Saudi Arabia Divided on Oil Policy
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Editor’s Note: Dave Gonigam in Desidooru Saloon has picked up on a power struggle among Saudi Arabia’s oil elite that could have major implications for the energy market…
Saudi Arabia’s Power Struggle
By Dave Gonigam
America is not alone when it comes to Peak Oil theorists versus cornucopians. Saudi Arabia has its own factions, each led by former executives at Saudi Aramco.
The Wall Street Journal picks up a spat between Sadad al-Husseini — who’s convinced Saudi Arabia’s salad days are behind it — and his one-time protege Nansen Saleri — who thinks plenty more oil can be found.
Most illuminating is how Saudi Arabia’s senior leadership is ping-ponging back and forth between the two outlooks as oil sits at record-high prices.
In recent months, Saudi leaders appeared to have adopted Mr. Husseini’s view. Local reports quoted King Abdullah saying that some new discoveries should stay in the ground. “With grace from God, our children need it,” he said. [Ali] Naimi, the oil minister, announced that Aramco saw no need to go beyond 12.5 million barrels a day [of capacity, not production] next year.
But on Sunday, under heavy international pressure, the kingdom revived its earlier promise to push for the far higher target of 15 million barrels a day.
How this power struggle plays out will have a lot to say about the supply-and-demand balance in the next four years.
Source: Saudi Arabia’s Power Struggle
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Tags: Crude Oil Prices, Dave Gonigam, investin in oil, peak oil, Saudi Arabian Oil ProductionAbout the Author
Dave Gonigam is a contributor to Whiskey & Gunpowder, Daily Reckoning and Desidooru Saloon.
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