Three Triggers for Higher Oil Prices

Kuwait’s giant Burgan oil field already peaked.

Reserves in Saudi Arabia’s humongous Ghawar field, which pumps roughly five million barrels of oil every day (meeting 6% of the world’s demand) are declining at 8% a year. In fact, Saudi oil production has been dropping since 2004. They say they’re cutting by choice. If the product you sold was going for record prices, would you cut production?

Closer to home, Mexico’s big oil field, Cantarell, peaked in 2004 at slightly over two million barrels per day. Since then, its production is down to just 1.6 million barrels per day. And in the next three years, Cantarell will produce less than half a million barrels per day, according to experts. Soon after that, Mexico will have to start importing oil.

MoneyandMarkets