[agramante]

It seems to me that the Saudi definition of "spare capacity" has changed over the years. In the 80's, they dramatically slowed their extraction rate, partly to bolster prices, and partly to preserve their fields. Even despite the increasingly high water cut they were able to open the taps back up again and increase production in fairly short order--on a scale of days to weeks. Now, their definition of "spare capacity" involves bringing new wells on line within a few years. In other words, it's not spare at all. I think OPEC's current claims of spare capacity are fictitious. We have almost no way to confirm or deny their claims, but there is that remarks in the Wikileaks cache from a few years ago of the Saudi oil minister saying they were producing flat-out--something entirely at odds with the official line.

[Pops]

Actually I believe they converted a lot of fields to MRC wells.

And they have been producing around 10mmbopd since 2005 (except for the dip around 09) and only made that for perhaps a year in 79




But I'm interested in reading your source for believing they have no spare capacity. rocdoc says he thinks they did everything they had planned to make 12.5

[rockdoc123]

$this->bbcode_second_pass_quote('', 'N')ow, their definition of "spare capacity" involves bringing new wells on line within a few years. In other words, it's not spare at all.

[Keith_McClary]

$this->bbcode_second_pass_quote('rockdoc123', 'A')ll of the billions were spent on the megaprojects from 2006 - 2010 and after they were completed was when Saudi Arabia announced they had reached their goal of a 12.5 MMB/d spare capacity.

I don't think there is any reason to doubt their spare capacity as a volume.

[sparky]

.
Probably they did , but their production so far is holding , so one must look at this thing as a fact
they produce anything between 9 to 10 millions barrel per day and at a pinch could throw a couple millions more on the market .
a major concern is their internal consumption ,which is rising , relentlessly

Don't forget production is misleading , exports is the crux of the matter !

[Pops]

$this->bbcode_second_pass_quote('pstarr', 'I')t just seems to me (and my good friend Mr. Occam) that unless the answer it quite transparent, the methods reproduceable, and the theory testable (falsification and all that) then this over-capacity thing is much over-rated. I have to go with a world recession

[Pops]

Sorry I didn't lable it

But no that chart is IEA demand AKA consumption, still rising. It is not the same as production which is higher yet - leaving .... an oversupply. It doesn't matter how you frame it, consumption is higher than when China was growing over 10% and production is higher as well, just saying it isn't so changes nothing. Trot out some alternate authority that says consumption is declining otherwise you are just plugging your ears and chanting
"DoomDoomDoomDoom..."

That there is over production of oilish stuff right now, doesn't "debunk" PO any more that 150 years of increasing production did. Oil is still finite, it will still peak and it will still decline.

[ralfy]

We can probably see this in light of oil consumption for the U.S., EU, and Japan compared to the rest of the world:

http://ourfiniteworld.com/2013/04/11/pe ... e-problem/

and then wonder what would happen if both trend lines continue.

[dashster]

Publication is a about month away - July 31, 2015.

$this->bbcode_second_pass_quote('', 'I')n the last decade, oil experts, geologists, and policy makers alike have warned that a peak in oil production around the world was about to be reached and that global economic distress would result when this occurred. But it didn't happen. The "Peak Oil" Scare and the Coming Oil Flood refutes the recent claims that world oil production is nearing a peak and threatening economic disaster by analyzing the methods used by the theory's proponents. Author Michael C. Lynch, former researcher at Massachusetts Institute of Technology (MIT), debunks the "Peak Oil" crisis prediction and describes how the next few years will instead see large amounts of new supply that will bring oil prices down and boost the global economy.

This book will be invaluable to those involved in the energy industry, including among those fields that are competing with oil, as well as financial institutions for which the price of oil is of critical importance. Lynch uncovers the facts behind the misleading news stories and media coverage on oil production as well as the analytic process that reveals the truth about the global oil supply. General readers will be dismayed to learn how governments have frequently been led astray by seeming logical theories that prove to have no sound basis and will come away with a healthy sense of skepticism about popular economics.

[Keith_McClary]

$this->bbcode_second_pass_quote('dashster', 'P')ublication is a about month away - July 31, 2015.

[ennui2]

Michael Lynch wrote a lot of editorials around the 2008 oil panic days to try to debunk peak-oil. There may be a kernel of truth in what he's saying but he is a cornucopian and I would not expect the future of oil supply to turn out as rosy as he predicts (nor do I think it's as gloomy as peakers predict). The fact that he's writing an anti-peak oil book at a time when it's already fallen off the radar of public consciousness is all you need to know about the axe he has to grind. Apparently he feels the need to beat a horse that is already dead as far as the public is concerned.

[Pops]

Everyone has an ax to grind, a few get royalties, hard to imagine them changing axes.

[ROCKMAN]

Pops - "...hard to imagine them changing axes." So true but still amazing to watch them amass followers. So the world is saved because we've discovered a previously unknown source of oil (the Bakken and Eagle Ford Shale were first produced more then 50 years ago) that can now be exploited by the "few" techs of frac'ng (which started over 50 years ago), horizontal drilling (common over 20 years ago) and pad drilling (a concept developed many decades ago).

Obviously the "flood" will continue to wash over us at $60/bbl thanks to such "new" field discoveries and technologies. Thank Dog this biblical "flood" doesn't require high priced oil. LOL.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('ennui2', 'M')ichael Lynch wrote a lot of editorials around the 2008 oil panic days to try to debunk peak-oil. There may be a kernel of truth in what he's saying but he is a cornucopian and I would not expect the future of oil supply to turn out as rosy as he predicts (nor do I think it's as gloomy as peakers predict). The fact that he's writing an anti-peak oil book at a time when it's already fallen off the radar of public consciousness is all you need to know about the axe he has to grind. Apparently he feels the need to beat a horse that is already dead as far as the public is concerned.

[copious.abundance]

Here's a link to the book on Amazon. Order now and get your copy early!

http://www.amazon.com/The-Peak-Scare-Co ... 1440831866

I might read it myself.

[sparky]

.
the big known unknown is Iran , if they get back into the world market on any reasonable terms ,
they can crank up their production to 5 millions barrels a day within three years ,
without breaking a sweat
so what if the price tank to 50$ , do you see them doing any favor to the gulf sheiks ?? !!
they would be hungry for cash with the major international oil companies grovelling for access
( as they already do )

This would require some lifting of sanctions , the coming weeks are going to be fascinating
such an array of interests , such double speak , such diplomatic poker ,
I'm just creaming my pants

[sparky]

.
From the OPEC official site
http://www.opec.org/opec_web/en/data_graphs/330.htm

the Islamic Republic of Iran account for a whooping 157 Billions barrels of proven reserve
considering they got to 6 millions barrel/day before the revolution with a pretty fast rise ,
the kibosh on their exports , degradation of their industry through sanctions , and lack of modern drilling tech
it would seems the figure of 5 millions B/d is quite reasonable as a target