The raging fire of Arab anger that erupted in recent weeks is making almost everyone blind to all other issues. Like all people, I have been preoccupied with this fire, and have set aside other news that I believe to be important, but surely less so than the angry uprisings, so that I may return to them once the dust settles. My curiosity was aroused by a news story involving Saudi Arabia and its oil wealth. The material on this subject was extensive, but I read contradictory analyses, and decided in the end to give myself a warrior's rest, in order to fish out the truth about this oil issue. The U.S. Energy Information Administration predicted in its report that global demand for oil will rise by 2035 to 110.6 million barrels per day from its current level of 86 million barrels per day, or an increase of about 30 percent. Before I continue, I want to say that I find long-term forecasts often hard to believe, since they are based on what we know today to make predictions 24 years into the future, as in the U.S. report, without taking into account future inventions, discoveries or scientific breakthroughs that might alter current trends in energy consumption. The U.S. estimates coincided with news about Saudi Arabian oil resources which I found to be self-contradictory. I read that Saudi oil reserves are vastly exaggerated, and that Saudi oil production has peaked, and subsequently, that Saudi Arabia can no longer control the global oil markets. Then I read that Saudi Arabia cranked its production to more than nine million barrels per day, and that the Saudi stance has helped restore calm to the market, stabilizing prices after they had exceeded 100 dollars per barrel. The original article quotes a document leaked by WikiLeaks, which involves an account of a meeting between a U.S. diplomat and a former senior official in Aramco that took place in November 2007, found in a cable sent by the diplomat to the U.S. State Department the following month. The bottom line of the document is that the Saudi expert said that the declared estimates of Saudi reserves of 716 billion barrels, or even 900 billion, including 51 percent that can be extracted, are exaggerated by about 300 billion barrels, or 41 percent, and that as a result, Saudi Arabia's daily production capacity will fall after 2020, when it would have extracted 64 billion barrels from its reserves. I write after I gathered dozens of stories about the WikiLeaks cables, all involving the issue above. However, I found the correct answer in the commentary written by Michael Lynch and published in The New York Times. He said that the cable in question was referring to estimates of undiscovered Saudi oil reserves, as the current estimate of proven reserves is around 267 billion barrels. Thus it is impossible for the actual amount to be 300 billion barrels less than the above figure. Instead, it is lower than the 716 billion barrel figure (or 900 billion), which is reportedly the size of undiscovered reserves in Saudi territory. Many experts failed to notice what Michael Lynch did, that the cable involves forecasted -not confirmed- reserves, as these experts concluded that Saudi Arabia cannot increase its output beyond eight million barrels per day, or the 12.5 million barrels per day that it has reached in the past. I ask here, is it that Saudi Arabia can't or is it that it won't? This was partially answered by the fact that Saudi Arabia increased its output to nine million barrels per day, restoring stability to prices in the process. The rest of the question can be answered by the fact that Saudi Arabia does not need to produce 12 million barrels per day of a finite resource, whether its reserves are at 267 billion or 900 billion barrels. If we consider this issue from the perspective of Saudi Arabia's needs, not those of the global markets, we will find that the kingdom calls for production increase when prices increase. However, increased prices mean that the annual Saudi budget can secure the required funds at a smaller - not bigger - output. Oil is no doubt being depleted. However, it is not the only or indeed the most important resource that is being depleted. The first news story among the set of news that had accumulated on my desk was entitled “What will happen when the well dries up?” dating back to 20/2/2011 in The Observer. The article included two pages with a photograph of a camel drinking water from a small pond in the desert. However, when I finally had enough time to read all the material on the issue, I was surprised to find that the well in this story was a water well, not an oil well, and that the entire topic was about The Blue Peace Report, funded by Sweden and Switzerland for the EU. The report examined long-term water resources prospects for seven countries in the Middle East, including Turkey, Iraq, Jordan, the Palestinian territories, Israel, Syria and Lebanon. In short, there is enough oil in the Middle East to cover both domestic and global consumption in the foreseeable future. However, there isn't enough water in countries that are consistently recording the highest population increase rates in the world. The demographic time bomb seems to have exploded there while those countries were not aware of this. The information I have, which is based on reports, including some frequently issued by the United Nations, prompts me to fear that Yemen will be the first country in the world to run out of water, and I do not know why the Blue Peace Report ignored this country. [email protected]
