US embassy cables: Saudi oil company oversold ability to increase production, embassy told

Cable dated:2007-12-10T05:54:00
C O N F I D E N T I A L SECTION 01 OF 03 RIYADH 002441
SIPDIS
SIPDIS
DHAHRAN SENDS DEPT OF ENERGY PASS TO MWILLIAMSON, GPERSON, AHEGBURG, AND JHART CIA PASS TO TCOYNE
E.O. 12958: DECL: 12/10/2017
TAGS: EPET, ENRG, ECON, SA
SUBJECT: FORMER ARAMCO INSIDER SPECULATES SAUDIS WILL MISS 12.5 MBD IN 2009
REF: RIYADH 1950
Classified By: Consul General John Kincannon for reasons 1.4 b, d and e .

SUMMARY: On November 20, 2007, CG and Econoff met with Dr. Sadad al-Husseini, former Executive Vice President for Exploration and Production at Saudi Aramco. Al-Husseini, who maintains close ties to Aramco executives, believes that the Saudi oil company has oversold its ability to increase production and will be unable to reach the stated goal of 12.5 million b/d of sustainable capacity by 2009. While stating that he does not subscribe to the theory of “peak oil,” the former Aramco board member does believe that a global output plateau will be reached in the next 5 to 10 years and will last some 15 years, until world oil production begins to decline. Additionally, al-Husseini expressed the view that the recent surge in oil prices reflects the underlying reality that global demand has met supply, and is not due to artificial market distortions.

 

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