“If Iraqi [oil] production does not rise exponentially by 2015, we have a very big problem,” Fatih Birol, chief economist of the International Energy Agency, told the French newspaper Le Monde yesterday, “even if Saudi Arabia fulfills all its promises.”
“The numbers are very simple,” Birol continued, sounding a lot like our own Byron King. “Within five-10 years, non-OPEC production will reach a peak and begin to decline, as reserves run out. There are new proofs of that fact every day. At the same time, we'll see the peak of China's economic growth. The two events will coincide: the explosion of Chinese growth and the fall in non-OPEC oil production. How the oil world will manage to face that twin shock is an open question.”
“Very few experts would think that an ‘exponential’ rise in Iraqi oil production is within the realm of possibility over the next eight years,” responds Dan Amoss. And his Saudi oil production predictions are no rosier:
“Not only does Saudi Arabia publish questionable reserve numbers, but it also fails to mention the fact that most of what it has left is heavy, sour crude that hardly anybody wants. The Saudi oil minister has claimed over the past year that the country has a few million barrels per day of so-called spare production capacity, yet can’t find buyers for all its crude. Should this heavy, sour crude really be included in capacity if it’s impractical to refine? Perhaps this is why the Saudis are investing heavily in refineries. This trend has big financial implications for consumers of refined products like gasoline.”
“The numbers are very simple,” Birol continued, sounding a lot like our own Byron King. “Within five-10 years, non-OPEC production will reach a peak and begin to decline, as reserves run out. There are new proofs of that fact every day. At the same time, we'll see the peak of China's economic growth. The two events will coincide: the explosion of Chinese growth and the fall in non-OPEC oil production. How the oil world will manage to face that twin shock is an open question.”
“Very few experts would think that an ‘exponential’ rise in Iraqi oil production is within the realm of possibility over the next eight years,” responds Dan Amoss. And his Saudi oil production predictions are no rosier:
“Not only does Saudi Arabia publish questionable reserve numbers, but it also fails to mention the fact that most of what it has left is heavy, sour crude that hardly anybody wants. The Saudi oil minister has claimed over the past year that the country has a few million barrels per day of so-called spare production capacity, yet can’t find buyers for all its crude. Should this heavy, sour crude really be included in capacity if it’s impractical to refine? Perhaps this is why the Saudis are investing heavily in refineries. This trend has big financial implications for consumers of refined products like gasoline.”
No comments:
Post a Comment