Is the oil peak here???

Bank says Saudi's top field in decline (By Adam Porter in Perpignan, France, Tuesday 12 April 2005, 13:52 Makka Time, 10:52 GMT , aljazeera.net)

Proving that al Jazeera isn't just about publishing the rants of terrorists (or so the U.S. news media would have us believe), they also are carrying this interesting story. It seems that Saudi Arabia's largest oil field has started to decline in production.

By definition that means Saudi Arabia's oil production has started to decline, and therefore so has the worlds.

Which, if true, signals that the world has reached the peak oil point. Maybe. If true.

"The combination of the news that there's no new Saudi Light coming on stream for the next seven years plus the 27% projected decline from existing fields means Hubbert's Peak has arrived in Saudi Arabia," says Coxe, referring to data compiled by the International Energy Association's (IEA) August 2004 monthly report.

... If Gharwar, the world's biggest field, is seen to be "in decline", as Coxe says, the effects could be problematic. Markets could panic, forcing prices up, creating shortages and profoundly affecting the world economy.

"The kingdom's decline rate will be among the world's fastest as this decade wanes," predicts Coxe. "Most importantly, Hubbert's Peak must have arrived for Gharwar, the world's biggest oilfield."

Coxe dismisses Saudi claims that the country can produce extra capacity to satisfy surging demand. He notes that Saudi promises to increase production last year failed to materialise. Aramco had pledged an extra 500,000 barrels of oil immediately and an extra 5 million bpd by 2012.

He says the markets had "assumed this first flow would be a half million barrels daily of the benchmark Saudi Light, the high-end product that any oil refinery can process. Instead ... the new oil was heavy, sulphurous oil that only a few refineries had the spare capacity to use".

Continuing, he asks: "What about those 5mbpd of new production by 2012? It turned out that only 2.5 million barrels would be net additions to Saudi output: Declines from existing fields will slash production by 2.5 million bpd."