Gulf states should reveal oil reserves

There are few more controversial figures in the oil industry than Matthew Simmons. Since the Houston-based banker argued the case for the peak or declining oil scenario in his 2005 book ‘Twilight in the Desert’ he has been at the centre of a storm that has had a real impact on the rising oil price.

If Simmons’ thesis is correct, then the oil-producing states of the Middle East are living on borrowed time. Even with the introduction of enhanced oil recovery (EOR) techniques, their fields are on the inexorable road to decline. The only question is how long the decline will take.


For Oman, it might not be very long at all. In 2001, Petroleum Development Oman was producing 800,000 barrels a day (b/d). Last year, despite the extensive introduction of new techniques, output averaged just 560,000 b/d. While new EOR technologies are rapidly being deployed in the sultanate, Simmons’ argument is that this can only delay the inevitable.

National oil companies (NOCs) say there is more than enough oil for production to be increased and sustained for decades. Not only does Simmons not have the expertise, they say, but he is also making assumptions without having access to the real data.

Middle East Business Intelligence