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Oil minister says prices will remain high, Saudi not running out of oil
Source: BI-ME and agencies , Author: BI-ME staff
Posted: Sun March 2, 2008 12:00 am
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SAUDI ARABIA. Saudi Arabia's oil minister Ali Al Nuaimi believes that his country would have production capacity of 12.5 million barrels per day (bpd) at the end of 2009, from 11.0 million bpd currently, with spare capacity of 1.5-2.0 million bpd.

In an interview released Sunday, Al Nuaimi also said that Saudi Arabia, which already has the biggest proven oil reserves in the world and exports 10 million bpd, planned to add another 200 billion barrels of oil to its proven reserves figure.

He said this was "to reassure the world that we are not going to run out of oil in the next five to ten years as peak oil theorists say."

Exploration efforts to find new oilfields that could be exploited in the future will also continue.

"Saudi Arabia is not fully explored," he said.

“Peak oil is probably now past tense and the world is desperately in need of a sustainable series of new energy sources and urgent adoption of conservation measures to wean 'us' all from a chronic addiction not just to oil, but all three forms of fossil fuels,” said Matthew Simmons, Chairman and founder of Simmons & Company International (SCI).

Simmons is a strong proponent of the dangers of peak oil and believes the peak oil issue is poorly understood and the world’s data on production, demand and inventories is alarmingly inaccurate.

According to Simmons one of the most critical questions facing the global energy market is whether key oil producing nations can increase oil production to meet the current and future growth in world demand.  He warns that with the rapid population growth, improved economies and subsequent increase in vehicles the world’s demand for oil can only continue to multiply.

Al Nueimi also believes that oil prices are set to stay above a minimum price of US$60-70  per barrel, signalling a new era for world energy markets."A line has been drawn below which prices will not fall," he said.

His explanation to French oil newsletter Petrostrategies, was technical, based on the idea that public policy in many countries was to invest in alternative energy sources to compete with crude, reported AFP.

"If you take all the subsidies that go into producing a barrel of biofuels, I doubt that anybody can make money in that business with a price less than US$60-70," Al Nuaimi said.

MIDDLE EAST BUSINESS COMMENT & ANALYSIS

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UAE. Location and quality are driving apartment prices; while average prices decreased, select communities, including Palm Jumeirah and Downtown Burj Dubai, experienced slight increases according to Landmark Advisory's latest quarterly report.
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UAE. Location and quality are driving apartment prices; while average prices decreased, select communities, including Palm Jumeirah and Downtown Burj Dubai, experienced slight increases according to Landmark Advisory's latest quarterly report.