Iran's oil production is drying up (WSJ)

[phantom power]

(...)

Bill Spindle writes in the Journal this morning that Iran's oil production is stagnating. Demand in the country is high because the government makes the price of gasoline very cheap. At the same time, "a combination of Western sanctions and Iranian policies has discouraged foreign investment in oil fields," resulting in a lull in production growth. The problem is so severe that Iran's government "shelled out at least $7 billion on gasoline imports alone so far this fiscal year."

(...)

At the same time, a combination of Western sanctions and Iranian policies has discouraged foreign investment in oil fields, causing production to stagnate. The result: Iran's oil exports could dry up in as little as a decade, according to some who have studied the situation.

The impact would be felt far beyond Iran. The country produced 3.8 million barrels of oil a day in 2006, almost 5% of the world's total supply, according to the Organization of Petroleum Exporting Countries. It exported an average of about 2.5 million barrels of that each day. Should those sales decline, Iran's largest customers, Japan and China, would scramble for other supplies, pushing up prices for everyone.

Avoiding an export squeeze is one reason Iran argues it needs to consider nuclear energy. But that ambition has contributed to a diplomatic impasse with the West. Bush administration officials describe Iran's nuclear program as little more than a ruse to conceal what they say is a hidden effort to build nuclear weapons. Iranian officials deny that, arguing that nuclear plants could handle some of the soaring domestic energy demand, leaving more oil and gas to export and avoiding difficult domestic choices.

http://www.rawstory.com/printstory.php?story=5043

[GliderGuider]

1. And people are starting to notice KSA's odd behaviour as well

Saudis' cutbacks raise oil concerns

Meanwhile, Saudi production is reportedly down about 1 million barrels a day from an average of about 9.5 million barrels a day through much of 2005.

It is not just the decline that is troubling, Hamilton said. "I don't know for sure what the answer is, but I find the facts disturbing."

• Cutbacks started when prices were high.

• The Saudis have been nearly frantic in their recent drilling for more oil.

• Some reports show the Saudis increasingly relying on lower-quality, less valuable oil.

The questions about Saudi Arabia tap into an ongoing controversy.

Nearly all geologists agree that sooner or later the world will reach the midway point in the era of oil, the moment when half the Earth's crude has been pumped. But there is a small, vocal contingent who have been warning that the world is approaching peak oil very soon.

Or is already there.

From the moment "peak oil" arrives, the search will be on for cost-efficient alternative fuels. Meanwhile, producers will have an incentive to hunt for and pump lower-quality or hard-to-find crude.

Relentless economic pressures will send oil — now selling for just under $60 a barrel — steadily toward the stratosphere, Hamilton said. "If Saudi Arabia is in decline, then oil is way too cheap."

[phantom power]

2. I think the circumstantial evidence over the last year or so is pretty compelling.

I'm more certain all the time that we hit peak circa 2005. The recent calls for independent auditing of OPEC projections suggests that the rest of the world smells a rat too.

The really worrisome thing is that everybody already knows about a cost-efficient alternative: coal + FT. It's going to be very seductive, even if it's the equivalent of reaching for a parachute and being handed an anvil.

[Double T]

3. The market manipulation on oil and energy products via BS propoganda.........

is nauseating.:puke:

[phantom power]

4. If they told us the truth, oil would probably be trading at $100/barrel.

[Double T]

5. What is the REAL TRUTH????

I'm NOT CERTAIN ANYONE knows, or wants 'US' to know.

http://www.radford.edu/~wkovarik/oil/oilcharts.html

http://www.radford.edu/~wkovarik/oil/index2.html

[phantom power]

6. I think reality is going to be a disappointment to you.

Here is how I interpret recent events: Cantarell is dropping like a rock. The North Sea is close behind. Iran is evidently past peak. Saudi Arabia is playing its cards close to the chest, but their repeated promises to increase production aren't being met. Widespread use of boosting production rates with sea water, nitrogen, or whatever else they might be pumping down there to keep the wells pressurized, means that instead of a nice graceful backside curve, we're getting a cliff. 10%/year, 15%/year, bad stuff.

Remaining sources aren't just a little bit harder to exploit, they're a lot harder. None of them are coming on line as fast as the original predictions. Climate change is destabilizing a lot of extraction sites, either thru permafrost loss or icebergs or tropical storms.

It's really pretty close to the worst-case imagined by the peak-oil doomers.

[pscot]

7. Next Stop, PANDEMONIUM

N/T

[brokensymmetry]

8. I always value your posts....

You have some good insights, consistently.

I suspect you're absolutely correct on what you
say here. And the results will not be pretty...