[extropy-chat] PHREAK OIL: Saudi says they have more than we need...

[Mike Lorrey]

--- Hal Finney <hal at finney.org> wrote:

> The book that claims the Saudis are close to peaking in their oil
> production is Twilight in the Desert by Matt Simmons.  I haven't read
> it but I'm not sure how credible it can be; the Saudis are
> notoriously secretive about the details of their oil operations.
> 
> The big thing I don't understand is why, if Saudi Arabia is in fact
> close to reaching a peak in its oil production, it would want to lie
> about it and claim that it can continue to increase. Credible news
> of a Saudi peak would drive up oil prices as the prospect of near-
> future shortages becomes more likely. This would put money in the
> Saudis' pockets! By lying about it, the Saudis are keeping oil
> prices low and making sure that they don't make as much money as
> they could.
> 
> I like a good conspiracy as much as the next guy, but don't
> conspirators usually aim to make money rather than lose it?
>  "Come on, guys, here's
> our big secret plan to find a new way to lose money!"  It's hard for
> me to see the reasoning behind why the Saudis would do this.
> 
> If anything, I'd expect them to be tempted to constantly invoke the
> spectre of possibly running out in the near future.  Then they would
> keep pushing the date out, to keep the tension high and keep prices
> as high as possible.  But they certainly aren't doing any such thing,
> as the article Mike quoted shows.

It appears to me exactly as the Saudis state it: our high prices here
in the US are the result of a lack of refinery capacity to refine sour
crudes. Sweet crudes come from three locations (other than domestic
wells): Venezuela, Nigeria, and the North Sea, with some coming on line
from Russia. Saudi Arabia can do little to reduce gas prices here
unless we expand that capacity, although they are building their own
refineries there, which likely will help.

Venezuela, obviously, is intent on pushing prices as high as possible.
Hugo Chavez has bought enough infantry equipment for ten times as many
troops as his government has enlisted, plus 50 Migs, helicopters, and
is expanding the navy. Despite claims when he nationalized Venezuela's
oil industry that the proceeds would be to feed the poor, he is
spending his gains on a massive military buildup and needs prices as
high as possible, so he is purposely eliciting US perceptions of
venezuelan instability in order to bid up market prices.

Nigeria has suffered sabotage to its refinery capacity at the hands of
muslim guerrillas. Little mention has been made of this groups ties to
al Qaeda.

Europe is keeping as much of its north sea capacity for itself and is
not developing any unexplored reserves. You've all heard my talk about
the Club of Rome's malthusian plans, so I'll spare you this time.

Mike Lorrey
Vice-Chair, 2nd District, Libertarian Party of NH
"Necessity is the plea for every infringement of human freedom.
It is the argument of tyrants; it is the creed of slaves."
                                      -William Pitt (1759-1806) 
Blog: http://intlib.blogspot.com


	
		
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