Saudis fret as global thirst for oil grows

Ehh, the sooner we suck up all the oil the sooner we can move beyond oil...

 

<div class='quotetop'>QUOTE(bgdrewsif @ Apr 5 2006, 03:33 AM) [snapback]235189[/snapback]</div>

I used to feel this way to but with the growing signs of global warming cropping up everywhere I hope the world keeps increasing pressure on the major governments to make changes before we burn all the oil and the planet.

 

<div class='quotetop'>QUOTE(TonyPSchaefer @ Apr 5 2006, 11:42 AM) [snapback]235312[/snapback]</div>

Unfortunately I think you're absolutely correct.

 

Think of this, though. Current global demand is just about 85 million barrels/day. If China had an economy and consumption pattern to match they'd use 99 mb/day! We use 20 mb/day now and by 2025 that's expected to rise to 25 mb/day. Then throw in India and the rest of Asia and the pressure is so intense on the oil producers that they're not going to be able to keep up. Unless something radically new happens in the oil production technology, the price of oil is going to soar. That'll naturally mean alternatives will become cheaper by comparison. Demand for oil will decrease and some equilibrium will be established. However, at that point the momentum towards alternatives will be growing steadily and they will get cheaper. I agree that it's sad and lame that people have to act so foolishly and in the present all the time. A little bit of forward thinking would be nice (well, on the part of the average person that is).

 

I just finished reading a great book - "Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy". If you ever wanted to learn about what is involved in producing oil and the problems that are encountered, this is the book, and it's very understandable by a layman. It was written by Matthew Simmons, CEO of an investment bank that specializes in the energy industry. Based upon Society of Petroleum Engineer (SPE) papers presented at conferences, he gives a grim view of the future of Saudi oil production.
In a nutshell, he believes that Saudi production is past peak. Water cuts in the producing fields are averaging more than 35% and are increasing. Just keeping production constant requires dealing with ever increasing water production and ever larger separation facilities. Over production damages the wells by increasing water breakthroughs. According to him, and backed up by SPE papers and Saudi insider information, the 4 super giant oil fields (Ghawar, Safaniya, Abqaiq, and Berri) that account for the large majority of Saudi production are already in decline. There's no way that the Saudis can ramp up production to meet a significant increase in demand. The billions they are spending now are just an attempt to maintain production at current levels.
Unfortunately, the world believes that the Saudis can boost production just by opening the valves further.
Other reports I've read by other authors pretty much state that when Saudi oil peaks, world production peaks.

 

<div class='quotetop'>QUOTE(tomforst @ Apr 5 2006, 05:38 PM) [snapback]235513[/snapback]</div>

I read that one on the plane over to Europe and read it again on the return trip. Scary. Let's face it, we have no idea what Saudi reserves really are because that is one of their most closely guarded secrets.