Saudi's warn: "Our production is declining..."

The implications are many: more energy market concentration in a few, predominantly Middle East hands, with future accusations of oil pricing “blackmail” and geopolitical tensions and rivalries in the region.

Even if demand remained steady, the world would have to find the equivalent of four Saudi Arabias to maintain production, and six Saudi Arabias if it is to keep up with the expected increase in demand between now and 2030.

Unlike earlier periods of oil supply lagging behind demand, this time Saudi Arabia is giving ample warning to do something, otherwise not to blame it and other oil producers for the consequences that will make $147 a barrel oil seem a blessing by comparison.

SHOOT: My guess is these warnings won't be taken seriously. I offered MoneyWeb a series of articles on this and they said they didn't feel it was relevant to their audience. Um....it's relevant, actually, to everyone. It's perhaps the most relevant thing.

clipped from www.thenational.ae The International Energy Agency (IEA), meanwhile, has done some homework on the subject and the first detailed assessment of more than 800 oilfields covering three quarters of global reserves has found that most of the biggest fields have already peaked. It also found that the rate of decline in oil production is now running at nearly twice the pace that it calculated just two years ago. The IEA estimates that the decline in oil production in existing fields is now running at 6.7 per cent a year compared to the 3.7 per cent decline it estimated in 2007, a figure it now acknowledges to be wrong. On top of this, there is a problem of chronic underinvestment by oil-producing countries – with the exception of Saudi Arabia and the UAE to a lesser extent – a feature that is set to result in an “oil crunch” within the next five years.