Saudi Arabia Cuts Output From 9.2 to 9.0 MBD - "Reflects Demand From Our Customers"

[hatrack]

LONDON: Saudi Arabia, the world's top oil exporter, has trimmed its output to about nine million barrels per day (bpd), a Saudi oil source said yesterday.

The level is slightly lower than the 9.2m bpd that Saudi Arabia had been producing until now and reflects lower customer demand, the source said.

"Saudi oil production currently is around nine million barrels per day, which reflects the demand from our customers," the Saudi oil source said.

He reiterated the kingdom's production capacity stands at 11.3m bpd and will rise to 12.5m bpd by next year.

EDIT

http://www.gulf-daily-news.com/Story.asp?Article=214240&Sn=BUSI&IssueID=31023

[Aviation Pro]

1. Two ways of looking at this....

1. A decrease in demand leads to a decrease in price.

2. A decrease in output leads to an increase in price because of the paucity of the unit.

Don't economies of scale suck?

[Texifornia]

2. I'm skeptical

I don't think Saudi Aramco has that much swing production. I do believe that they will increase capacity by about a million BPD but I think the depletion curve at Ghawir must be steeper than anticipated.

Since the embargoes of the 70s Saudi Aramco has had a policy of not pinching supply in order to maintain price stability and disincentivize hydrocarbon exploration elsewhere and other energy sources. The idea that they would make a press release about a 200,000 BPD reduction when prices are at all-time highs is, well, odd.

[dkf]

3. Looks to me like the reports Saudi Arabia has peaked is right.

[SlicerDicer-]

4. Indeed. Anybody who says otherwise must have Oceanfront Property in AZ

[dkf]

5. And people wonder why the price of oil is going up...

Its the oil companies fault they say.

Are they in for a surprise.

:scared:

[SlicerDicer-]

6. Evil Evil Evil!! oil companies!!!! Down with them they should be castrated and burned at the stake!

Yep thats what the mentality is... When truly if you look at a free market with prices as high as they are in realty there should be more supply to make more money! And ontop of this during the best of times "now" there should be substantial exploration while they have money.. However there is nothing found that has merit like a Cantarell or Gahwar, Burgan etc..

The reality is they are pouring money into things like Athabasca... that are horrible EROI by comparison... Also the total output is highly questionable that they will be able to go higher than today.. Too much water and energy needed.

I love Holmgren's permaculture concepts though they do deserve merit in.

http://www.youtube.com/watch?v=OFjFG24BeX8

[amandabeech]

7. Lemme see. The Saudis may be peaking, Mexico is going downtown,

the oil companies are dropping zillions for tar sands and using all the nat gas in the process.

Hugo isn't selling to us much, and he's depleting anyway, at least in regular crude.

The Russians haven't found anything new recently.

Oman topped out.

Iran needs more oil for itself, and is exploiting some yucky sulfurous stuff.

Time to visit TOD for the latest.

[Dead_Parrot]

8. Quite.

Although if you get in early there'll be a nice profit to be made around Yuma in a decade or two. :)

[SlicerDicer-]

10. HAHA!!! I love it :)

Yuma thats so brilliant :)

[NickB79]

9. Wow, I'm scared to see the oil markets Monday

This could drive speculators ape-shit.