Wikileaks: Saudi reserves are overstated by 40%

http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks

"Could “peak oil”—the point after which global production of oil will decline as a result of depleted supply—arrive as soon as 2012? That’s what one Saudi government oil executive warned, according to new diplomatic cables from the WikiLeaks dump. The executive, Sadad al-Husseini, said that Saudi Arabia may have overstated its oil reserves by as much as 40 percent in order to attract foreign investment. Consequently, Saudi Arabia will probably be unable to thwart rising oil prices by pumping more oil, al-Husseini said. The U.S. diplomat sending the cable to Washington wrote, "While al-Husseini fundamentally contradicts the Aramco company line, he is no doomsday theorist. His pedigree, experience and outlook demand that his predictions be thoughtfully considered.""

The real issue isn't peak oil here, but the official although secret confirmation of a Gulf state overstating its reserves. It is well known that pretty much ALL OPEC members overstate their reserves to gain a bigger quota. Well, since everybody lies, even if you want to be honest, you still have to lie just to stay even....

 

I hope that we're not putting too much stock in anything the Saudi's say regarding their oil reserves, as obviously they have an agenda.

Clearly they would want to give the appearance of being able to control prices to the down side, so that companies/governments are less likely to invest in new technologies.

I would hope that our intelligence agencies would have factored that in decades ago, but you never know.

 

Best part of the article:

"While stating that he does not subscribe to the theory of "peak oil," the former Aramco board member does believe that a global output plateau will be reached in the next 5 to 10 years and will last some 15 years, until world oil production begins to decline."

...and that is, ladies and gentlemen, the definition of peak oil.

 

Futures market not playing along.

 

I wasn't expecting an immediate effect, specially that some of those cables were from 2007.

Generally I would like to see more leaks in this nature. They still haven't leaked the BoA stuff, and that was promised for January...

 

The BoA leaks were hyped up..

http://www.reuters.com/article/2011/02/09/us-wikileaks-bankofamerica-idUSTRE7185W620110209

 

It is also tricky since OPEC nations based quota on their proven reserves.