contended that oil is primordial - that it dates back to Earth's origin - or that it is made through an inorganic process, while others argued that it was produced from the decay of living organisms (primarily oceanic plankton) that proliferated millions of years ago during relatively brief periods of global warming and were buried under ocean sediment in fortuitous circumstances. During the latter half of the 20th century, with advances in geophysics and geochemistry, the vast majority of scientists lined up on the side of the biotic theory. A small group of mostly Russian scientists - but including a tiny handful Western scientists, among them the late Cornell University physicist Thomas Gold - have held out for an abiotic (also called abiogenic or inorganic) theory. While some of the Russians appear to regard Gold as a plagiarist of their ideas, the latter's book The Deep Hot Biosphere (1998) stirred considerable controversy among the public on the questions of where oil comes from and how much of it there is. Gold argued that hydrocarbons existed at the time of the solar system's formation, and are known to be abundant on other planets (Jupiter, Saturn, Uranus, and some of their moons) where no life is presumed to have flourished in the past. The abiotic theory holds that there must therefore be nearly limitless pools of liquid primordial hydrocarbons at great depths on Earth, pools that slowly replenish the reservoirs that conventional oil drillers tap. Meanwhile, however, the oil companies have used the biotic theory as the practical basis for their successful exploration efforts over the past few decades. If there are in fact vast untapped deep pools of hydrocarbons refilling the reservoirs that oil producers drill into, it appears to make little difference to actual production, as tens of thousands of oil and gas fields around the world are observed to deplete, and refilling (which is indeed very rarely observed) is not occurring at a commercially significant scale or rate except in one minor and controversial instance discussed below. The abiotic theorists also hold that conventional drillers, constrained by an incorrect theory, ignore many sites where deep, primordial pools of oil accumulate; if only they would drill in the right places, they would discover much more oil than they are finding now.

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A2: Dependence Adv.
Plan is too little too late- shifts in fuel dependence can only occur long term
Korin, codirector for the institute of Global studies, May 22 2008 p. lexis (Anne, Congressional Testimony) The unique strategic importance of oil to the modern economy beyond that of any other commodity today stems from the fact that the global economy's very enabler, the transportation sector, is utterly dependent on it, with 220 million cars and trucks in the United States alone (today, contrary to popular belief, only 2 percent of U.S. electricity is generated from oil, and conversely only about 2 percent of U.S. oil demand is due to electricity generation.) With 97 percent of U.S. transportation energy based on petroleum, oil is the lifeblood of America's economy. America is poor in oil relative to its need. It consumes one of every four gallons in the world but has barely 3 percent of the world's proven reserves of conventional oil. The United States now imports over 60 percent of its oil, more than twice the ratio of imports before the 1973-74 Arab oil embargo. Neither efforts to expand petroleum supply nor those to crimp petroleum demand will be enough to reduce America's strategic vulnerability anytime soon. When the British Navy made the shift from coal to oil, then Lord of the Admiralty Winston Churchill famously remarked, "safety and certainty in oil lies in variety and variety alone." To diminish the strategic importance of oil to the international system it is now critical to expand the Churchillian doctrine beyond geographical variety to a variety of fuels and feedstocks.

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A2: Price Spikes
US has a large concentration of oil shale and tar sands.
Bureau of Land Management – 6/9/2008 (“Oil Shale and Tar Sands”, US Department of the Interior) http://www.blm.gov/wo/st/en/prog/energy/oilshale_2.html The United States holds the world’s largest known concentration of oil shale. Nearly five times the proven oil reserves of Saudi Arabia underlies a surface area of 16,000 square miles. The enormous potential of this domestic resource is a key to the Nation’s energy security and economic strength, and to the quality of life Americans enjoy today and hope to ensure for future generations. More than 70 percent of American oil shale — including the thickest and richest deposits — lies on federal land, primarily in Colorado, Utah, and Wyoming. These federal lands contain an estimated 1.23 trillion barrels of oil — more than 50 times the nation's proven conventional oil reserves. More than 50 tar sands deposits are found in eastern Utah, containing an estimated 12 to 19 billion barrels of oil. As oil prices rise, there is new interest in developing both of these domestic resources. The BLM is working to ensure that development of federal oil shale and tar sands resources will be economically sustainable and environmentally responsible.

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A2: Price Spikes
The high oil prices put tar sands in business.
The Economist – 5/29/2008 (“The Oil Price Recoil” The Economist) http://www.economist.com/opinion/displaystory.cfm?story_id=11454989 Hope at the bottom of the barrel So the oil shock will take time to abate. Some greens may welcome that, seeing three-figure oil as a way of limiting greenhouse emissions. Conservation will indeed increase. But everything high prices achieve could be done better by sensible carbon taxes. As well as curbing oil use, high prices have put tar sands in business which create far more carbon dioxide than conventional oil. Profits are going to ugly oil-fed regimes, not Western exchequers. And the wild unpredictability of prices will blunt the effect of dear oil on people's behaviour.

High oil prices makes tar sands profitable.
Greenpeace – No Date Mentioned (“Stop the Tar Sands,” Greenpeace Canada) http://64.233.167.104/search?q=cache:EoL2JoyiPeQJ:www.greenpeace.org/canada/en/campaigns/tarsands+Tarsands +and+oil+prices&hl=en&ct=clnk&cd=19&gl=us Buried below the Boreal Forest of northern Alberta is a source of oil known as the tar sands. Deposits of tar sands are spread out over 138 000 km2 of land (an area the size of Florida) and including 4.3 million hectares of the Boreal Forest. Until recently, it was too expensive and complicated to extract the tar sands to produce oil, but over the past few years increases in oil prices and technological changes have made it possible, and profitable. Companies are now producing over a million barrels of oil per day from the tar sands, and this number is constantly increasing. But the explosive growth of these projects has huge environmental costs, damaging land, air, water, forests, and the climate. Greenpeace is calling on oil companies and the government to stop the tar sands, for the sake of people and the planet.

High oil prices are having tar sands are hit the market but it also emits way more CO2.
Hawthorne – journalist – 2/12/2008 (Michael, “Refinery pollution may soar,” The Chicago Tribune) http://www.chicagotribune.com/news/local/chigreenhouse_12feb12,1,7080513,full.story?ctrack=1&cset=true Canada has huge reserves of tar-soaked clay and sand known as "tar sands" lying under the swampy forests of northern Alberta. At today's higher oil prices, these tar sands are seen as a profitable and reliable source of oil but they require environmentally devastating mining processes and vast amounts of energy to extract. The resulting heavy crude oil requires also more energy to process at refineries. Researchers have calculated that refining the Canadian tar sands crude produces 15 percent to 40 percent more carbon dioxide emissions than conventional oil, the Tribune reports. (Editors note: I believe this does not include "upstream" emissions resulting from the energy intensive mining processes.)

High oil prices make oil sands production profitable.
Blum – Staff writer – 2008 (Justin, “Where Oil Is Mined, Not Pumped,” The Washington Post) http://www.washingtonpost.com/wpdyn/content/article/2005/06/14/AR2005061401533_pf.html Until a few years ago, such projects -- called "oil sands" or "tar sands" -- sputtered at the fringes of the oil industry. But since technological breakthroughs brought down costs and oil prices have soared, companies have been investing heavily here. Oil-sands production is now profitable when a barrel of oil sells in the low $20s, analysts said -- far below the recent $50 range. Just outside this boomtown, huge machines dig up the earth and remove the oil sands, whose deposits of a substance called bitumen smell something like roofing tar and are as thick and sticky as molasses. Companies are mining hundreds of feet deep and running the unearthed deposits through a complex process to convert them into oil. Companies move enough dirt and oil sands in two days to fill Yankee Stadium

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A2: Price Spikes
OPEC will not inordinately jack prices up, limits on oil will drop.
Hossein-zadeh – Ph.D and Professor of Economics – 6/25/2008 (Ismael, “Are they really oil wars?”, Asia Times Online) http://www.atimes.com/atimes/Global_Economy/JF25Dj08.html It is also necessary to keep in mind that OPEC's desire to sometimes limit the supply of oil in order to shore up its price is limited by a number of factors. For one thing, the share, and hence the influence, of Middle Eastern oil producers as a percentage of world oil production has steadily declined over time, from almost 40 percent when OPEC was established to about 30 percent today.[16] For another, OPEC members are not unmindful of the fact that inordinately high oil prices can hurt their own long-term interests as this might prompt oil importers to economize on oil consumption and search for alternative sources of energy, thereby limiting producers' export markets. OPEC members also know that inordinately high oil prices could precipitate economic recessions in oil importing countries that would, once again, lower demand for their oil. In addition, high oil prices tend to raise the cost of oil producers' imports of manufactured products as high energy costs are bound to affect production costs of those manufactured products.

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A2: Price Spikes
High oil prices are threatening the world economy
Bloom – staff writer for The Market Oracle – 6/27/2008 (Brain, “World Recession 2009 as a Result of Peak Oil,” The Market Oracle) http://www.marketoracle.co.uk/index.php?name=News&file=article&sid=5236 Whilst most people are vaguely aware that oil is important to the world economy, few understand the true impact of the recent rise in the oil price. In 1998 the heads of state of the USA and Australia failed to ratify the Kyoto protocols. They were trying to protect their country's economies. Ironically, they engineered a situation where not only is the US economy under greater threat than it would have been had our leaders ratified the protocols, the entire world economy is now seriously threatened. It took a further nine years for the US government to finally understand how serious an error of judgement the failure to ratify Kyoto was. The issue had nothing to do with Carbon Dioxide emissions. It had to do with the fact that their failure to take action at that time blocked the march to market of alternative energy technologies. Finally, in June 2007, the Renewable Energy and Energy Conservation Tax Act (H.R. 2776) was passed. But the damage had been done. The sharp rise in the oil price – from around $65 a barrel in June 2007 to around $135 a barrel in June 2008 – has been a direct consequence of that original error of judgment.

Higher oil prices from oil peak will destroy our economy.
Adams - consumer health advocate and author – 7/21/2007 (Mike, “After peak oil: Will America survive?,” Natural News) http://www.naturalnews.com/021942.html $10 a gallon for gas means all your milk, bread, beef and other processed food items will double, triple or quadruple in price thanks to the oil-powered miles necessary to transport those items to your local grocery store. $10 a gallon means triple or quadruple the price for an airplane ticket. The cost of building supplies would skyrocket, diminishing home construction. The entire economy would nosedive into a deep depression, and all the financial bubbles we now pretend don't exist (the debt bubble, sub-prime lending bubble, real estate bubble, etc.) would come crashing down. $10 a gallon means massive layoffs and job loss. It means a huge recalibration of the economy, and it transforms "easy times" into "hard times." Oil is really that important to life as we know it today in first world nations.

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Transition Solves
Alternative energy forms can replace oil.
Adams - consumer health advocate and author – 7/21/2007 (Mike, “After peak oil: Will America survive?,” Natural News) http://www.naturalnews.com/021942.html Can alternative forms of energy replace oil? Yes and no. "Yes" because there's plenty of energy all around us that can replace oil. There's enough solar energy hitting the land in the state of Arizona, for example, to meet the entire energy needs of the United States. Likewise, there's enough wind power in Southern Wyoming to power the whole country, too. But this power is untapped. This is the "No" part of the answer: All the energy in the world is useless to you if you can't harness it. Without wind turbines, the wind in Wyoming is useless to us. Without solar panels, the Arizona desert is likewise useless to us as an energy source. Actually harnessing these alternative, renewable energy sources would require many billions of dollars in infrastructure spending, and right now, nobody in Washington seems to have the foresight to plan for a world without oil. There is currently very little investment in developing renewable energy sources. Thus, the United States may find itself energy starved in the near future even though it is surrounded by abundant (unharnessed) energy!

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Transition Solves
Renewable energy sources are the only way to save us from poverty and starvation.
Adams - consumer health advocate and author – 7/21/2007 (Mike, “After peak oil: Will America survive?,” Natural News) http://www.naturalnews.com/021942.html The oil economy will soon be history The era of cheap, easy oil is ending. The future can either be abundant and clean, or devastating and chaotic. It all depends on whether society will wake up and get serious about making a transition away from oil and towards clean, renewable energy sources. Constructing a couple thousand wind turbines isn't enough. Slapping some solar panels on the roof of your corporate headquarters building doesn't cut it (although it's great for corporate publicity and P.R.). We either pursue a massive switch to renewable energy using an Apollo space mission kind of national priority, or we are going to be stuck poor, broke and starving when the oil stops flowing.

Only renewable energy will save our economy our cities, populations, and military.
Adams - consumer health advocate and author – 7/21/2007 (Mike, “After peak oil: Will America survive?,” Natural News) http://www.naturalnews.com/021942.html If Bush had any brains left at all, he'd announce a JFK-like challenge to America to build a new, renewable energy infrastructure in the next decade. But alas, the man is too steeped in oil to seriously pursue alternatives. The truth is that if our next president does not put this nation on a radical, accelerated shift towards renewable energy, it will soon be too late to save America from economic collapse. Never underestimate the enormous impact that cheap energy has made on America today. Our economy, our cities, our population and even our military strength are all totally dependant on oil. Take away the oil, and America collapses under its own weight.

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