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Will Saudi Arabi flood the oil market to keep their heads on their shoulders?

February 23, 2011

Expect Saudi Oil Production to go up as fast as it fell

Saudi Arabi is the worlds biggest swing supplier of oil – they can decide to change the amount of oil supplied at to the world markets at nearly any time.  As recently as 2009, they were supplying about 1 million barrels more every day.

They will try to keep their heads on their shoulders in any way they can.  To prove this, about 6 moths ago they announced a $385bn, 5 year jobs program.  At 25k a job, this is 2.8m jobs, when the GDP per capita is only 23K.  You know that GDP isn’t spread equally per capita, so the average cost per job may be even less.  This is in a country with only 25m people.

I don’t know if this will be enough to keep a lid on oil prices.  I am just saying that the odds are very, very high that the Saudi Arabia is already pumping oil at a far greater rate than the most recent numbers show.

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  1. April 4, 2011 at 12:15 pm
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