Why The Saudis Are Lying About Their Oil Reserves & Production

According to various sources , the effect of the combined attack on Abqaiq and Khurais caused the temporary suspension of 5.7 million barrels per day . This equates to well over half of Saudi Arabia’s actual crude oil production capacity, not the capacity figure that Saudi has plucked out of nowhere for geopolitical power purposes in recent years, and resulted in the biggest rise in oil prices in a single day ever. Repairs at the Khurais field and the Abqaiq processing facility may take several months rather than the ten weeks tops that Aramco had initially estimated. Aramco, is in urgent talks with equipment manufacturers and service providers and is willing to pay premium rates for faster delivery and installation. Still, the repairs work could last months because the equipment has to yet be manufactured, delivered and installed, and this could take as long as a year. Meanwhile, new drones can reportedly be manufactured in weeks. Bad luck, Salman. The report suggests initial expectations by Aramco may have been overoptimistic. As a result, we could see another spike in prices soon. Bloomberg estimated earlier this month that Saudi Arabia has about 50 million barrels of oil in storage at home plus another 80 million barrels stored abroad. This will be enough to keep its exports going at regular rates, but some expect a supply gap to open up late next month. Uncertainty is growing as a result of conflicting reports: first media reported Saudi Arabia had asked Iraq for light crude to insulate itself from a supply gap, and then Riyadh said it had never done that. Now, the official position continues to be that repairs will take a few weeks, with the Wall Street Journal report suggesting that this might not be the case. IF Saudi Arabia has only 1 million barrels reserved then China will substantially increase imports of Iranian oil. This may even help out Venezuela If Iran's exports surpass that of Saudi Arabia it could be a psychological victory for Iran. The world will stand up and take notice. Whatever Saudi’s actual capacity, there is absolutely no way that it can have made any accurate assessment of how long it would take to get back to any particular capacity level either – another lie. “Engineers we have spoken to have said that following an incident like this it would take several weeks just to assess the damage, never mind to begin doing anything about it, rather than the few days that the Saudis have taken and then announced the actual timeline – and a very short timeline at that – to bring back various stages of capacity . Instead, what the Saudis will do to keep exports up is draw down supplies to its domestic industry and reduce the amounts it is sending to domestic refineries – one big refinery, SASREF, is conveniently bringing forward its planned maintenance for later in the year to now - and we hear very mixed reports which of the other refineries are operating at regular rates . The other measure that Saudi is taking confirmed from various oil trading sources and from sources in the Iraq Oil Ministry – Saudia is looking to buy Iraq oil grades, which are close to the key export grades that Saudi ships to various destinations, including Asia. Aramco Trading Company has been aggressively checking prices and lot sizes for Iraqi crude with various oil trading houses since the attacks and are looking at shorter-term potentially rolling contracts. A number of the Iraqi grades are close in specifications to their Saudi counterparts, and part of this activity by Saudi to fill customer supply quotas for these grades is to make sure that the demand we are still seeing for such Iranian grades from Asia, but mainly China, is not boosted to make up for the shortfall from Saudi. what lies behind the Saudi lies is that Ghawar has peaked. And that is why Aramco is being IPO'd, before the truth comes out about Ghawar . If they actually had that much oil, why would they sell any part of Aramco ! Matthew Simmons warned us almost two decades ago that the Saudis were lying about their proven reserves. , and he was demonized by Mainstream media. They lie because their fields are dry . The fact they need an Aramco IPO and are resorting to fracking tells you their fiction about reserves is just made up out of Clown Prince Bin Salman . When the Saudis announced after a day or two that production was back to normal, I thought: "No way ". Just getting new equipment is going to take weeks to months, unless they cannibalize other production sites. Building a new refinery takes about five years. So yes, repairs will take a few months before everything is back in order. Like the old expression, every cloud has a silver lining, it might be a golden one for Russia and even the shale oil and gas producers in America might break even. The Houthi appear to be like the mouse that roared against the Saudi elephant or should that be camel.








The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists , researchers , Whistelblowers , truthers and many more