[N8 v2.0]

Saudi Oil Exec: Only 18% of World's Crude Reserves Tapped
Associated Press | Wednesday, September 13, 2006

VIENNA, Austria — The world has tapped only 18 percent of the total global supply of crude, a leading Saudi oil executive said Wednesday, challenging the notion that supplies are petering out.

Abdallah S. Jum'ah, president and CEO of the state-owned Saudi Arabian Oil Co., known better as Aramco, said the world has the potential of 4.5 trillion barrels in reserves — enough to power the globe at current levels of consumption for another 140 years.

Jum'ah challenged oil ministers and petroleum executives at an OPEC conference in Vienna to step up exploration "and leave the minimum amount of oil in the ground."

"The world has only consumed about 18 percent of its conventional potential," Jum'ah said, contending that should lay to rest fears that the world is in danger of being tapped out within a few decades.

Many experts estimate that the planet's recoverable oil resource is at least 3 trillion barrels and potentially more than 4 trillion barrels. If global consumption rises about 2 percent a year from today's levels of about 85 million barrels a day, they say, the low end of that range would only be enough to last until roughly 2070.

Rex W. Tillerson, the chairman of Exxon Mobil Corp. (XOM), said world demand for oil will increase by 50 percent in the next decade.

"When nations threaten to stop this flow, it stops economic progress worldwide," Tillerson said.

Industry leaders have gathered this week to take stock of new challenges at the conference sponsored by the Organization of Petroleum Exporting Countries.

Earlier this week, the 11-nation cartel agreed to leave its current production target of 28 million barrels a day unchanged, but made clear it would keep close tabs on falling oil prices and consider a possible cut in its output quota before the end of the year.

Crude prices have tumbled to five-month lows and have dropped by more than $12 a barrel since hitting record highs in mid-July. Analysts say a combination of ample supplies and an easing of political tensions such as the cessation of hostilities in Lebanon and progress in talks on Iran's suspect nuclear program have driven prices lower.

"When prices are high, passions can run high," Tillerson said. "Economic nationalism may gain in popularity" at the expense of developing global markets and the world economy, he said.

"The new era we face, like all of the previous ones, is not an era of easy oil — nor will it be an era of easy answers. But it can be an era of continued economic advancement," he said.

Jum'ah challenged explorationists to find enough new oil resources to add 1 trillion barrels to world reserves over the next 25 years, saying new technology and higher recovery rates would make it possible to hit that target.

Already, he noted, drilling is now going on as deep as 10,000 feet below the Gulf of Mexico and 7,000 to 8,000 feet elsewhere. Experts say a newly discovered petroleum pool beneath the Gulf of Mexico eventually could yield anywhere from 3 billion to 15 billion barrels.

 

[JohnE]

And? You cant trust the Saudis in the first place, and the future of energy is in renewable sources, like wind and solar. There is a finite amount of dead dinosaurs under the Earth, and when the sun burns out, and the wind stops blowing, we are done anyway...
Screw the money grubbing cant defend themselves dont want to shower men are for pleasure women for procreating camel riding ungrateful bastidges...

 

[macko]

Well of course that's what a Saudi oil exec is going to say! If he were to admit that there were only say, 8 years of crude oil remaining can you imagine how quickly car manufacturers and energy producers would scramble to engineer new technologies that wouldn't require the use of oil?

The first one out with said technology would be a sure-hit billionaire and oil producing nations such as Saudi Arabia would essentially go bankrupt within the decade.

He has no idea how much oil is left, no more than any other scientist in the world.

 

[N8 v2.0]

Damn those scientists that won't drink the Kool Aid!!!


http://hosted.ap.org/dynamic/stories/M/MAJOR_OIL_DISCOVERY?SITE=7219&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2006-09-05-08-28-12

 

[Silver]

N8, of course, it too dumb to read anything beyond a headline.

Abdallah S. Jum'ah, president and CEO of the state-owned Saudi Arabian Oil Co., known better as Aramco, said the world has the potential of 4.5 trillion barrels in reserves — enough to power the globe at current levels of consumption for another 140 years.


I bolded the important parts of that quote. Barring a massive reduction in the use of oil by the United States and a plague that wipes out the populations of China and India, current levels of consumption aren't going to hold.

A quick analogy works here: When I had surgery, I got an RX for Vicodin. At my rates of consumption, the bottle of pills lasted 5 or 6 days. Now, if Rush Limbaugh had come to visit (This would be China and India continuing to industrialize, N8) that same bottle of pills would have lasted 5 or 6 hours.

 

[rockwool]

When that oil has finaly ran out there are going to be some huge empty spaces that sure not going to help the movements of the different continental land masses...

 

[N8 v2.0]

When that oil has finaly ran out there are going to be some huge empty spaces that sure not going to help the movements of the different continental land masses...

Not to worry, the voids will be more than filled with the drivel you post here.

 

[Transcend]

When that oil has finaly ran out there are going to be some huge empty spaces that sure not going to help the movements of the different continental land masses...

Naw, the republicans are going to fill it with all of their hot air.

 

[rockwool]

Lets make it a joint venture to save the world..

 

[Zark]

.....Screw the money grubbing cant defend themselves dont want to shower men are for pleasure women for procreating camel riding ungrateful bastidges...

Next time try some commas, they make racially degrading rants better!

 

[stevew]

A quick analogy works here: When I had surgery, I got an RX for Vicodin. At my rates of consumption, the bottle of pills lasted 5 or 6 days. Now, if Rush Limbaugh had come to visit (This would be China and India continuing to industrialize, N8) that same bottle of pills would have lasted 5 or 6 hours.

Signature material, but it is to long.

 

[sanjuro]

This is the first positive story from an Arab that N8 has ever posted.

 

[Old Man G Funk]

Damn those scientists that won't drink the Kool Aid!!!


http://hosted.ap.org/dynamic/stories/M/MAJOR_OIL_DISCOVERY?SITE=7219&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2006-09-05-08-28-12

Again, in the N8 can't read beyond the headline category:

But the vast oil deposit roughly four miles beneath the ocean floor won't significantly reduce the country's dependence on foreign oil and it won't help lower prices at the pump anytime soon, analysts said.

Yeah, this has about 3 to 15 billion barrels of oil in it. At current consumption levels this amount of oil could keep the US going for less than 3 years (we consume about 5.7 bn barrels a year, which was also in the article.)

 

[MMike]

dumber than dirt he is....N8 that is.

 

[ALEXIS_DH]

when i read that production quotas are linked to declared reserves by each state, it changed my perseption a lot.

plus, from the TOTAL reserves, what % is pumpable? and in turn, from this, what % is economically feasible to be pumped?

 

[N8 v2.0]

Analyst predicts plunge in gas prices
By Kevin G. Hall
McClatchy Newspapers

WASHINGTON — The recent sharp drop in the global price of crude oil could mark the start of a massive sell-off that returns gasoline prices to lows not seen since the late 1990s — perhaps as low as $1.15 a gallon.

"All the hurricane flags are flying" in oil markets, said Philip Verleger, a noted energy consultant who was a lone voice several years ago in warning that oil prices would soar. Now, he says, they appear to be poised for a dramatic plunge.

Crude-oil prices have fallen about $14, or roughly 17 percent, from their July 14 peak of $78.40. After falling seven straight days, they rose slightly Wednesday in trading on the New York Mercantile Exchange, to $63.97, partly in reaction to a government report showing fuel inventories a bit lower than expected. But the overall price drop is expected to continue, and prices could fall much more in the weeks and months ahead.

Here's why:

For most of the past two years, oil prices have risen because the world's oil producers have struggled to keep pace with growing demand, particularly from China and India. Spare oil-production capacity grew so tight that market players feared that any disruption to oil production could create shortages.

Fear of disruption focused on fighting in Nigeria, escalating tensions over Iran's nuclear program, violence between Israel and Lebanon that might spread to oil-producing neighbors, and the prospect that hurricanes might topple oil facilities in the Gulf of Mexico.

Oil traders bet that such worrisome developments would drive up the future price of oil. Oil is traded in contracts for future delivery, and companies that take physical delivery of oil are just a small part of total trading. Large pension and commodities funds are the big traders and they're seeking profits. They've sunk $105 billion or more into oil futures in recent years, according to Verleger. Their bets that oil prices would rise in the future bid up the price of oil.

That, in turn, led users of oil to create stockpiles as cushions against supply disruptions and even higher future prices. Now inventories of oil are approaching 1990 levels.

But many of the conditions that drove investors to bid up oil prices are ebbing. Tensions over Israel, Lebanon and Nigeria are easing. The hurricane season has presented no threat so far to the Gulf of Mexico. The U.S. peak summer driving season is over, so gasoline demand is falling.

With fear of supply disruptions ebbing, oil prices began sliding. With oil inventories high, refiners that turn oil into gasoline are expected to cut production. As refiners cut production, oil companies increasingly risk getting stuck with excess oil supplies. There's already anecdotal evidence of oil companies chartering tankers to store excess oil.

All this is turning financial markets increasingly bearish on oil.

"If we continue to build inventories, and if we have a warm winter like we had last winter, you could see a large fall in the price of oil," said Gary Pokoik, who manages Hedge Ventures Energy in Los Angeles, an energy hedge fund. "I think there is still a lot of risk in the market."

As it stands now, the recent oil-price slump has brought the national average for a gallon of unleaded gasoline down to $2.59, according to the AAA motor club. In the Seattle area, prices per gallon have fallen to $2.856 currently from $3.071 a month ago, a decline of 7 percent, according to AAA.

Should oil traders fear that this downward price spiral will get worse and run for the exits by selling off their futures contracts, Verleger said, it's not unthinkable that oil prices could return to $15 or less a barrel, at least temporarily. That could mean gasoline prices as low as $1.15 per gallon.

Other experts won't guess at a floor price, but they agree that a race to the bottom could break out.

"The market may test levels here that are too low to be sustained," said Clay Seigle, an analyst at Cambridge Energy Research Associates, a consultancy in Boston.

On Monday, the oil-producing cartel OPEC hinted that if prices fall precipitously, OPEC members would cut production to lift them. But that would take time.

"That takes six to nine months. If we don't have a really cold winter here [creating a demand for oil], prices will fall. Literally, you don't know where the floor is," Verleger said. "In a market like this, if things start falling ... prices could take you back to the 1999 levels. It has nothing to do with production."

 

[ohio]

Perfect time to institute a (real) gas tax to start paying for this damn war, and some alternative energy before the price shoots up again.

 

[dante]

$1.15/gallon? ahahahahahahahahahahahahaha. Oil "fell" from $75 to 64. I can remember when Opec was trying to hold prices between $22 and 27/barrel, and it still wasn't $1.15/gallon then, either. Gas here is at 2.69/gallon, and I'll be shocked if it falls back to $2. Didn't last year, doubt it will this year either....

 

[Ciaran]

Perfect time to institute a (real) gas tax to start paying for this damn war, and some alternative energy before the price shoots up again.

We're taxed to death as it is! Maybe they should start making the corporations and richies pay their share instead of constantly taking from the middle class. I'm tired of new taxes to pay for Senator ****wads raise.

 

[Transcend]

Gas finally dropped back to under $1 a litre here (has been as high as $1.28). I sincerly doubt you will see anything like 1.15 a gallon, it is still well over $2.50 most places in the US, and it hasn't been a 1.15 in probably 15 years. When I lived in Co 8 years ago it was already $1.35.

 

[ohio]

We're taxed to death as it is! Maybe they should start making the corporations and richies pay their share instead of constantly taking from the middle class. I'm tired of new taxes to pay for Senator ****wads raise.

You're right. You are. Good thing we provided a bunch of tax cuts to the mega rich these last few years. It will really help them float through the hard times...

 

[N8 v2.0]

Gas finally dropped back to under $1 a litre here (has been as high as $1.28). I sincerly doubt you will see anything like 1.15 a gallon, it is still well over $2.50 most places in the US, and it hasn't been a 1.15 in probably 15 years. When I lived in Co 8 years ago it was already $1.35.

So now you are gasoline trading 'expert' too now eh..???



We were paying less than $1.00/gal at the pump 8 years ago here.... from Jul 98 - Apr 99 we got as low as $0.83/gal

 

[gsweet]

alright, i generally just read through the posts and whatnot at RM and enjoy the clashing of multiple perspectives, but i feel i should say something here. geology major, just finished an overseas bit which included petroleum resource studies. yes, there's a lot of oil left in earth's crust. no, it is not profitable to acquire. keep in mind that earth's crust ranges from 5 to 100 something kilometers thick and that most petroleum formations are created when organic materials are subjected anoxically to extreme temperature and pressure over time...this situation occurs fairly far beneath earth's surface. ya'll see what i'm getting at here? yea, there's a lot of oil left, but it is in no way profitable to extract oil that is 25 km below some passive continental margin.

 

[ALEXIS_DH]

plus, from the TOTAL reserves, what % is pumpable? and in turn, from this, what % is economically feasible to be pumped?

i wondered that too.
anybody has hard data on resrves sorted by production/feasibility costs?

 

[blue]

alright, i generally just read through the posts and whatnot at RM and enjoy the clashing of multiple perspectives, but i feel i should say something here. geology major, just finished an overseas bit which included petroleum resource studies. yes, there's a lot of oil left in earth's crust. no, it is not profitable to acquire. keep in mind that earth's crust ranges from 5 to 100 something kilometers thick and that most petroleum formations are created when organic materials are subjected anoxically to extreme temperature and pressure over time...this situation occurs fairly far beneath earth's surface. ya'll see what i'm getting at here? yea, there's a lot of oil left, but it is in no way profitable to extract oil that is 25 km below some passive continental margin.

Exactly.
In addition to this issue, many of the largest oil fields in the world are in less than hospitable areas where it's either impossible to get to or unprofitable to do so (ala Siberia).

Doesn't matter how much ****ing oil we have if we can't touch it.

N8, crawl back in your insulated hole. Dumbass is right about the prices though...I remember when gas was around .80 cents a gallon in the mid to late 90s.

 

[Transcend]

So now you are gasoline trading 'expert' too now eh..???



We were paying less than $1.00/gal at the pump 8 years ago here.... from Jul 98 - Apr 99 we got as low as $0.83/gal

I bet it was that low in Texas and Venezuela as well. See a correlation there, Mr Smart guy? Just as Hawaii is no way to judge high average prices, texas and louisiana are no way to judge low average gas prices.

Your title is indeed fitting.

 

[rockwool]

We're taxed to death as it is! Maybe they should start making the corporations and richies pay their share instead of constantly taking from the middle class. I'm tired of new taxes to pay for Senator ****wads raise.

Hey, no whining! You make some contributions to your congressmen that are bigger than the ones companies give and you will have your voice heard! Otherwise do like Ann Coulter and shut the fupp uck.

Gas finally dropped back to under $1 a litre here (has been as high as $1.28). I sincerly doubt you will see anything like 1.15 a gallon, it is still well over $2.50 most places in the US, and it hasn't been a 1.15 in probably 15 years. When I lived in Co 8 years ago it was already $1.35.

Just so that you guys get a perspective on things, gas prices are right now at $1,48 for one litre in Stockholm...

 

[Transcend]

Hey, no whining! You make some contributions to your congressmen that are bigger than the ones companies give and you will have your voice heard! Otherwise do like Ann Coulter and shut the fupp uck.



Just so that you guys get a perspective on things, gas prices are right now at $1,48 for one litre in Stockholm...

Yup, gas in Europe is super high - but it always has been. Gas here has just started to jump over the last 2-3 years. People are still dumbfounded.

Also, gas in Quebec in particular is taxed out the ass (same for in Europe). The funny part is that Quebec has about the worst roads I have ever ridden on.

 

[N8 v2.0]

Time to buy that H2!


Why $1.15 gas isn’t a fantasy
http://articles.moneycentral.msn.com/Investing/CNBC/Dispatch/LowGasolineMaybe.aspx

Sure, it sounds far-fetched, but the pieces are starting to fall into place for what could be a dramatic drop in oil prices over the next few years.

Remember when you paid $1.15 a gallon for gasoline?

You could be paying it again. Maybe not this year, but perhaps in the next few years.

Sure, oil experts say there's little excess refining capacity. Oil reserves are stretched. Oil consumption is soaring in China and India.

But things are starting to change. Drivers are changing their habits. Global tensions are easing, and more supply is on its way.

Crude oil zoomed to nearly $80 a barrel this summer as traders fretted about waning supplies and two big potential problems: tensions over Iran's nuclear research program and Katrina-style hurricanes threatening oil production in the Gulf of Mexico.

To keep prices moving ever higher, traders needed -- and frequently got – a steady stream of bad news. "It was like you needed a fifth of booze a day to keep the buzz going," says Peter Beutel of Cameron Hanover, a Connecticut energy consulting firm.

But prices began falling a month ago when it became clear hurricane season wouldn't be anything like last year. Oil traders have come to sense, too, that all the saber rattling over Iran was dissipating. "We got everyone leaning the wrong way," Beutel said.

(In fact, a big hedge fund was forced to tell its investors this week that it would be taking a huge loss because it bet the wrong way on natural gas.)

Result: The spot price of crude oil closed at $63.23 a barrel in New York on Thursday, down nearly 18% from a peak of $77.03 a barrel on July 14. Crude rallied slightly on Friday and Monday.

AAA says the national average price of gasoline is $2.495 a gallon, down nearly 17% from peaks in August, and there are some communities in Missouri where it has fallen under $2 a gallon. Prices should moderate further in the coming weeks because the summer driving season is over.

The oil price break has forced everyone in the energy business to take a hard look at how much lower prices could fall. A lot lower, says Philip Verleger, a noted energy consultant who was a lone voice several years ago in warning that oil prices would soar. Indeed, he told McClatchy Newspapers last week, "All the hurricane flags are flying" in oil markets.

If everything falls into place, crude could drop perhaps even to $15 a barrel, Verleger says. And then, he says, you would see gasoline at $1.15. Here's how that could occur.

Oil and gasoline inventories continue to grow. They've been building up all over the world as users and refiners have scrambled to ensure enough supply in case, say, the Strait of Hormuz in the Persian Gulf is shut down. Tankers from Iran, Saudi Arabia, Kuwait, Iraq and Gulf oil producing countries must pass through the strait to bring crude oil to the rest of the world.

The weather cooperates. On top of a hurricane with few threats to the oil and gas fields in the Gulf of Mexico, weather cooperation means a warm winter like the winter of 2005-2006. That would drop demand for heating oil, a key heating source especially on the East Coast and in Europe. And that would create excess supplies of crude that refiners could use to make gasoline.

Tensions in the Middle East continue to ease. This assumes conflicts between Israel and Hezbollah in Lebanon tail off and that Iran and the rest of the world come to an agreement over Iran's nuclear program. (Admittedly, the latter is a reason why the scenario could fall apart.)

Drivers take the bus. There is anecdotal evidence that U.S. drivers are finding other ways to get around with gas prices above $3. The big question is if they will they climb back behind the wheel as prices drop.​

Those four pieces are just the start. Beutel thinks two more catalysts are starting to emerge.

1. At current prices, Beutel says, "you can drill a lot of dry holes before you give up on a field." And so, drawn by the potentially huge profits, energy companies are finally starting to make plans to drill for more oil.

Example: the Jack 2 field in the Gulf of Mexico now being developed by Chevron (CVX, news, msgs), Devon Energy (DVN, news, msgs) and Norway's Statoil (STO, news, msgs). While the field is 7,000 feet under water and another 20,000 feet under the ocean floor, it's also huge. One report suggested it could boost current U.S. reserves by 50%.

Cambridge Energy Research Associates says some 360 additional drilling projects are now under way and global supplies could grow by some 25% by 2015.

2. Beutel thinks buyers are already demanding more fuel-efficient vehicles. "They're not buying SUVs," he says.

Not now anyway. But don’t write the Hummer’s obituary just yet. Beutel thinks that, at some point, prices will drop so low that Americans will get complacent and start driving big gas-guzzlers again. And the cycle will turn.