oil, at least in the short term In the summer of 2005, Peter Maass of The New York Times reported that Saudi Arabia’s oil minister, Ali al-Naimi, gave an upbeat report in Washington, D.C to a group of world oil officials With oil prices then around $55 a barrel, he said, “I want to assure you here today that Saudi Arabia’s reserves are plentiful, and we stand ready to increase output as the market dictates.” The minister may well have been speaking in earnest But, according to the U S Energy Information Administration, Saudi Arabia’s oil production was 9.6 million barrels per day in 2005 It fell to 8.7 million barrels per day in 2006 and to 8.7 million barrels per day in 2007 The agency reports that world output also fell in each of those years World oil prices soared to $147 per barrel in June of 2008 What happened? Much of the explanation for the reduction in Saudi Arabia’s output in 2006 and 2007 can be found in one field More than half of the country’s oil production comes from the Ghawar field, the most productive oil field in the world Ghawar was discovered in 1948 and has provided the bulk of Saudi Arabia’s oil It has given the kingdom and the world more than million barrels of oil per day for well over 50 years It is, however, beginning to lose pressure To continue getting oil from it, the Saudis have begun injecting the field with seawater That creates new pressure and allows continued, albeit somewhat reduced, production Falling production at Ghawar has been at the heart of Saudi Arabia’s declining output The Saudi’s next big hope is an area known as the Khurais complex An area about half the size of Connecticut, the Saudis are counting on Khurais to produce 1.2 million barrels per day beginning in 2009 If it does, it will be the world’s fourth largest oil field, behind Ghawar and fields in Mexico and Kuwait Khurais, however, is no Ghawar Not only is its expected yield Attributed to Libby Rittenberg and Timothy Tregarthen Saylor URL: http://www.saylor.org/books/ Saylor.org 723