The Formula

This novel (Steve Shagan) was a technothriller at the time, but now is AH, I suppose. The novel tells the story of a group of people seeking to gain control of a secret Nazi formula that, when added to liquid fuel created from coal, enhances it by a massive degree, essentially making coal more useful for fuel than oil. Obviously, this would have had an enormous affect on the world, assuming it was introduced onto the market in the 70's (the time the book came out). Most of the world's coal is in the industrialized western nations; thus, the middle east would be rendered irrelevant almost overnight. The hero of the book gets ahold of the formula and gives it to Israel, as compensation for the Holocaust. The movie wimped out, and had the hero giving it to Switzerland, and the big evil oil company exec (Marlon Brando) ended up getting it anyway.
Let us suppose that it happened as in the book; Israel now holds a secret that will completely alter the balance of power in the world, by making the western nations able to supply their own fuel, and the ME oilfields will be useful only as long as it takes the west to set up factories for coal conversion using the formula. What happens to the world from this point on?
 
Where to begin...

First, the oil industry goes belly up 5 minutes after the announcement and the test by Israel of the formula while at the same time every company that mines for coal doubles in value in the same amount of time. That will have some economic ripples immediately as consumers demand cheap gas until they can get new "enhanced" coal vehicles. Detroit puts all its resources into making an engine to use "enhanced" coal. Basically any industry/business that uses oil starts finding ways to convert its energy usage. With the demand for cheap oil prices, businesses save money and bust the economy not only in the US, but around the world.

Second, there is a major geopolitical shift in the Middle East. European countries and the UN quickly side with Israel in the Palestinian issue. US policy changes radically instead of helping prop up the repressive ruling families & regimes in various Middle East countries that prove cheap oil, the US calls for reforms including human rights and populous government. The US starts decreasing foreign aid to the Middle East.

Third, politics in the US changes forever. The oil industry and the coal industry will be at war with lobbying Congress. The oil industry will pull on every Congressman and Senator from Texas, Louisiana, Alaska, and where ever else oil is drilled in the US. The coal industry will pull on every Congressman and Senator from Colorado, Pennsylvania, Ohio, West Virgina, and where ever else they mine coal (Nevada, Montana?).

Let's say this happens in 1975. By 1980, every nation in the world (except a few Arab countries) recognizes Israel as a nation and allows it to load up on weapons to defend/suppress (depending on your viewpoint). The US economy is booming because of cheap gas prices and the introduction of the first generation of "enhanced" coal vehicles hits the roads that have long lasting fuel. Europe and Asia are behind the US in changing over while the USSR is basically shut out and their economy is starting to sputter. In the Middle East, Iran has become a constitutional monarchy with a mixture of Western democracy with Islamic traditions. Egypt is starting to devolve into civil war along with several other countries. Iraq meanwhile is starting to get the world's attention because of its leader.

By 1985, the US has had a small recession but its economy is quicky recovering. The USSR is starting to teeter on its feet, it can get oil from some of the Middle East countries not in civil war but the US, Europe, and Asia are five years ahead in technology with PCs and the beginnings of cell phones. Iran, Kuwait, Bahrain, Qatar, and several other small Arab countries are stable constitutional monarchies. Jordan, which has basically been at peace with Israel since 1967 but signed a peace treaty along with Iran with Israel in 1979, had to expel a lot of Palestinian refugees because they threatened to send the country into civil war. Many of the Palestinians went into Syria and war torn Lebanon. Saudi Arabia and Egypt are some of a few countries in civil war. In Iraq, the leader denounces the "Jewish" plot.

By 1990, the Cold War is over ending in 1986 when seveal Eastern European countries asked for economic help from the West and some military. A mob in East Berlin toppled the East German government, many East German troops joined the mob and prevented Soviet troops from stopping it. Hungary and Poland then left the same night followed by Czechoslavakia two days later. The USSR disbanded in 1988 after efforts to keep the Baltic republics and Ukraine in the Union failed. The US entered the new decade the biggest and strongest economy in the world just as Detroit introduces the second generation of "enhanced" coal vehicles that added many miles per. An Islamic state in Egypt was established in 1989 along with one in Saudi Arabia later that year. Syria absorbed Lebanon in 1987.

By 2000, the world is totally different. The US is still the biggest economy as third generation "enhanced" coal vehicles hit the market. The Middle East is recovering from a spat of major wars. First in 1991, Iraq invaded Kuwait and Jordan for better ports on the Persian Gulf and to avenge the Palestinians. The same time the Islamic Republic of Egypt and Syria attacked Israel. Jordan was soon attacked by Syria. Israel, Jordan, Iran, and later Turkey joined forces and routed the three aggressor nations liberating Kuwait in the process. The international community helped reconstruct Iraq and Syria while Egypt again devolved into civil war making any reconstruction efforts impossible. Saudi Arabia however encouraged terrorist attacks by Palestinians now living in the Islamic republic. Yugoslavia was divided peacefully in the early 90s as democratic elections seperated the various states. The EU developed quickly in the early 90s and is a close second to the US economy. Japan is the third largest economy in the world as it gets the majority of its coal from the US, but Russia is starting to export its coal reserves and benefit from quick technology increases.
 
note that there would still be a need for oil... lubricants, asphalt, plastics, etc... many nations would still have to import oil for this (notably Japan), as they have no native oil fields. While the Gulf states would see a drastic decline in exports, it wouldn't be to zero. Still, they are not going to have the income to do a fifth of the things they do now....
 

NapoleonXIV

Banned
The demand for oil for petrochemicals would probably be a little more than you are saying as oil will also now have to sub for the substantial number of things made from coal tar. Again, it won't be the same as before but still substantially less than zero.

Coal reserves are vast Yes?? Remember it will still used substantially in electricity generation (unenhanced, since the plants are not designed for that), coke for steelmaking etc.
 
No secret formula needed

We can already make fuel from coal. Now a way to make it cheaper would be usefull. Instead of using the sythesis gas route, or the pyrolysis route, maybe some kind of supercritical carbon dioxide suspended catalyst to turn coal tar into light fractions using hydrogen gas from the coal carbon fraction? At low temperatures so you could build a cheap 'plastic pipe' type refinery?
Only the arabs would still produce oil. Everyone else would produce coal instead of oil because the coal is cheaper than oil from anywhere except the arabs. The arabs would no longer have a monopoly on gasoline and diesel, just a monompoly on plastics from naptha, and that at a lower price, say, ten dollars a barrel equivalent. They would sell twice as much at half the price.
No big change.
 

Raymann

Banned
Wow! Don't we have the largest proven coal reserves in the world? The US would be self-sufficient in both oil and coal along with natural gas. The downside would be a large shift in the locations of energy production. West Vigernia would go from dirt poor to very rich, Louisiana would go from just poor to dirt poor (I'm from there). I suppose that in totality the US would be richer due to the excess of coal and our ability to export it to Japan.

Also dosen't Britian and Germany have significant reserves of coal? I think China does too? Finally about the middle east, what would they have to sell now, dates? We might have a problem though because as some/all of them decend toward war, some might choose to ally themselves with the communists; on the other hand, some might latch themselves onto the West and then we'd have a big problem.
 
how could the demand for ME oil not decrease? By far, the biggest use of it is for fuel. All the other demands (asphalt, plastics, etc.) are a fraction of the total usage. Where does the huge increase in demand for plastics come from so that the ME continues to sell the same amount, even at a lower price? In any event, the percentage of oil use for these items could be met by the US's own oil fields (and the UK too, I suppose, would be fine, with the North Sea oil). Yes, the largest coal reserves are in the industrialized western nations (US, UK, Europe... not sure about China).
It's been a loooong time since I read the book, and I don't remember just why the formula was so important. IIRC, it made coal fuel a lot more efficient; apparently, there's a lot of waste when you make fuel from coal.
Hmm... what would be the long term affects on having Israel hold the patent for the formula?
 
Cost substitution

Raymann said:
Wow! Don't we have the largest proven coal reserves in the world? The US would be self-sufficient in both oil and coal along with natural gas. The downside would be a large shift in the locations of energy production. West Vigernia would go from dirt poor to very rich, Louisiana would go from just poor to dirt poor (I'm from there). I suppose that in totality the US would be richer due to the excess of coal and our ability to export it to Japan.

Also dosen't Britian and Germany have significant reserves of coal? I think China does too? Finally about the middle east, what would they have to sell now, dates? We might have a problem though because as some/all of them decend toward war, some might choose to ally themselves with the communists; on the other hand, some might latch themselves onto the West and then we'd have a big problem.

Lots of countries have coal. All a new way to turn coal into oil does is lower the cost of oil. It does not affect the price of coal because we already use so much coal for electricity that the new demand for coal will have a minor affect on the price.
Coal is a difficult material to dig up, grind up, transport, etc. Oil is easier to move and burn, so it is still worth money even if the price goes down.
If the price of oil goes down, the Middle East will sell just as much or even more, because Middle East oil costs less than five dollars a barrel to get out of the ground while everybody else takes at least twice as much to get out of the ground. It's the other areas that won't sell as much oil if the price goes down.
Lousiana still pumps a lot of oil, but it has other interests. The people in the state will just move to doing something else. For instance, if oil prices go down, there will be less money from drilling, and more from making cheap oil into plastics. After all, most of the price of plastics is the oil used to make them. Not all, just most.
 
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looking beyond just the costs though, wouldn't the US/Europe have strong incentives to develop coal/fuel technology? Getting out of the morass of middle eastern politics would be hugely attractive. I'd imagine the US at least would give out grants and tax incentives to develop coal/fuel plants all over the place. If the US could vastly reduce it's dependency on ME oil, then it could vastly reduce it's presence there; pull the troops home, reduce diplomatic staffs, and generally let the countries there do as they please to each other....
 
Games theory and political attention

David Howery said:
looking beyond just the costs though, wouldn't the US/Europe have strong incentives to develop coal/fuel technology? Getting out of the morass of middle eastern politics would be hugely attractive. I'd imagine the US at least would give out grants and tax incentives to develop coal/fuel plants all over the place. If the US could vastly reduce it's dependency on ME oil, then it could vastly reduce it's presence there; pull the troops home, reduce diplomatic staffs, and generally let the countries there do as they please to each other....

Look at it from a games theory point of view. If the US had spent the money to build synfuel plants using the North Slope gas to make methanol to burn as auto fuel, the US would have spent the money and had methanol at the equivalent of 2$ per gallon of gasoline wholesale, or about the equivalent of 50$ per barrel for crude.
But the construction of these plants would diminish the US's consumption of oil. This would have reduced the world price demand for and the price of oil to the equivalent of 10$ per barrel, the point where the nonmiddle east off shore and small field producers gave up and the middle east was again was the major producer.
Since the US would no longer be importing oil that would not help us, but would help the other importers, such as Europe, Japan, China, India, the third world non oilproducers, Korea, Taiwan, etc. It would also have defunded the Russian 'menace' during the seventies and eighties.
While this would have allowed the US to skip out on defence costs of keeping Middle East oil secure and in diverse hands to reduce the possibility of a single country taking over and jacking the price up to the point where countries would go to war, this savings would have only come at the expense of the Military Industrial Complex. That is, my relatives. (At least, we were so employed during the seventies, the eighties, and the early nineties.)
Politically, taking the money away from Republican defence industry voting engineers and managers and giving it to Democratic voting union construction workers would have presented problems in getting campaign funds. It did not happen.
Now the development of corrosion and abrasion resistant Ti plating for heat exchangers technology makes coal cheaper than gas as a source for synfuels. This means that countries like China can build synfuel plants. The cost has come down to the point where it is cheaper than the present cost of oil. But not the possible future cost of oil, if the price collapses to the teens again.
So China has the option of just building coal mines and synfuel plants and not bothering to construct a large navy to guarantee imports of oil. They could just ignore the middle east. Of course, if you were the government of China, would you like to hand control of the economy to a bunch of coal miners that you don't control, or a navy that you do? England was in a similar situation in the late forties and early fifties. They build nuclear power plants at a higher cost than coal burning power plants just to make sure that the unions weren't going to control the economy. China may do the same.
 
I'm not following exactly what you're trying to say. I find it hard to imagine that this formula would come into being and we wouldn't take advantage of it. Are you saying that the setup costs would be too prohibitive? Certainly, anyone with investment capital would jump at the chance to invest in something like this... it's a guaranteed sale of product afterwards. Or, are you saying we would use it, but other buyers would jump in and buy ME oil so production wouldn't go down? I also don't see that this scenario would affect the military one way or the other, except for pulling out of the ME.... I suppose it could lead to cuts in defense spending, as we wouldn't be so frantic about our sources of oil...
just to clear this up, let us suppose that the formula comes into being and is available to the US... just what do you think would happen afterwards?
Incidentally, the book had the formula going to Israel... this would mean billions of dollars annualy for that nation. What'll happen to ME politics in the long run?
 
Actually I believe Japan does have substantial coal resources so they are exceedingly happy. :)

Not quite clear how Israel MAKES money off of the formula. Once they sell it, that's it. Anyone can use it and I would wager they don't even sell it. They build a pilot plant, prove its utility, and then just GIVE IT AWAY! After all, they just broke the Arabs one real source of power. Who needs more than that?
 
No, I don't think they'd just give it away... they'd patent it and lease it out to the industrialized nations... probably at pretty reasonable prices, or oil will still be attractive. Still, even at a bargain basement lease cost, Israel still is going to recieve billions of dollars a year.... what do you suppose they'll do with all that money? Finish the big wall first, I suppose.....
 
Japanese coal and Israeli economics

Grimm
Japanese coal is expensive and scarce. There isn't much of it, what is produced is subsidized to five times the world price.
Israel gets hard currency from several major sources. Two of these go away if the Arab oil cartel collapses. They don't get 'foreign aid' support from the US for keeping a large army to threaten the Arabs to prevent an embargo, and they don't get remittances from the Palestinians employed in the Gulf.
If oil prices collapse the Israeli engineers that produce the other third of their hard currency supply might get uppity and demand control of the government on the grounds that they are paying for it.
 
with the formula, Israel wouldn't need any outside aid... they'd have plenty on their own.. probably more than they can spend domestically... which makes you wonder just what they'd do with it all... give the Palestinians several billions to just all go away from the west bank? I suppose that probably wouldn't work, but it'd sure be a peaceful solution....
 
Israeli windfall

David Howery said:
with the formula, Israel wouldn't need any outside aid... they'd have plenty on their own.. probably more than they can spend domestically... which makes you wonder just what they'd do with it all... give the Palestinians several billions to just all go away from the west bank? I suppose that probably wouldn't work, but it'd sure be a peaceful solution....

Well, the inventors (the inventors have the patent rights) could just pay the Palestinians for their land, and houses, and orchards, and water rights, and back interest thereof, and they could spend as much money on the Palestinian schoolkids as the Israeli school kids, and as much social security money for the older Palestinian senior citizens as the Israeli senior citizens, and provide the same level of medical care, and parks, libraries, etc.
Boy, I bet that would really make a change in the way that the Palestinians looked at things.
 
well, technically the Nazis were the inventers. From what I remember of the book, the hero got the one and only written down version of the formula and in the end, he just gave it to Israel.. poetic justice, basically. The best scene in the whole book was when the big evil oil exec found out; he just couldn't comprehend it ("but they have nothing but oranges!").
With all those billions, Israel could certainly spend big chunks of it on the Palestinians. Let's assume this is after the '73 war, so that stumbling block is out of the way. Who's the Israeli PM in the late 70's? Begin? Is it likely he'd be willing to spend billions improving the Palestinians' lives?
 
Inventions and patent rights

David Howery said:
well, technically the Nazis were the inventers. From what I remember of the book, the hero got the one and only written down version of the formula and in the end, he just gave it to Israel.. poetic justice, basically. The best scene in the whole book was when the big evil oil exec found out; he just couldn't comprehend it ("but they have nothing but oranges!").
With all those billions, Israel could certainly spend big chunks of it on the Palestinians. Let's assume this is after the '73 war, so that stumbling block is out of the way. Who's the Israeli PM in the late 70's? Begin? Is it likely he'd be willing to spend billions improving the Palestinians' lives?

Patent rights (as distinguished from trade secrets) have ownership that is enforced by governments. If the Nazis had a secret like that, then it would presumably be divvied up by the Allies. That doesn't mean that the Chinese or the Indonesians (about to be importing oil instead of exporting it, and in possession of some of the finest low sulfur and ash coal in the world) or the South Africans or the Chileans or the Columbians or other coal mining countries would pay attention to it, just that we and the Europeans would.
So the Gypsies and the Serbs would get some long overdue reparations, but the Palestinians and the Israelis wouldn't get anything.
 
IIRC, the formula didn't fall into Allied hands because all records of it were destroyed, except for the one copy of it that the book's hero got ahold of... so, there is no provenance or records of ownership of it... there is literally the one copy only. Thus, if Israel gets ahold of it, there's nobody to dispute their ownership of it. It was a secret that only a bunch of ex-Nazi's knew about, until the big evil oil exec got wind of it somehow....
One weird idea I had with this scenario... if Israel had billions of dollars to solve the Palestinian problem, what would happen if they flat out bought all the acreage they could along the West Bank border and then gave the rest of the WB every modern convenience money could buy, as well as bestowing money on every Palestinian family... if this was done in the 70's, would the Palestinians be placated, more or less, or would they still be agitating for an independent state?
 
Machiavelli

What was it old Nicky said? 'A man will forgive the death of his father much more easily than the loss of his patrimony.' I think it's kind of a pun in Italian.
Also, the idea of a coal to oil catalyst isn't as stupid as it sounds. The problem with synfuels is that the sulfur in coal poisons the catalysts. If there was a catalyst that didn't bind to sulfur, perhaps because it was a sulfate, then it might work. Burn the coal to CO, H2, SO2, and then put it in supercritical CO2 with some funny catalyst? Might work well enough for Hollywood.
Make it supercritical SO3.
 
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