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WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices: US diplomat convinced by Saudi expert that reserves of world's biggest oil exporter have been overstated by nearly 40%

The US fears that Saudi Arabia, the world's largest crude oil exporter, may not have enough reserves to prevent oil prices escalating, confidential cables from its embassy in Riyadh show.

The cables, released by WikiLeaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300bn barrels – nearly 40%.

The revelation comes as the oil price has soared in recent weeks to more than $100 a barrel on global demand and tensions in the Middle East. Many analysts expect that the Saudis and their Opec cartel partners would pump more oil if rising prices threatened to choke off demand.

However, Sadad al-Husseini, a geologist and former head of exploration at the Saudi oil monopoly Aramco, met the US consul general in Riyadh in November 2007 and told the US diplomat that Aramco's 12.5m barrel-a-day capacity needed to keep a lid on prices could not be reached.

According to the cables, which date between 2007-09, Husseini said Saudi Arabia might reach an output of 12m barrels a day in 10 years but before then – possibly as early as 2012 – global oil production would have hit its highest point. This crunch point is known as "peak oil".

Husseini said that at that point Aramco would not be able to stop the rise of global oil prices because the Saudi energy industry had overstated its recoverable reserves to spur foreign investment. He argued that Aramco had badly underestimated the time needed to bring new oil on tap.

One cable said: "According to al-Husseini, the crux of the issue is twofold. First, it is possible that Saudi reserves are not as bountiful as sometimes described, and the timeline for their production not as unrestrained as Aramco and energy optimists would like to portray."

It went on: "In a presentation, Abdallah al-Saif, current Aramco senior vice-president for exploration, reported that Aramco has 716bn barrels of total reserves, of which 51% are recoverable, and that in 20 years Aramco will have 900bn barrels of reserves.

"Al-Husseini disagrees with this analysis, believing Aramco's reserves are overstated by as much as 300bn barrels. In his view once 50% of original proven reserves has been reached … a steady output in decline will ensue and no amount of effort will be able to stop it. He believes that what will result is a plateau in total output that will last approximately 15 years followed by decreasing output."

The US consul then told Washington: "While al-Husseini fundamentally contradicts the Aramco company line, he is no doomsday theorist. His pedigree, experience and outlook demand that his predictions be thoughtfully considered."

Seven months later, the US embassy in Riyadh went further in two more cables. "Our mission now questions how much the Saudis can now substantively influence the crude markets over the long term. Clearly they can drive prices up, but we question whether they any longer have the power to drive prices down for a prolonged period."

A fourth cable, in October 2009, claimed that escalating electricity demand by Saudi Arabia may further constrain Saudi oil exports. "Demand [for electricity] is expected to grow 10% a year over the next decade as a result of population and economic growth. As a result it will need to double its generation capacity to 68,000MW in 2018," it said.

It also reported major project delays and accidents as "evidence that the Saudi Aramco is having to run harder to stay in place – to replace the decline in existing production." While fears of premature "peak oil" and Saudi production problems had been expressed before, no US official has come close to saying this in public.

In the last two years, other senior energy analysts have backed Husseini. Fatih Birol, chief economist to the International Energy Agency, told the Guardian last year that conventional crude output could plateau in 2020, a development that was "not good news" for a world still heavily dependent on petroleum.

Jeremy Leggett, convenor of the UK Industry Taskforce on Peak Oil and Energy Security, said: "We are asleep at the wheel here: choosing to ignore a threat to the global economy that is quite as bad as the credit crunch, quite possibly worse."

http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks
 

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So, now Obama is even a bigger idiot than we previously thought? No, that would be Salazaar, then OBama....it all plays into the green agenda doesn't it?

Suddenly ANWR and the Colorado shale fields seem very interesting...
 

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So, now Obama is even a bigger idiot than we previously thought?
If he was running around in an adult diaper, with a box of crayons, wearing a football helmet, with drool dripping of his chin, he couldn't be a bigger idiot than what I initially thought... :laughing:
 

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If he was running around in an adult diaper, with a box of crayons, wearing a football helmet, with drool dripping of his chin, he couldn't be a bigger idiot than what I initially thought... :laughing:

Thats what he is doing now, what about tonight? :D


Is the American public sleeping on this issue? where is the outrage, when gas goes to $5 a gallon its too late, our economy as we know it will be doomed, Somebody has to step up and get all the stupid regulations about drilling here reversed :lookinup:
 

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Sooner or later they will open those fields. When they can't get gasoline for their limos and jets, the environment will become less important.
 

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If he was running around in an adult diaper, with a box of crayons, wearing a football helmet, with drool dripping of his chin, he couldn't be a bigger idiot than what I initially thought... :laughing:
Ok, I'll say it...
He's not the village idiot,
he's not the town idiot,
he's not the city idiot,
he's not the county idiot,
he's not the state idiot,
he's not the national idiot,
he's not the international idiot,
he's the universal idiot.

I.E. he's achieved a state of nirvana with the progressives....he's equally idiotic to all.
 

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I don't believe this for a minute. The very week we lift this ridiculous moratorium on licensing... they will emphatically state that they have far more oil then originally assessed, do to new findings. OPEC's pricing structure is based upon quotas. The more oil you have... the more you can drill. By allowing a "WikiLeak" stating they have less then originally thought... they can drive the price up predicated upon supply and demand. Demand is low. How do you drive prices higher when the demand for your product is low ?

Pretty cool how we can neither confirm nor deny any of these WikiLeak's... huh ? It's also astonishing that no country, planet wide... will take it's creator to task and find out what is true and what is not... for spreading the most intimate secrets of all governments.
 

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I'm aware of how old that article is. If you would like something more updated you can search oil sands of Alberta or try this link.
http://www.energy.alberta.ca/OurBusiness/oilsands.asp
There is a lot of oil in the oil sands, but doesn't the price of oil have to be pretty high for it to be economically viable? I think it takes a lot of energy to extract the oil from the sand. Right?
 

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That's why I originally posted a link to the 60 Minutes article from 2006. It had more information. Here's a quote from the article:

"T. Boone Pickens, a legendary Texas oil tycoon, was working Alberta’s traditional oil rigs back in the '60s and remembers how he and his colleagues thought mining for oil sands was a joke.

"Here we are sitting there having a drink after work and somebody said this isn’t going to, it isn’t possible. It’ll all have to be subsidized to a level, said, before they’d make money you’d have to have $5 oil," Pickens says laughing. "We never thought it would happen."

But then $40 a barrel happened and the oil sands not only made sense, they made billions for the people digging them. But it wasn’t just the price of oil that changed the landscape, it was the toys. That’s what they call the giant trucks and shovels that roam the mines.
 

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That's why I originally posted a link to the 60 Minutes article from 2006. It had more information. Here's a quote from the article:

"T. Boone Pickens, a legendary Texas oil tycoon, was working Alberta’s traditional oil rigs back in the '60s and remembers how he and his colleagues thought mining for oil sands was a joke.

"Here we are sitting there having a drink after work and somebody said this isn’t going to, it isn’t possible. It’ll all have to be subsidized to a level, said, before they’d make money you’d have to have $5 oil," Pickens says laughing. "We never thought it would happen."

But then $40 a barrel happened and the oil sands not only made sense, they made billions for the people digging them. But it wasn’t just the price of oil that changed the landscape, it was the toys. That’s what they call the giant trucks and shovels that roam the mines.
Interesting. Something tells me $40 isn't enough these days, but since it's permanently near or above double that figure, I'm guessing that's enough.
 

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WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices: US diplomat convinced by Saudi expert that reserves of world's biggest oil exporter have been overstated by nearly 40%

The US fears that Saudi Arabia, the world's largest crude oil exporter, may not have enough reserves to prevent oil prices escalating, confidential cables from its embassy in Riyadh show.

The cables, released by WikiLeaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300bn barrels – nearly 40%.

The revelation comes as the oil price has soared in recent weeks to more than $100 a barrel on global demand and tensions in the Middle East. Many analysts expect that the Saudis and their Opec cartel partners would pump more oil if rising prices threatened to choke off demand.

However, Sadad al-Husseini, a geologist and former head of exploration at the Saudi oil monopoly Aramco, met the US consul general in Riyadh in November 2007 and told the US diplomat that Aramco's 12.5m barrel-a-day capacity needed to keep a lid on prices could not be reached.

According to the cables, which date between 2007-09, Husseini said Saudi Arabia might reach an output of 12m barrels a day in 10 years but before then – possibly as early as 2012 – global oil production would have hit its highest point. This crunch point is known as "peak oil".

Husseini said that at that point Aramco would not be able to stop the rise of global oil prices because the Saudi energy industry had overstated its recoverable reserves to spur foreign investment. He argued that Aramco had badly underestimated the time needed to bring new oil on tap.

One cable said: "According to al-Husseini, the crux of the issue is twofold. First, it is possible that Saudi reserves are not as bountiful as sometimes described, and the timeline for their production not as unrestrained as Aramco and energy optimists would like to portray."

It went on: "In a presentation, Abdallah al-Saif, current Aramco senior vice-president for exploration, reported that Aramco has 716bn barrels of total reserves, of which 51% are recoverable, and that in 20 years Aramco will have 900bn barrels of reserves.

"Al-Husseini disagrees with this analysis, believing Aramco's reserves are overstated by as much as 300bn barrels. In his view once 50% of original proven reserves has been reached … a steady output in decline will ensue and no amount of effort will be able to stop it. He believes that what will result is a plateau in total output that will last approximately 15 years followed by decreasing output."

The US consul then told Washington: "While al-Husseini fundamentally contradicts the Aramco company line, he is no doomsday theorist. His pedigree, experience and outlook demand that his predictions be thoughtfully considered."

Seven months later, the US embassy in Riyadh went further in two more cables. "Our mission now questions how much the Saudis can now substantively influence the crude markets over the long term. Clearly they can drive prices up, but we question whether they any longer have the power to drive prices down for a prolonged period."

A fourth cable, in October 2009, claimed that escalating electricity demand by Saudi Arabia may further constrain Saudi oil exports. "Demand [for electricity] is expected to grow 10% a year over the next decade as a result of population and economic growth. As a result it will need to double its generation capacity to 68,000MW in 2018," it said.

It also reported major project delays and accidents as "evidence that the Saudi Aramco is having to run harder to stay in place – to replace the decline in existing production." While fears of premature "peak oil" and Saudi production problems had been expressed before, no US official has come close to saying this in public.

In the last two years, other senior energy analysts have backed Husseini. Fatih Birol, chief economist to the International Energy Agency, told the Guardian last year that conventional crude output could plateau in 2020, a development that was "not good news" for a world still heavily dependent on petroleum.

Jeremy Leggett, convenor of the UK Industry Taskforce on Peak Oil and Energy Security, said: "We are asleep at the wheel here: choosing to ignore a threat to the global economy that is quite as bad as the credit crunch, quite possibly worse."

http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks
You guys just said there was enough oil on this rock to last centuries.

Make up your minds.
 

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You guys just said there was enough oil on this rock to last centuries.

Make up your minds.
LOL

Yup. In Iraq... Odd, they could not tell if they had SWMDs above ground, but we all know about the vast oil supplies under ground.

Hmmm...

Something is not adding up here, except at the gas pump, which I am OK with! Make them ****ers pay for our first war. The second one was for kicks.
 
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