Saudi Arabia Says It Will Boost Oil Output in June (a token increase for *)

[maddezmom]

Source: Bloomberg

May 16 (Bloomberg) -- Saudi Arabia, the world's largest oil exporter, will increase crude production next month in response to rising demand from its customers and a request by U.S. President George W. Bush to ease the strain of record oil prices.

The country will raise output by 300,000 barrels a day to 9.45 million barrels a day in June, Saudi Oil Minister Ali al- Naimi said in Riyadh today, following a meeting between Bush and Saudi Arabia's King Abdullah. Earlier today, U.S. National Security Adviser Stephen Hadley said the Saudi policy was to supply extra oil only if customers needed it.

``On May 10 we increased our response to our customers by 300,000 barrels because they asked for it,'' al-Naimi said. ``So our production for June will be 9.45 million barrels per day. This is the request of about 50 customers worldwide.''

~snip~

``It's just a token increase but it shows that the Saudis realize just how important it is for the president to not come back empty handed,'' said Peter Beutel, president of Cameron Hanover Inc. in New Canaan, Connecticut. ``This is about a lot more than oil, the special relationship between the countries is at stake.''



Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=as3Qc9uGN5To&refer=home

---

will it be enough for them to get the arms they wanted?

[Clear Blue Sky]

1. Sounds like a belated wedding present for Jenna and her Dad...

[liberal N proud]

2. If only it were that simple

The commodity market will remain at record levels and prices will not come down.

[dipsydoodle]

3. special relationship is at stake

aka play ball or we fuck you

[NickB79]

4. Let me guess: more of the heavy sour crude no one wants anyway

And few refineries can even process.

What crap.

[neverforget]

5. Do they have the oil to pump out of the ground? that's the question.

:shrug: Most of their fields are very old.

[bullimiami]

6. so "production is running full out" was a lie all along? of course it was.

they are cronies of bushco.

[RantinRavin]

7. I don't recall the Saudi's ever saying they were pumping full capacity

The peak oil blogs and news media getting their information from them were claiming that.

[old guy]

8. AP said earlier that they were not going increase output.

MSNBC still has its headline that they will not. Very curious.

[Freddie Stubbs]

9. For those of you who aren't very good at math, that is about a 3% increase

[Deny and Shred]

10. Actually, it.s a 0.3% increase.

[Freddie Stubbs]

12. Let's walk through the math of this:

The country will raise output by 300,000 barrels a day to 9.45 million barrels a day in June

If they are increasing output by 300,000 to 9.45 million, then current output must be 9.15 million (9,450,000 - 300,000 = 9,150,000).

We need determine how much of an increase this is. We can determine that by dividing 9.45 million by 9.15 million (9.45/9.15 = 1.03).

9.45 is approximately 103% of 9.15, which would be about a 3% increase.

[TomInTib]

13. June, July, August...

The highest petrol-consumption months in the US.

This is a joke. And a piss-poor one, at that.

[FarCenter]

16. It is about a 0.35% increase in world-wide production

World-wide production is roughly 85 million barrels per day.

So the increase in percent is 100*0.3/85 = 0.35% or about one third of a percent.

That is assuming that some other country doesn't cut production by 0.3 million barrels per day.

[madmax]

11. MSNBC sayssomething different

But, the Bloomberg report states "Update Number 3".

"RIYADH, Saudi Arabia - Saudi Arabia’s leaders made clear Friday they see no reason to increase oil production until customers demand it, apparently rebuffing President Bush amid soaring U.S. gasoline prices.

It was Bush’s second personal appeal this year to King Abdullah, head of the monarchy that rules this desert kingdom that is a longtime prime U.S. ally and home to the world’s largest oil reserves. But Saudi officials stuck to their position that they will only pump more oil into the system when asked to by buyers, something they say is not happening now, the president’s national security adviser told reporters." http://www.msnbc.msn.com/id/24660754/

[Wizard777]

15. Bloomberg is the only one saying there will be a production increase.

Everyone else is saying no increase.

[maddezmom]

17. reuters has it now

http://www.reuters.com/article/OILINT/idUSL1618167620080516

[cliss]

14. This is a story to watch very carefully.

I don't believe Saudi Arabia has the ability to increase production. In fact, there is evidence that their supplies are suspect. There seems to be discrepancies in their reserves, and how much they are actually pumping.

I suspect that they've been asked, repeatedly to increase production. Especially in this election year.
Problem is, they can't.
Or won't.

[ToughLuck]

18. BFD

[maddezmom]

19. my question is will it be enough?

US Senators threaten Saudi arms deal over oil prices
3 days ago

WASHINGTON (AFP) — A group of Democratic Senators Tuesday threatened to block a multi-million dollar US arms deal with Saudi Arabia, unless the kingdom ups oil production and helps cut soaring gasoline prices.

The senators introduced a resolution of disapproval on the arms sale, as President George W. Bush prepared to head for Saudi Arabia, partly on a mission to contain runaway oil prices.

"We are saying to the Saudis that, if you don't help us, why should we be helping you?" said New York Democratic Senator Chuck Schumer.

"We are saying that we need real relief, and we need it quickly. You need our arms, but we need you to cooperate and not strangle American consumers."

more:http://afp.google.com/article/ALeqM5iyoswDU3YRSzMFgn3hAQHAx-Xqng

[bluesmail]

20. I read on DU not too long ago

that Saudi Arabia did not want oil production in Iraq, they wanted chaos, (MIC as a bonus), so when the price of oil leaped, (for a variety of reasons) it made Saudi Arabia The KING of Oil, not to mention the (WAR) profiteers.

[SunDrop23]

21. "My name is George Bush and I just got punk'd..."

300,000 barrels a day.
I think I could have negotiated that much.

[Ilsa]

22. Is this okey-dokey with the rest of OPEC? Or will they balk at this? nt

[Goodnevil]

36. OPEC'S last official Statement on this Issue

http://www.opec.org/opecna/Press%20Releases/2008/pr072008.htm

No 7/2008
Vienna, Austria - 8 May 2008

In recent months, oil prices have become increasingly volatile, mainly driven by financial market developments and the increased flow of speculative funds into oil futures. The turmoil in some global equity markets and the considerable depreciation in the US dollar have encouraged investors to seek better returns in commodities, particularly in the crude oil futures market. This has driven prices higher.

There is clearly no shortage of oil in the market. OECD commercial oil stocks remain above the five-year average, with days of forward cover at a comfortable level of more than 53 days. US crude inventories, meanwhile, rose by almost six million barrels last week, which is a further indication that oil supplies are plentiful. OPEC Member Countries continue to produce at more than 32 million barrels a day (mb/d). In addition, a number of new OPEC crude oil projects have started to come on-stream and OPEC spare capacity continues to increase, with the figure currently standing above 3 mb/d. At the same time, crude oil movements indicate that some Member Countries are unable to find buyers for their additional supply.

OPEC will continue to be proactive and monitor these developments closely. The Organization stands ready to act if the market shows a need for any further measures.

The Organization will continue to strive for a stable and balanced market, with prices that reflect fundamentals, and are favourable to both producers and consumers.

[MilesColtrane]

23. I wonder if Bush pulled any muscles as he was "jawboning" the Saudis.

That much ass kissing can be hard on the lips.

[nradisic]

24. Saudis to boost oil output after US pressure

Source: Financial Times

Saudi Arabia said on Friday that it was increasing its oil production to its highest level in two years, bowing to intense US pressure after the price surged to a fresh record of almost $128 a ­barrel.

The announcement of a boost to output by about 300,000 barrels a day came after a plea by George W. Bush, US president, to King Abdullah of Saudi Arabia in Riyadh.

Read more: http://www.ft.com/cms/s/0/be0d6daa-2347-11dd-b214-000077b07658.html?nclick_check=1

---

Hmm? I thought they said no to raising production just yesterday?

[DainBramaged]

25. The Senate threatened to hold $1.2 BILLION in arms sales if they didn't

We want the oil, they want the arms. Death merchants we all are.

[newfie11]

26. We should have asked for a hell of a lot more than 300,000

barrels in exchange for arms!!

[robcon]

27. Do you have a link or reference on that.

The "Senate" doesn't do anything until there is a vote. Senators say and do things, and which Senators threatened the hold?

[DainBramaged]

28. Yup

Here

http://www.gulfinthemedia.com/index.php?id=401966&news_type=Top&lang=en&

A group of US senators Tuesday threatened to block a billion dollar US arms deal with Saudi Arabia unless the kingdom ups oil production and helps cut soaring gasoline prices.

The senators, all Democrats, introduced a resolution of disapproval on the arms sale, as President George W. Bush prepared to head for Saudi Arabia, partly on a mission to contain runaway oil prices.


Oh and this sentence was key

Schumer said a motion of disapproval needed only 51 votes in the 100-seat Senate to pass and could not be filibustered.

[Phred42]

30. deleted

[DainBramaged]

32. Irrelevant? Gee, we've cut back on our driving and we had one of the

warmest winters on record so heating oil production was lower than usual, plus the damn corn fuel production is replacing millions of gallons of oil every day. I'm sure the capacity is there without anyone screaming for new refineries on every corner. And do you think the 300,000 extra bbls. are headed here? Not.

[Phred42]

33. Good point on where the bbls are headed. The same is true

for Anwar. That Oil (if pumped ) will NEVER see the US. It will be headed for Japan or Communist China

[Tippy]

29. Hold on.....something not right

Saudi Arabia....told bush when he asked them to increase production, they told him they had already increased production to 300,000 barrels a day so I am thinking the Saudis said this took place first week of May...

[Tippy]

34. I was wrong the increase came on May 10

Saudis rebuff U.S. request to loosen oil supply Posted on May 16th
by Mark Silva

RIYADH, Saudi Arabia — The Saudis have agreed to only a modest boost in oil production, announced in the midst of meetings with Saudi King Abdullah and President Bush over tea, lunch and dinner and an overnight stay for Bush at the palatial horse farm where the Saudi ruler keeps 150 thoroughbred Arabian stallions.

But, for the second time in five months, the Saudis have rebuffed the Bush administration’s request for significantly stepped-up oil production to ease rising oil prices. The Saudi oil minister said the Saudis already had marginally boosted production by about 300,000 barrels a day, as of May 10, to meet world demand, including U.S. demand, as they see it - boosting production to 9.45 million barrels a day during June.

[Ilsa]

38. CNN reported that the increase was agreed to around May 6, at the

request of their customers, not Bush.

[Phred42]

31. Irrelevant - Where will the additional REFINING capacity come from ?

[ohio2007]

35. increase pumping capacity from 100% to 110% is another problem but how much Saudi oil goes to China

and the EU ?
Those countries welcome the comments but we do not get oil from outside of this hemisphere so our capacity to refine what we will not get keeps the price high.

[Hannah Bell]

39. We're currently only using 86% of refining capacity.

http://tonto.eia.doe.gov/dnav/pet/hist/wpuleus3W.htm

[Ilsa]

37. They did say "No". The Saudis agreed to raise production earlier this month.

They had concluded around May 6th to up production because their customers were requesting it, ot Bush.

The Financial Times is giving credit where it is not due.