It is being reported that Saudi Arabia's oil reserves may have been overestimated by as much as...
40%. This would mean that the consequences of Peak Oil are going to hit home (a lot) sooner rather than later. What impact is this going to have upon the prospect for growth in World economy - bearing in mind that Capitalism, and the Free Market, is entirely predicated upon growing populations, markets, production and consumption?
Well it's always the same, oil is rarer than we thought, prices explode. Oh no wait there's still more, we have found some in Alaska, prices relax. Oh darn not much oil here. Prices rise again
That's good old supply and demand economy (it's the same with diamonds, millions of them are stored underground in DeBeers facilities just to create the illusion that this pressed carbon/graphite is precious and expensive but you can find tons of 'em in every diamond mine )
Peak Oil was over as early as the 1970's. Saudi already pumping oil out by injecting water - and this is a desert!
" At Ghawar, the engineer said, the 'water cut' was 30%."
"The hairs on the back of my neck stood up. Ghawar's water injections were hardly news, but a 30% water cut, if true, was startling. Most new oilfields produce almost pure oil or oil mixed with natural gas--with little water. Over time, however, as the oil is drawn out, operators must replace it with water to keep te oil flowing --until eventually what flows is almost pure water and the field is no longer worth operating."
"Ghawar will not run dry overnight, but the beginning of the end of its oil is in sight." Paul Roberts, "New Tyrants for Old as the Oil Starts to Run Out, " Sunday Times (News Review), May 16, 2004, p. 8
I think this is one of those "planted" information stunts designed to drive the market spot price of oil up. Ultimately, the true availability of crude oil is a function of the production numbers...not the reserves. If the Saudis were diminishing production, then we would need to be ready for some problems. I am sure the Saudis will welcome the "rumor" as it will indeed create some concern in the markets and possibly some pricing spikes. In fact, I would not be surprised to find out that they are the ones who started the rumor in the first place. The Saudis are capable of producing just over 12 billion barrels of crude per day...they are only operating at 9 billion at the present so there is capacity to be used even within current production. In terms of reserves, most of that is an educated guess based on electronic soundings etc. from downhole logging. There is always room for some error there. WB
Sure; why else would the Saudis be pushing the US so hard to invade Iraq and Iran? You didn't think WE were going to get that oil did you?
King Abdullah is an a**hole who is going to lose his kingdom if he doesn't find oil reserves somewhere.
the problem with this is that it seems that every once in a while we hear stories like this and then the next thing we know , the price of fuel goes up. this seems like just that, an excuse to raise the cost of fuel. why they don't just tell us "too bad suckers were going to raise the prices because we can " is beyond me.
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by Aqeel Saeed 9 years ago
It fluctuate between $ 148 per barrel to $ 33 per barrel.
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Boehner says they have been working waaaaay too hard....time for another vaca.What do you say, $10,000 that they go to Tahiti?
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