"Saudi cant pump enough oil to keep prices down"

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http://www.tehrantimes.com/index_View.asp?code=235540

Saudi cannot pump enough oil to keep a lid on prices: WikiLeaks

The U.S. fears that Saudi Arabia, the world's largest crude oil exporter, may not have enough reserves to prevent oil prices escalating, confidential cables from its embassy in Riyadh show.

The cables, released by WikiLeaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300 billion barrels -- nearly 40 percent.

The revelation comes as the oil price has soared in recent weeks to more than $100 a barrel on global demand and tensions in the Middle East. Many analysts expect that the Saudis and their OPEC cartel partners would pump more oil if rising prices threatened to choke off demand.

However, Sadad al-Husseini, a geologist and former head of exploration at the Saudi oil monopoly Aramco, met the U.S. consul general in Riyadh in November 2007 and told the U.S. diplomat that Aramco's 12.5 million barrel-a-day capacity needed to keep a lid on prices could not be reached.

According to the cables, which date between 2007-09, Husseini said Saudi Arabia might reach an output of 12 million barrels a day in 10 years but before then -- possibly as early as 2012 -- global oil production would have hit its highest point. This crunch point is known as “peak oil”.

Husseini said that at that point Aramco would not be able to stop the rise of global oil prices because the Saudi energy industry had overstated its recoverable reserves to spur foreign investment. He argued that Aramco had badly underestimated the time needed to bring new oil on tap.

One cable said: “According to al-Husseini, the crux of the issue is twofold. First, it is possible that Saudi reserves are not as bountiful as sometimes described, and the timeline for their production not as unrestrained as Aramco and energy optimists would like to portray.”

It went on: “In a presentation, Abdallah al-Saif, current Aramco senior vice-president for exploration, reported that Aramco has 716 billion barrels of total reserves, of which 51 percent are recoverable, and that in 20 years Aramco will have 900 billion barrels of reserves.

“Al-Husseini disagrees with this analysis, believing Aramco's reserves are overstated by as much as 300 billion barrels. In his view once 50 percent of original proven reserves has been reached … a steady output in decline will ensue and no amount of effort will be able to stop it. He believes that what will result is a plateau in total output that will last approximately 15 years followed by decreasing output.”

The U.S. consul then told Washington: “While al-Husseini fundamentally contradicts the Aramco company line, he is no doomsday theorist. His pedigree, experience and outlook demand that his predictions be thoughtfully considered.”

Seven months later, the U.S. embassy in Riyadh went further in two more cables. “Our mission now questions how much the Saudis can now substantively influence the crude markets over the long term. Clearly they can drive prices up, but we question whether they any longer have the power to drive prices down for a prolonged period.”

A fourth cable, in October 2009, claimed that escalating electricity demand by Saudi Arabia may further constrain Saudi oil exports. “Demand (for electricity) is expected to grow 10 percent a year over the next decade as a result of population and economic growth. As a result it will need to double its generation capacity to 68,000MW in 2018,” it said.

It also reported major project delays and accidents as “evidence that the Saudi Aramco is having to run harder to stay in place – to replace the decline in existing production.” While fears of premature “peak oil” and Saudi production problems had been expressed before, no U.S. official has come close to saying this in public.

In the last two years, other senior energy analysts have backed Husseini. Fatih Birol, chief economist to the International Energy Agency, told the Guardian last year that conventional crude output could plateau in 2020, a development that was “not good news” for a world still heavily dependent on petroleum.

Jeremy Leggett, convener of the UK Industry Taskforce on Peak Oil and Energy Security, said: “We are asleep at the wheel here: choosing to ignore a threat to the global economy that is quite as bad as the credit crunch, quite possibly worse.”

(Source: The Guardian)
 
No one can pump enough when the price of a barrel of crude is not based on true supply and demand market forces.
 
There is no shortage of oil in the world but the days of cheap oil are gone.

I've always found it very curious that the US which is a net importer of oil has the lowest gasoline and oil prices of any developed country that I know of.
 
CATERHAM-i definetaly agree, I used to pay over $10 per gallon while I lived in Europe. My parents pay $9 per gallon and they live in Asia. Surprisingly, gas is dirt cheap in the States. No clue how that is the case!
 
Originally Posted By: FirstNissan
CATERHAM-i definetaly agree, I used to pay over $10 per gallon while I lived in Europe. My parents pay $9 per gallon and they live in Asia. Surprisingly, gas is dirt cheap in the States. No clue how that is the case!


Taxes. I know that motor fuels are heavily taxed in Europe, and this is likely the case for the country in which your parents live.
 
When oil gets excessive in price and their are shortages, China will be well positioned to handle the chaos. They've got lots of Nuclear Power Plants, Solar, Wind energy to step right in and handle the energy needs for the next generation.

They are stockpiling, (hoarding) as much natural resource's as they can now that the prices have been low. Wait until these resource's, like metals, start to deplete and see the price soar.
 
Originally Posted By: OilNerd
Originally Posted By: FirstNissan
CATERHAM-i definetaly agree, I used to pay over $10 per gallon while I lived in Europe. My parents pay $9 per gallon and they live in Asia. Surprisingly, gas is dirt cheap in the States. No clue how that is the case!


Taxes. I know that motor fuels are heavily taxed in Europe, and this is likely the case for the country in which your parents live.


And the Reason?
The cost of fuel is just the start, the more people burn it the more Roads, Parking, Congestion, Pollution and a population that depends on oil for transportation (add the cost of securing a source. Germany WWII)
 
http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks

Quote:
WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on pricesUS diplomat convinced by Saudi expert that reserves of world's biggest oil exporter have been overstated by nearly 40%




Something smells really rotten with this whole thing.
A U.S. diplomat sent the cables.
Could it be that the U.S. once burned by Wikileaks is now using them by "leaking" information that fits someone's agenda of making European gasoline prices a reality here in the U.S.?

I think we are being played like a cheap violin by the powers that be.
 
Originally Posted By: CATERHAM
There is no shortage of oil in the world but the days of cheap oil are gone.

I've always found it very curious that the US which is a net importer of oil has the lowest gasoline and oil prices of any developed country that I know of.


Not true. Everyone pays basically the same amount for gas, the difference is in gas taxes.
 
Originally Posted By: G-MAN
No one can pump enough when the price of a barrel of crude is not based on true supply and demand market forces.


You are absolutely right. The latest price run-up has nothing to do with supply and demand, and everything to do with specualtion and profiterring...
 
Originally Posted By: grampi
Originally Posted By: Torino
Originally Posted By: Shannow
Originally Posted By: Trav


I think we are being played like a cheap violin by the powers that be.


Ya reckon ?

http://af.reuters.com/article/energyOilNews/idAFLDE7260Y320110308
I sure 'reckon'. Remember that one of Bo-Jangles goals is $9/gal. gasoline for The U.S. John--Las Vegas.


Is Bo-Jangles from Iran?


i thought bojangles was a nasty chicken place
banana2.gif
 
Originally Posted By: Torino
Remember that one of Bo-Jangles goals is $9/gal. gasoline for The U.S. John--Las Vegas.


Who is Bo-Jangles, and where did he say he wanted a gallon of gas to cost $9?

Maybe he was talking about inflation. Since a half gallon of decent orange juice already costs $8, why should gasoline be less expensive. I suppose the low gas prices in the US are subsidized indirectly through excessive food prices. Bio fuels and ethanol drive up the cost of food. I don't know about you, but I'd rather see lower food prices and higher gas prices than the other way around.
 
Originally Posted By: FirstNissan
CATERHAM-i definetaly agree, I used to pay over $10 per gallon while I lived in Europe. My parents pay $9 per gallon and they live in Asia. Surprisingly, gas is dirt cheap in the States. No clue how that is the case!


Uh, that would be simple. Europe is a group of socialist countries. Asia is made up mostly of dictatorships. If you were to look at the taxes on their gas and oil compared to ours (which are far too high) you would see the difference. I would guess their rationed health care programs which are bankrupt and criminal make up the majority of the extra cost of gas. Then there are the castles the ruling class live in.

Our gas should be $1 a gallon and diesel should be .75 cents a gallon. Devaluation of the dollar and legislation designed to reduce the supply of oil in this country are the cause. Oil has been backing the dollar for decades so when the dollar goes down the oil goes up. The dollar has lost 90% of it's value since it was dreamed up in 1913 and recently it has lost even more of it's value with all the bailouts and TARP funding.

It's so easy to blame the oil companies and the "speculators" but there are many reasons our gas is more expensive than it should be and cheaper than other countries that are even more irresponsible and corrupt than the U.S. is. Anyone who thinks we should be paying 7-9 bucks a gallon for gas like they do elsewhere can move there and pay the $6-8 a gallon in taxes for social programs.

Why there are so many "Americans" who love to compare us to Europe I don't know. The point is, this isn't Europe and the closer it gets to Europe the worse off we become. Europe is a mess and copying their idiotic way of doing things is why we are in the mess WE are in.

If Europe is such a great place to live then everyone should move there. Personally, I think Europe is a joke as well a dictatorship just like most of the other countries so many want us to emulate. They didn't learn their lesson from the 20's and 30's because they are heading right back there again.

For the life of me I can't understand why so many want to follow their lead.
 
Originally Posted By: grampi
Originally Posted By: G-MAN
No one can pump enough when the price of a barrel of crude is not based on true supply and demand market forces.


You are absolutely right. The latest price run-up has nothing to do with supply and demand, and everything to do with specualtion and profiterring...


I beg to differ. It has everything to do with supply and demand and those who are profiting from this control the supply through our own congress and various environmental groups.

The "speculators" are just a propaganda tool that the MSM likes to pass off as the problem. There isn't any speculating going on. Those that are betting on oil going up are just your normal investor who can read the tea leaves OR those that control the supply and bought in just before they cut the supply. Just a few examples, shutting down the gulf and offshore drilling while limiting drilling on land.

"Speculators" is just a buzzword just like many other words and phrases that are used to bring in more revenue and have more control or make billions for the elites while everyone is looking where they want them to look instead of where the problem really is.

It's no different than "second hand smoke","climate change","war on drugs","war on terror" which are all money making/freedom reducing scams just like "energy crisis". All lies and all of it enables the government to raise taxes and take away freedom. It's really about control and very little else.

Devaluation of the dollar also plays a bigger role than just about everything else. It's a shame that so many don't understand the farce we have had for a monetary system for almost 100 years. The value of the dollar is controlled by how much they print and borrow or don't print and borrow. It's that simple.

Discussing oil prices is fruitless without discussing all the factors contributing to the rise in oil prices. A fiat currency which can be printed at will is one of the biggest, if not THE biggest problem.
 
I think we are being played like a cheap violin by the powers that be.

Yep! Business as usual. It could be that they stirred the pot in the middle east to start up that mess, closed down the gulf and offshore drilling so they can tack on another 3 or 4 bucks in taxes and use this mess they caused as an excuse.

The only problem is that will collapse the economy. A scenario some say is the ultimate goal.
 
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