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Oil Price

Oil crunch delayed by 11 days since Oilympic peak in July 2008

fig_1d_2009_09_saving It’s very easy to calculate. The monthly oil peak was in July 2008 at 74,735 mb/d of crude oil. The average during an 8 month period preceding that spike was 74 mb/d.

Since then, production dropped by an average of 1.6 mb/d over a period of 14 months. Compared to an assumed level of 74 mb/d this gives a total “saving” of 656 mb up to September 2009, the latest month data are available from the EIA (International Petroleum Monthly). In the graph to the left the area of saving is marked in white.

That is equivalent to 9 days of global production or 0.64 days per month. Assuming that nothing will change much up to the end of the year the oil crunch will have been delayed by around 11 days.

We can see that an uptick in production of the growing group has been cancelled out by the declining group. Omitting Saudi Arabia and Angola, a new OPEC member, the underlying peak was around 2005/2006

In an update to the Dubai story, here is another interview

7/12/2009  Max Keiser on the real deal

Q: Why should Abu Dhabi bail out Dubai?
Max:  That’s where it’s getting very interesting.  There is a political element here. Because Dubai is sympathetic to the interests of Iran and Abu Dhabi is sympathetic to the interests of Saudi Arabia. And Abu Dhabi was not all too happy with the way Dubai was entertaining the Iranians and also there is tremendous amount of  commerce that goes through Dubai as away to go around the trade restrictions on Iran. So Abu Dhabi, in a way, as an opportunity to shut down the trade between Dubai and Iran on a purely political level. So there are the political motives not to help Dubai and they have an economic motive not to help Dubai because there is no reason to chase good money after bad.

Q: Will Dubai go bust or will it be saved?
Max: ……One thing Dubai is relying on going forward to finance themselves and the region of course are their oil reserves ..but my sources in Saudi Arabia tell me that the Ghawar oil field, for the past 3 years, has shown 10% production decline. That’s on top of the declines in Kuwait and the production declines in the Cantarell field in Mexico. So the world has hit peak oil. And what is the Middle East gonna be like without cheap oil  and this is another part of the story.

http://www.youtube.com/watch?v=LUVedkKtCIo&feature=player_embedded

SAUDI-OIL-COMMODITIES max_keiser_looking_for_missing_oil Already in early 2008, Max was looking for Saudi’s missing oil (up, left)

http://www.youtube.com/watch?v=-sYLFqg2e3I

It’s in Khurais, stupid (up, right). No, this is not a new shopping centre. It’s an oil factory:

Saudi Khurais Field: Looks Like Easy Oil May Be Gone from Arabia, Too

April 17, 2009

“Look at the size of the complex, in the above photo. The scale is comparable to an oil sands project in Northern Alberta, with its years of pipes and preparation before a drop of oil begins to flow. This is no simple straw in the sand. Khurais is a true mega-project.”

http://seekingalpha.com/article/131496-saudi-khurais-field-looks-like-easy-oil-may-be-gone-from-arabia-too

For another Kaiser interview see my post “peak oil in 1001 nights”  http://www.crudeoilpeak.com/?p=690

Q: Why should Abu Dhabi bail out Dubai?
Max:  That’s where it’s getting very interesting.  There is a political element here. Because Dubai is sympathetic to the interests of Iran and Abu Dhabi is sympathetic to the interests of Saudi Arabia. And Abu Dhabi was not all too happy with the way Dubai was entertaining the Iranians and also there is tremendous amount of  commerce that goes through Dubai as away to go around the trade restrictions on Iran. So Abu Dhabi, in a way, as an opportunity to shut down the trade between Dubai and Iran on a purely political level. So there are the political motives not to help Dubai and they have an economic motive not to help Dubai because there is no reason to chase good money after bad.
Q: Will Dubai go bust or will it be saved?
Max: ……One thing Dubai is relying on going forward to finance themselves and the region of course are their oil reserves ..but my sources in Saudi Arabia tell me that the Ghawar oil field, for the past 3 years, has shown 10% production decline. That’s on top of the declines in Kuwait and the production declines in the Cantarell field in Mexico. So the world has hit peak oil. And what is the Middle East gonna be like without cheap oil  and this is another part of the story.

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