Monday, February 7, 2011
I updated my graph (above) of Saudi oil production with the latest numbers (up to December from at least two sources). The graph shows five different data sources, together with an average index (thick black line) which summarizes the various data sources into something that is hopefully within hailing distance of the truth.
The interesting thing going on at the moment is the trend in the last six months for Saudi production to creep up. The most recent data strengthen this impression. It is only a few hundred thousand barrels/day at the moment - nothing like the events of early 20003 or early 2004 when Saudi Aramco just turned on the taps to the tune of a million bpd or a million and a half within a single month.
Still, it's an interesting trend, and it will be even more interesting to see if they sustain it over the next six months as we go into the summer driving season in the northern hemisphere with oil prices already fairly high. Or, in the alternative, is the return of rhetoric about how "the market is well supplied" from Saudi and OPEC officials the precursor to a refusal to raise production higher in the face of high prices?
Update: and here's the latest oil rig counts in country:
I interpret the ongoing decline as evidence that the Saudis are comfortable, for now, with the amount of spare production capacity that they have.