<html><head></head><body style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; ">We all knew this. The figures have come in from several sources, none of us can<br>be surprised. But the Wikileaks cables have now added some confirmation and now<br>"US officials" have to adjust their mindset and face the facts.<span class="Apple-style-span" style="font-family: Georgia; font-size: 12px; "><br></span><div>
<span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-family: Helvetica; font-size: medium; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-align: auto; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-family: Helvetica; font-size: medium; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-family: Helvetica; font-size: medium; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-family: Helvetica; font-size: medium; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-family: Helvetica; font-size: medium; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-family: Helvetica; font-size: medium; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><span class="Apple-style-span" style="border-collapse: separate; color: rgb(0, 0, 0); font-family: Helvetica; font-size: medium; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: 2; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-border-horizontal-spacing: 0px; -webkit-border-vertical-spacing: 0px; -webkit-text-decorations-in-effect: none; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px; "><div style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><div>-----------------------------</div><div>Keith Thomas</div><div><a href="http://www.evfit.com">www.evfit.com</a></div><div>-----------------------------</div></div></span></div></span></div></span></div></span></div></span></div></span></span></div><span class="Apple-style-span" style="font-family: Georgia; font-size: 12px; "><br><a href="http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks" style="text-decoration: none; color: rgb(36, 124, 212); ">http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks</a><br><br>WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices<br><br>US diplomat convinced by Saudi expert that reserves of world's biggest oil<br>exporter have been overstated by nearly 40%<br><br><br><br>The US fears that Saudi Arabia, the world's largest crude oil exporter, may not<br>have enough reserves to prevent oil prices escalating, confidential cables from<br>its embassy in Riyadh show.<br><br>The cables, released by WikiLeaks, urge Washington to take seriously a warning<br>from a senior Saudi government oil executive that the kingdom's crude oil<br>reserves may have been overstated by as much as 300bn barrels – nearly 40%.<br><br>The revelation comes as the oil price has soared in recent weeks to more than<br>$100 a barrel on global demand and tensions in the Middle East. Many analysts<br>expect that the Saudis and their Opec cartel partners would pump more oil if<br>rising prices threatened to choke off demand.<br><br>However, Sadad al-Husseini, a geologist and former head of exploration at the<br>Saudi oil monopoly Aramco, met the US consul general in Riyadh in November 2007<br>and told the US diplomat that Aramco's 12.5m barrel-a-day capacity needed to<br>keep a lid on prices could not be reached.<br><br>According to the cables, which date between 2007-09, Husseini said Saudi Arabia<br>might reach an output of 12m barrels a day in 10 years but before then –<br>possibly as early as 2012 – global oil production would have hit its highest<br>point. This crunch point is known as "peak oil".<br><br>Husseini said that at that point Aramco would not be able to stop the rise of<br>global oil prices because the Saudi energy industry had overstated its<br>recoverable reserves to spur foreign investment. He argued that Aramco had badly<br>underestimated the time needed to bring new oil on tap.<br><br>One cable said: "According to al-Husseini, the crux of the issue is twofold.<br>First, it is possible that Saudi reserves are not as bountiful as sometimes<br>described, and the timeline for their production not as unrestrained as Aramco<br>and energy optimists would like to portray."<br><br>It went on: "In a presentation, Abdallah al-Saif, current Aramco senior<br>vice-president for exploration, reported that Aramco has 716bn barrels of total<br>reserves, of which 51% are recoverable, and that in 20 years Aramco will have<br>900bn barrels of reserves.<br><br>"Al-Husseini disagrees with this analysis, believing Aramco's reserves are<br>overstated by as much as 300bn barrels. In his view once 50% of original proven<br>reserves has been reached … a steady output in decline will ensue and no amount<br>of effort will be able to stop it. He believes that what will result is a<br>plateau in total output that will last approximately 15 years followed by<br>decreasing output."<br><br>The US consul then told Washington: "While al-Husseini fundamentally contradicts<br>the Aramco company line, he is no doomsday theorist. His pedigree, experience<br>and outlook demand that his predictions be thoughtfully considered."<br><br>Seven months later, the US embassy in Riyadh went further in two more cables.<br>"Our mission now questions how much the Saudis can now substantively influence<br>the crude markets over the long term. Clearly they can drive prices up, but we<br>question whether they any longer have the power to drive prices down for a<br>prolonged period."<br><br>A fourth cable, in October 2009, claimed that escalating electricity demand by<br>Saudi Arabia may further constrain Saudi oil exports. "Demand [for electricity]<br>is expected to grow 10% a year over the next decade as a result of population<br>and economic growth. As a result it will need to double its generation capacity<br>to 68,000MW in 2018," it said.<br><br>It also reported major project delays and accidents as "evidence that the Saudi<br>Aramco is having to run harder to stay in place – to replace the decline in<br>existing production." While fears of premature "peak oil" and Saudi production<br>problems had been expressed before, no US official has come close to saying this<br>in public.<br><br>In the last two years, other senior energy analysts have backed Husseini. Fatih<br>Birol, chief economist to the International Energy Agency, told the Guardian<br>last year that conventional crude output could plateau in 2020, a development<br>that was "not good news" for a world still heavily dependent on petroleum.<br><br>Jeremy Leggett, convenor of the UK Industry Taskforce on Peak Oil and Energy<br>Security, said: "We are asleep at the wheel here: choosing to ignore a threat to<br>the global economy that is quite as bad as the credit crunch, quite possibly<br>worse."</span></body></html>