The Oil Drum | DrumBeat: September 25, 2008

258 comments on DrumBeat: September 25, 2008

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westexas on September 25, 2008 - 9:15am

Re: Russia wants to influence global oil price (linked uptop)

Energy Minister Sergei Shmatko: "The idea of mothballing oilfields seems very interesting to me."

http://www.theoildrum.com/node/2767
Net Oil Exports and the "Iron Triangle"
July 13, 2007

If one resides in the oil industry leg of the Iron Triangle, and if one has concluded that Peak Oil is upon us, or extremely close, does one say, "We cannot increase our production," and thereby encourage massive conservation and alternative energy efforts, or does one say "We choose not to increase production and/or we are temporarily unable to increase production for the following reasons (fill in the blank)?"

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tonyw on September 25, 2008 - 10:09am

Is there any reason why a country should not say in order to maximise our income over a longer period we are going to reduce our output?

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westexas on September 25, 2008 - 12:08pm

No, but the question is to what extent the reduced output is voluntary. Here are the actual EIA total liquids net export numbers for Saudi Arabia and my estimate for 2008:

2005: 9.1 mbpd
2006: 8.5
2007: 7.9
2008: 8.4*

*Estimated

The conventional wisdom is that almost all of this decline is voluntary. My contention is that most of the decline was involuntary. In any case, sometime next year, the cumulative shortfall between what Saudi Arabia would have exported at the 2005 rate of 9.1 mbpd and what they actually have exported will almost certainly exceed a billion barrels of oil.

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tonyw on September 25, 2008 - 2:52pm

So how much of a reduction would be needed to double the price? I would guess a reduction of less than half.

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258 comments on DrumBeat: September 25, 2008

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