Saudi Tosses Oil Production Cap

Ali Naimi, Saudi Arabia's oil minister, also said the kingdom had tossed aside its production cap set by the Organization of Petroleum Exporting Countries and is willing to sell its customers every barrel of oil they want, up to its current capacity of 11 million barrels a day.

In the United States in 1971, the TRC (the equivalent of OPEC for the U.S.) put aside their quota. That was the year that the U.S. peaked :

... Deffeyes said he knew that Hubbert had been right and that the peak for domestic production had been reached when he saw this sentence in 1971 in the San Francisco Chronicle: "The Texas Railroad Commission announced a 100% allowable for next month."

To demystify that sentence, the Texas Railroad Commission was the quaintly named cartel that controlled the U.S. oil industry by making strategic use of the excess capacity for pumping in Texas. When the commission said, "100% allowable for next month," it meant that there was no longer any excess capacity. They were pumping flat-out, and therefore Hubbert's Peak had been reached.

http://pr.caltech.edu/periodicals/CaltechNews/articles/v38/oil.html

- Therefore, the implication in this announcement from the Saudi's is staggering. Peak Oil is either here, very, very close, or ... has already passed by. We will not know for sure until a couple of years later and examine the historical production figures (i.e. Matt Simmons' "rear-view mirror").

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