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85 comments on Saudis announce oil production increases...again...and again...and again...
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85 comments on Saudis announce oil production increases...again...and again...and again...
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What I found interesting is that the King put current production at 9.0 mbpd (C+C presumably), when the media has been claiming 9.45 mbpd.
I've become of the opinion that there is a cultural difference at work here. While we attach more importance to the accuracy/precision of a number, the Saudis (at least the ruling class) focuses more on the symbolic value. Thus the tendency to always allot additional increments in blocks of 100,000 bpd. Call it creative rounding.
The King wants to emphasize the generosity of the increase. Therefore round down (way down) the current production to 9, round up the new production level to the nearest 100,000 increment, and call it good. Another twist is to backdate the starting production value and really come up with an impressive increase. Or, just muddle everything by using flexible definitions of what oil is, or what "capacity" means.
Oh please! Or with all due respect, I respectfully disagree.
Yes there are cultural differences but the nice thing about numbers is that they are universal and 2+2 always equals 4, in every culture.
The difference you are observing is the difference between a desire for accuracy and need to obscure accuracy, not the inability to understand it or achieve it in universally accepted terms.
It is actually insulting, not "understanding", to suggest that the Saudis don't understand what accuracy and openness is because of their culture. Let's all start from the assumption that they understand the reality of the situation as well or better than we do.... In that context we can interpret their statements to mean that they have an interest in obscuring what they know, and reducing the certainty of buyers about the reality of their production capacity.
Westerners aren't the only ones who can do math, oil field engineering, or economic projections.
I'm not questioning their ability to do math, or applying it functionally. You are essentially saying the same thing that I am, but maybe putting more of a value judgment on their obfuscation of the data. All cultures have their own way of twisting numbers to obscure reality. I just think that theirs is different from ours. The disjoint between production figures reported by different levels within Saudi Aramco and by the ruling class to me suggests something more than carelessness.
In any case, a value of 9 mbpd for current production should not be taken seriously.
We can apply the same logic to Washington, can't we?
The King wants to emphasize the generosity of the increase.
Either way, we need to stick to a consistent metric. If we haven't taken them at their word in the past - when they said they were producing more - why should we if they say they are producing less? If we like the IEA metric or the OPEC metric or the EIA metric, we need to stick with it. Otherwise, we can mix and match metrics and come up with funny answers.