Oil Price - Budding Economists

[Gary A]

Ethanol is already cheaper than gasoline. Brazil was the only country to develop ethanol on a big enough scale to mass produce it. It is about half the price of petroleum gasoline in Brazil right now. Free trade investors are afraid to spend a lot of money on bio fuels because OPEC will drop the price of oil drastically and put them out of business.

[steveromagnino]

Ethanol is already cheaper than gasoline. Brazil was the only country to develop ethanol on a big enough scale to mass produce it. It is about half the price of petroleum gasoline in Brazil right now. Free trade investors are afraid to spend a lot of money on bio fuels because OPEC will drop the price of oil drastically and put them out of business.

The other thing are NGVs. In NZ much of the gas coming out of the ground was then converted into methanol, the condensate was (if I remember correctly) converted into oils of varying grades and much of the gas went to power plants and was burned in 30% efficiency single cycle power stations to create electricity. Diesel generation was used slightly. A lot of coal and hydro. Small amount of wind, cogen and geo thermal.

Better solution was to use natural gas for many things including for vehicles and as a replacement for electricity. Problem was, vested interests in the petrol industry; Shell BP Mobil and so on own the networks of service stations, and they successfully persuaded the govt that NGVs and CNG (which is the same fuel, but on a car converted to run both on gas and petrol) weren't any better than petrol; back when oil was much cheaper. They then ripped out as much of the network as they could as fast as they could; and any switch to other fuels is heavily dependent on the network effects of a decent distribution network. Note that these were the same companies pulling the stuff out of the ground; it is in their capacity to do both, but they make more money on the petrol, even if it is destroying the environment. Back then when I was pricing the stuff, I think the price was about 60% of the cost of petrol, and the payback for a taxi was less than a year for the price of the kit.

Switching from to another fuel would seem to almost impossible with these guys running dsitribution, as it is too hard to build the distribution network without massive effort, and deep pockets. It is like being the first person to own a fax; try selling that to someone. Will be interesting to see how far PTT gets (although they have the advantage of the taxi load).

The price spike after Katrina was due to threats to refining not worldwide supply chai mai? That;s what I recall in the Economist.

[barryofthailand]

The Iranian crises will have to be handled by Isreal. Isreal handled it when Sudam had a reacter and was planning on trying to develop nuclear weapons, and believe me they will handle it again. The united nations in my opinion is useless.

Barry

[PeaceBlondie]

Katrina and Rita threatened to destroy several things: roughly 27% of the refineries, much of the pipeline, and a huge number of off-shore rigs. It highlighted serious problems in all those areas. There will be no new refineries; they aren't even considered profitable, if you factor in all the risks.

There isn't enough growing land in all the world (not even in Brazil, unless they finally finish destroying the Amazon forests) for all the fields needed to supply ethanol. And we're only talking about less than 20% substitution of ethanol for petrol so far. It's doubtful that's even good for modern engines, and 100% biofuel is probably much further in the future.

One key to getting consumption down is to double the price of energy everwhere. However, demand is so constant, inflexible and expanding, and people would pay $5 per gallon for gasoline in the USA before they started buying Honda Civic 1000 baby coupes again. Does anybody remember the Honda S600? Nobody bought them. However, Honda now makes many 1,800 c.c. motorcycles!

[Gary A]

Do a Google on cellulose and ethanol. The first commercial plant came on line last year in Canada. They make ethanol out of wheat straw. The grass on the Great Plains of the US is called switch grass and it too makes ethanol. You DON'T have to raise crops to make ethanol.

There isn't enough growing land in all the world (not even in Brazil, unless they finally finish destroying the Amazon forests) for all the fields needed to supply ethanol. And we're only talking about less than 20% substitution of ethanol for petrol so far. It's doubtful that's even good for modern engines, and 100% biofuel is probably much further in the future.

[steveromagnino]

The Iranian crises will have to be handled by Isreal. Isreal handled it when Sudam had a reacter and was planning on trying to develop nuclear weapons, and believe me they will handle it again. The united nations in my opinion is useless.

Barry

Er...maybe,.

Israel managed to get hold of the material needed to make their own bombs in a James Bond type operation a few years back, and since then they can just lean on USA to supply them with non nuclear weaponry and money or else they can always go blow something/someone up. If they had not stolen the gear needed for the bomb, they would have been long gone by now. As I recall, they acquired their bomb because USSR was giving Egypt a bomb and reactors etc; they knew without their own bomb they would not survive. As it turned out USSR didn't trust the Egyptians, and just provided a bomb full of metal filings instead of a real bomb. Similar to the scuds they dumped on our mate Sadaaaaaam.

I am guessing Israel are already well into spy mode and unilateral action will be taken if needed, after all they have had more UN Resolutions passed against them than everyone else put together; they be well tough innit. Otherwise, those nutters (Israel & Iran) will both have bombs, and I am questioning whether either is smart enough to avoid using them.

But back on topic...NGV is one step, the real solution is to stop using <deleted> energy for everything; walk instead of drive; turn the aircon off; stop using lots of stuff made of plastic; that sort of thing. But obviuosly people aren't going to do that; Clinton opened the door for gas guzzling SUVs and you know Bush is pro oil guzzling too.

[mark45y]

The Iranian crises will have to be handled by Isreal. Isreal handled it when Sudam had a reacter and was planning on trying to develop nuclear weapons, and believe me they will handle it again. The united nations in my opinion is useless.

Barry

Er...maybe,.

Israel managed to get hold of the material needed to make their own bombs in a James Bond type operation a few years back, and since then they can just lean on USA to supply them with non nuclear weaponry and money or else they can always go blow something/someone up. If they had not stolen the gear needed for the bomb, they would have been long gone by now. As I recall, they acquired their bomb because USSR was giving Egypt a bomb and reactors etc; they knew without their own bomb they would not survive. As it turned out USSR didn't trust the Egyptians, and just provided a bomb full of metal filings instead of a real bomb. Similar to the scuds they dumped on our mate Sadaaaaaam.

I am guessing Israel are already well into spy mode and unilateral action will be taken if needed, after all they have had more UN Resolutions passed against them than everyone else put together; they be well tough innit. Otherwise, those nutters (Israel & Iran) will both have bombs, and I am questioning whether either is smart enough to avoid using them.

But back on topic...NGV is one step, the real solution is to stop using <deleted> energy for everything; walk instead of drive; turn the aircon off; stop using lots of stuff made of plastic; that sort of thing. But obviuosly people aren't going to do that; Clinton opened the door for gas guzzling SUVs and you know Bush is pro oil guzzling too.

China does not have many SUV’s and most of the people walk. They are into a brand new thing of making their own bicycles.

It is nice to feel that you can do something. It is nice to try and make people who drive SUV’s and don’t walk feel somehow morally inadequate.

Eat less and it will take less petrol to push around the fat asses in the West. But that is not really the problem.

The problem is China’s fantastic industrial growth ever since they have put the profit motive back in business. There is a new factory springing up every day. The new factories demand energy. Hong Kong opened up and the mainland Chinese have seen what it is like to holiday in Thailand. Money has no value without women and the Chinese have met the Thai ladies. Better start getting some new oil ready they have finally found a reason to industrialize.

I have often marveled at the power of women. Put a thousand Thai bar girls in Baghdad instead of 10,000 troops and you would have peace. The only thing the men would be worried about is getting the money for the honeys. Martyrs would be a thing of the past. The guys would start drilling new oil wells by the minute. Because even Mohammed knows that a Da or Noi in the hand is 7 virgins in the bush.

Air lift a hundred pre fab Go go’s staffed with Pattaya’s finest into Iran and the mullahs would be gone in a week.

Security? I have been there and done that. I walked into a jungle with a thousand NVA regulars and was not the least frightened. But ten pissed off bargirls in Patpong have shivered my timbers and made me run a mile without stopping.

I sincerely doubt if Thailand will realize they are the answer to the energy crisis or the security problems of the free world.

I have see the Arabs in Bangkok. These guys are driven. A couple of trips and they completely changed. They aren’t terrorists anymore. Their punters.

Maybe the free world just needs to give men from the middle east free vacations to Thailand. A three day holiday should do it. I can hear the dialog.

Achmed, how was the devil city of Bangkok. Oh Abdul it was terrible beyond description.

Good, so we blow ourselves up tomorrow along with the infidels.

No, Abdul. I have an idea for drilling a new oil well.

Why Achmed the seven virgins are waiting for us.

I know, I know but I think the Prophet would want me to see Thailand one more time to try and convert the infidels.

Why Achmed we are supposed to cut the heads off of the infidels? Did you say head Abdul?

Yes, I said head. That’s what I thought you said.

I have to go drill oil well now. See you later.

Edited April 20, 2006 by mark45y

[penzman]

Always makes me laugh, prices went up because of hurricane Katrina, bla bla bla. The best one was "because Ariel Sharon is seriously ill"...

I remember reading a great article with a famous economist (sorry, I forget the name ) that mentioned the whole thing may is manipulated in order to slow down China and India, giving the U.S. a few more years before it chokes. Kind of makes sense.

[stevehaigh]

(Oh yeah, Brazil is expected to completely stop importing oil within a year, as they have managed to switch almost everything over to ethanol instead of oil. Something other industrialized countries could have been working on for decades, but haven't for some reason).

where is your source for this? anyhow, i have heard that ethanol (from corn at least) uses as much oil to produce as it replaces so there is no net reduction in oil use. maybe they get ethanol from somwhere else?

[Gary A]

The US government spent millions of dollars for studies that turned out to be simply bullshit. They are wrong and were finally questioned when Brazil became very successful mass producing ethanol. If you Google the subject you will find more information than you could ever read. Distilling ethanol is the most energy intensive process. Using corn, the corn cobs have more than enough energy for that process. The product left over after the ethanol extraction process makes very good animal food. I'm not big on conspiracy theories but this whole energy thing REALLY stinks. Mark my words! When alternative fuels make a dent on fossil energy use there will suddenly be a glut of oil and the prices will fall drastically simply for the purpose of putting alternative energy producers out of business. Brazil started their program in the 70's and didn't give up on it like the rest of the world did. This is one of my favorite subjects. In the late 70's oil from shale and oil sands was being produced. Unfortunately it makes poor quality gasoline and not much of it. It DOES make VERY good diesel fuel. Crude oil prices came tumbling down and put them out of business. Why does the US produce the dirtiest diesel fuel in the world? In Europe more than 30 percent of all new cars are diesel because they get 30 percent better fuel economy. In the US diesel is more expensive than gasoline even though the cost of refining is MUCH less. Here in Thailand diesel is cheaper than gasoline and the quality is much higher than the diesel sold in the US. WHY? Why does the US pay farmers billions of dollars every year to NOT produce crops? Something stinks BIG time!

(Oh yeah, Brazil is expected to completely stop importing oil within a year, as they have managed to switch almost everything over to ethanol instead of oil. Something other industrialized countries could have been working on for decades, but haven't for some reason).

where is your source for this? anyhow, i have heard that ethanol (from corn at least) uses as much oil to produce as it replaces so there is no net reduction in oil use. maybe they get ethanol from somwhere else?

[Head Snake]

Its IS supply and demand. China, India predominantly adding most demand but plenty of other countries trying to live the BMW/Mercedes dream.

Oil, for many decades, had been a commodity not even tracking the cost of living. Compare water, milk, and other consummables over the last 100 years and oil is just recently catching up.

Also compare gold and other commodities like copper, steel, nickel. They are all increasing in price based off supply and demand. The same drivers: China, India and all the other developing countries.

surprisingly too, salaries are increasing in countries that once had such oversupply of people, professionals from those countries were being paid a fraction of expat salaries. The gap is closing there too.

Interesting times. All I know is every country seems to be prospering. Maybe one of the best economic period of the world's history..

[Gary A]

Brazil will stop importing oil this year. Their ethanol production is now so efficient that they can compete with $35 a barrel oil. Here's a link to reinforce my opinion:

http://ipegroup.net/2006/04/11/2006-the-year-of-bio-fuels/

[britmaveric]

Glut of tar pits that can be used for oil that hasnt been tapped. They say its very expensive, but is it really?

[~G~]

Israel managed to get hold of the material needed to make their own bombs in a James Bond type operation a few years back...

...Otherwise, those nutters (Israel & Iran) will both have bombs...

In what alternative reality are you living? Israel have built a nuclear reactor in the late 50s, that was last inspected by Americans in the 60s, and was not subject to any foreign supervision ever since. What do you think they did there all this time, posting messages in internet forums?

Edited April 21, 2006 by ~G~

[cclub75]

Brazil will stop importing oil this year. Their ethanol production is now so efficient that they can compete with $35 a barrel oil. Here's a link to reinforce my opinion:

http://ipegroup.net/2006/04/11/2006-the-year-of-bio-fuels/

Yes. It's a fact that Varig's airplanes can fly with ethanol.

Same for the plastics/resins industry. And... oh and what about fertilizers... to help grow the crops ? Ah yes : shit. It works well too.

... ethanol is a pink idea of sweet greenists.

But actually, on a large scale (world), it doesn't solve anything.

[Gary A]

Have you ever heard of natural gas? That's where most fertilizer comes from. Have you ever heard of vegetable oil? They make plastic from that. Have you ever heard of cellulose? That is the alcohol feedstock of the future. I'm glad you mentioned shit. That makes great methane.

Brazil will stop importing oil this year. Their ethanol production is now so efficient that they can compete with $35 a barrel oil. Here's a link to reinforce my opinion:

http://ipegroup.net/2006/04/11/2006-the-year-of-bio-fuels/

Yes. It's a fact that Varig's airplanes can fly with ethanol.

Same for the plastics/resins industry. And... oh and what about fertilizers... to help grow the crops ? Ah yes : shit. It works well too.

... ethanol is a pink idea of sweet greenists.

But actually, on a large scale (world), it doesn't solve anything.

[cclub75]

Have you ever heard of natural gas? That's where most fertilizer comes from. Have you ever heard of vegetable oil? They make plastic from that. Have you ever heard of cellulose? That is the alcohol feedstock of the future. I'm glad you mentioned shit. That makes great methane.

Indeed. And at least we have a common ground of understanding.

More seriously, yes you are right. We have a whole range of very "narak" technologies...

The only problem, and allow me to go back to the topic, is... how much it costs. Price. That's the only question.

So it would be possible in a very advanced society (and on small scale from my point of view) to use new and experimental technologies to replace oil for energy and products.

But can you imagine this scheme, for the world, on a short or medium term ?

You guess the answer.

[Gary A]

It's certainly not a problem that can be solved quickly. It took Brazil 30 years to be competitive with $35 a barrel oil. Oil from shale and oil sands cost about $45 a barrel and they don't have enough capacity to supply much of the needs. The big problem is that most OPEC oil costs less than a dollar a barrel to lift out of the ground. That means that if governments don't support alternative energy in a big way OPEC will simply put them all out of business by lowering the price of crude oil.

My fondest wish is to live long enough to see the world tell OPEC to EAT their oil.

Have you ever heard of natural gas? That's where most fertilizer comes from. Have you ever heard of vegetable oil? They make plastic from that. Have you ever heard of cellulose? That is the alcohol feedstock of the future. I'm glad you mentioned shit. That makes great methane.

Indeed. And at least we have a common ground of understanding.

More seriously, yes you are right. We have a whole range of very "narak" technologies...

The only problem, and allow me to go back to the topic, is... how much it costs. Price. That's the only question.

So it would be possible in a very advanced society (and on small scale from my point of view) to use new and experimental technologies to replace oil for energy and products.

But can you imagine this scheme, for the world, on a short or medium term ?

You guess the answer.

[PeaceBlondie]

Switch grass? Which rich witch's grass is that grass? I only ever heard of it when George Bush mentioned it in that phony speech (State of the Union in January, maybe). Most new technologies in the energy business take DECADES to be developed. For example, Dr. Wankel's rotary engine. Only Mazda has mass produced it, and that's usually only been for the RX-7 sports car, in small quantities. But Wankel's first rotary was in an NSU, around 1962!

Some new technologies can be adapted in five years, but not so in the oil business. The outspoken and combative ex-CEO of Exxon-Mobil recently gave a great speech explaining that in his business, it takes up to 40 years to make a profit on an idea such as a new oil field, or new technology.

And since this thread started, oil prices on the spot market have exceeded $74. But what's the average price for a barrel of crude oil purchased by the big oil companies - more like $24?

[Carmine6]

100% replacement of oil doesn't need to happen for there to be a serious drop in the price. Brazil has already done a lot of the R&D. They're at 20% ethanol use and around $1/gallon production cost. The real technological hurdle was getting cars to the point where they can switch between gasoline and high percentage ethanol without retrofitting. The auto industry is finally there.

In the US, ethanol production has to be subsidized because corn yields a lot less ethanol than sugar does, but India is the number 2 sugar producer behind Brazil. They could easily turn into the number 2 ethanol producer.

If OPEC really did try to stamp out the competition, would anyone really be crying? It's a 50% cut from here and they can't undo the technical advances. I was reading an article yesterday about adding sails (fixed sails, not fabric) to cargo ships. The last time oil was high, one captain added sails to a mid sized cargo carrier and it paid for itself in 100 days through fuel savings. Then oil dropped to $12/barrell and they cut them off. This time around the sails being planned are so much more automated and efficient that they could be permanent.

I'd be astonished if oil is still this high a year from now. The economies of the world would have to be unbelievably strong for demand to not soften a lot.

It's certainly not a problem that can be solved quickly. It took Brazil 30 years to be competitive with $35 a barrel oil. Oil from shale and oil sands cost about $45 a barrel and they don't have enough capacity to supply much of the needs. The big problem is that most OPEC oil costs less than a dollar a barrel to lift out of the ground. That means that if governments don't support alternative energy in a big way OPEC will simply put them all out of business by lowering the price of crude oil.

My fondest wish is to live long enough to see the world tell OPEC to EAT their oil.

Have you ever heard of natural gas? That's where most fertilizer comes from. Have you ever heard of vegetable oil? They make plastic from that. Have you ever heard of cellulose? That is the alcohol feedstock of the future. I'm glad you mentioned shit. That makes great methane.

Indeed. And at least we have a common ground of understanding.

More seriously, yes you are right. We have a whole range of very "narak" technologies...

The only problem, and allow me to go back to the topic, is... how much it costs. Price. That's the only question.

So it would be possible in a very advanced society (and on small scale from my point of view) to use new and experimental technologies to replace oil for energy and products.

But can you imagine this scheme, for the world, on a short or medium term ?

You guess the answer.

Edited April 22, 2006 by Carmine6

[Gary A]

Well Blondie, I invited you to do an Internet search on cellulose and you apparently don't want to bother. Cellulose is the alcohol feed stock of the future. It doesn't matter if it is grass, tree twigs, leaves, wheat straw, corn stalks, soybean straw or whatever weed you choose. It is cellulose and cellulose is basically starch and can be converted to sugars to make ethanol. It took Brazil 30 years to become efficient but it can be done if the governments will support the technologies. What does the Wankel engine have to do with alternative fuels? It is a light weight powerful engine that is anything BUT efficient. Anything is better than being blackmailed by OPEC.

Switch grass? Which rich witch's grass is that grass? I only ever heard of it when George Bush mentioned it in that phony speech (State of the Union in January, maybe). Most new technologies in the energy business take DECADES to be developed. For example, Dr. Wankel's rotary engine. Only Mazda has mass produced it, and that's usually only been for the RX-7 sports car, in small quantities. But Wankel's first rotary was in an NSU, around 1962!

Some new technologies can be adapted in five years, but not so in the oil business. The outspoken and combative ex-CEO of Exxon-Mobil recently gave a great speech explaining that in his business, it takes up to 40 years to make a profit on an idea such as a new oil field, or new technology.

And since this thread started, oil prices on the spot market have exceeded $74. But what's the average price for a barrel of crude oil purchased by the big oil companies - more like $24?

[Gary A]

Since oil from shale and oil sands cost $45 a barrel you would choose not to develop it? Canada and the US have more oil from shale and oil sands than has ever been used in the history of the world. You would choose to allow Bush and big oil to blackmail us forever? That is exactly the problem. Since it cost OPEC less than a dollar a barrel to lift oil out of the ground they can choose to put alternative energy out of business anytime they choose. I'd rather pay double than to be blackmailed.

Switch grass? Which rich witch's grass is that grass? I only ever heard of it when George Bush mentioned it in that phony speech (State of the Union in January, maybe). Most new technologies in the energy business take DECADES to be developed. For example, Dr. Wankel's rotary engine. Only Mazda has mass produced it, and that's usually only been for the RX-7 sports car, in small quantities. But Wankel's first rotary was in an NSU, around 1962!

Some new technologies can be adapted in five years, but not so in the oil business. The outspoken and combative ex-CEO of Exxon-Mobil recently gave a great speech explaining that in his business, it takes up to 40 years to make a profit on an idea such as a new oil field, or new technology.

And since this thread started, oil prices on the spot market have exceeded $74. But what's the average price for a barrel of crude oil purchased by the big oil companies - more like $24?

[backflip]

"Brazil will stop importing oil this year. Their ethanol production is now so efficient that they can compete with $35 a barrel oil. Here's a link to reinforce my opinion:

http://ipegroup.net/2006/04/11/2006-the-ye...io-fuels/"

Baloney, and next time you want to borrow someone else's opinion, choose one based on fact. Brazil will stop importing oil due to a new oil rig, not because of efficient ethanol production.

[jas007]

I wonder why it matters? I remember back in the 70s when I first paid 50 cents a gallon for gas. It seemed like a real rip-off. People were predicting the end of the world, etc. And yet, over time, things adjusted via inflation. So here we are again, wondering what's next. What worries me is not the price of oil, but the value of my money. The current administration is playing a very dangerous game, if you ask me. Borrowing money like there's no tomorrow, cutting taxes without a reduction in spending, and pretending everything is just great. I don't think so. Either I'm missing something or they have every intention of creating runaway inflation. And so, how do we protect against that? Gold? Real estate? Energy stocks?

J

[chuchok]

[cclub75]

I wonder why it matters? I remember back in the 70s when I first paid 50 cents a gallon for gas. It seemed like a real rip-off. People were predicting the end of the world, etc. And yet, over time, things adjusted via inflation. So here we are again, wondering what's next. What worries me is not the price of oil, but the value of my money. The current administration is playing a very dangerous game, if you ask me. Borrowing money like there's no tomorrow, cutting taxes without a reduction in spending, and pretending everything is just great. I don't think so. Either I'm missing something or they have every intention of creating runaway inflation. And so, how do we protect against that? Gold? Real estate? Energy stocks?

Well you seem to think that 70 and 80's oil shocks had little effects.

It was rather massive for the west.

Today the situation would be worst : fast developping countries (china, india, and thailand of course) would be affected first. And greatly affected.

I repeat myself : but if you consider exportations of Thailand for instance (agriculture, automobiles), the country is going to suffer a lot of the coming oil crisis....

As for inflation, you answered the question yourself : it's not a runaway but a "highway" of inflation if i may say.

US are too shy now to reveal their M3 figures.

The world is swiming in an ocean of cash... Why do we see all thoses real estate bubbles worldwide (from spain, to US, to Bangkok, to small villages in France up country ?) and thoses insane prices for commodities (gold +50 % in 1 year, coper +100 % in 1 year) ? Growth ? Yes sure.

And meanwhile, our dear gvt, in all the countries, continue to speak about "prices index" and "core inflation" with little figures.... I mean, it's ridiculous, even hilarious.

It's true that we need coper for the zillions of houses they are building in china, or thailand...

But it could also mean that people don't know what to do with their cash, and/or have some distrust problem with paper money and are willing to buy "real" things, whatever their prices.

The situation is exactly the same if you compare with 2000. A bubble. The only difference : it's not one tech bubble, but many.

And i would say, it's worse because we have now some real geopolitics issues (iran) on the top of that.

[Gary A]

You are missing the point. Ethanol is only a small part of the energy package but it is a part of the overall picture. Brazil should be commended because they are now self sufficient. The US government studies showed that ethanol would never be economical. Brazil proved them wrong. A country that once imported 70 percent of their energy is now self sufficient. There are MANY forms of alternative energy that are being ignored. The world is hooked on OPEC oil at a cheap price and as a result never look beyond tomorrow. Sooner or later we will all pay the price for neglecting our future energy needs. Alternative energy needs a lot of support and huge investments. As soon as crude oil prices drop AGAIN, those projects will stop without public and government support. Right now bio-diesel, ethanol, solar, wind, hydro, fuel cells and nuclear are back in the spotlight and doing well. They will ALL suffer huge financial losses when crude oil prices drop and their progress will stop. The world will have to tax the hel_l out of OPEC oil and use those funds to continue to develop alternative energy. OK, I'm off my soapbox.

"Brazil will stop importing oil this year. Their ethanol production is now so efficient that they can compete with $35 a barrel oil. Here's a link to reinforce my opinion:

http://ipegroup.net/2006/04/11/2006-the-ye...io-fuels/"

Baloney, and next time you want to borrow someone else's opinion, choose one based on fact. Brazil will stop importing oil due to a new oil rig, not because of efficient ethanol production.