I have to take anything the Saudis say about their oil reserves and capabilities with a grain of salt. Unlike Western energy MNCs, their reserves are
a state secret. There is no transparency.
We already know the Western MNCs have overstated their reserves before and been forced to lower them. The OPEC nations' reserves are all believed to
be inflated anyway since they allocate quotas by stated reserves.
It is in OPEC's interest to keep the world economy healthy, so demand doesn't drop. By admitting crippling shortfalls are on they way, they could
provoke a global recession, or at the very least a major investment in alternative fuel sources. It would be in their interest to extract as much
money as they can from their customers and concealing any future problems. Nations tend to act in their own interest.
It's also interesting to note that Saudi Arabia has reportedly been the largest buyer of solar panels in the world, and that they have also
reportedly wired their oil infrastructure with dirty bombs to prevent hostile take over. If cheap oil truly is running out, their highly concentrated
energy industry would be vulnerable to hostile take over. It's in their interest to lie and say everything is fine.
But can Saudi Arabia really meet global energy needs if we also factor in projected increase in demand as well as the depletion of existing fields?
Let's remember what Vice President Cheney said in 1999, when he was CEO of Halliburton:
"There will be an average of 2% annual growth in global oil demand over the years ahead, along with, conservatively, a 3% natural decline in
production from existing reserves. That means by 2010 we will need in the order of an additional
50 million barrels a day. This is
equivalent to more than six Saudi Arabia's of today's size."
Not long after Cheney would be in office as the Vice President, would launch an energy task force (which included Matt Simmons)...
The same Matt Simmons who has a book
out later this year,
"Twilight in the Desert", tackling this very issue of Saudi claims and the possibility that Saudi has or is close to peaking.
As to the comment above me, high prices can't be "blamed" on Saudis or the US oil companies or Bush or Terrorism or Yukos or anything else. Prices
are what the market will bear. If you must blame anything, blame an energy-intensive, constantly-expanding world economy and world population rather
foolishly built on a non-renewable, non-sustainable resource.
Half the pie is gone, and a lot more hungry customers just walked in the door. That's the problem.