Defend Press Freedom

In honor of World Press Freedom Day on May 3rd, we hope you will consider supporting The Media Line this month.
The role of a free press has been at the foundation of democracies around the world for nearly 200 years.
Yet, in many countries, publications are censored and journalists put their lives at risk to report the truth.
A transparent and reliable press covering the important issues of the Middle East is needed more than ever.

The Media Line is proud to assume this responsibility and has over 20 years of success in shaping the role of news reporting in the region. We hope you will support our efforts by making a donation today.

Thank you!

Thank you for confidence in The Media Line.
 
Felice Friedson
Founder, President
Unlocking the Secrets of Aramco
A drilling rig at Saudi Arabia's Shaybah Oil Field. (Courtesy)

Unlocking the Secrets of Aramco

Al-Sharq al-Awsat, London, April 6

There are still those who believe that the international oil market is controlled solely by Saudi Arabia. One of these people is Dr. Fereidun Fesharaki, the founder and chairman of FGE, a global consulting group focusing on the oil and gas markets. Whenever I hear him speak, Dr. Fesharaki emphasizes the fact that oil prices are at their current levels because the Kingdom of Saudi Arabia maintains them that way. Listening to Fesharaki’s lectures will leave one convinced that Saudi Arabia is the sole controller of the international oil market. But this is an unreasonable proposition, first and foremost because Saudi Arabia’s current oil output is about 10 million barrels per day, an amount that constitutes only 10 percent of the world’s daily production. This is a negligible ratio and one that is significantly lower than the Russian share of the global market. So how is Saudi Arabia actually influential? In two ways: First, Saudi Arabia maintains a leadership position within the Organization of Petroleum Exporting Countries (OPEC), which provides Riyadh with at least some leverage over the international oil market. Second, Saudi Arabia commands a vast amount of proven oil reserves. This latter point has been somewhat contested in recent weeks, ahead of Aramco’s expected bond issuance. But unlike some pessimistic analysts, I am not extremely worried. Commentators have warned that the Ghawar field, a major source of Aramco’s oil, might produce much less oil than estimated. But these numbers are fluid. The rate of decline in production at Ghawar is a maximum of 1% per year, while the global rate in other fields is 5%. In addition, even though Saudi Arabia’s oil reserves are smaller than those of Venezuela, the kingdom maintains a higher productivity in the extraction of oil. Not only that, but the quality of its oil is much richer. Furthermore, Aramco has diversified its fields and now relies on a group of fields that complement each other to reach Saudi Arabia’s maximum production capacity of 12 million barrels. Technological inventions will likely push extraction levels even further. Yet despite these huge reserves, the recent debate over Saudi Arabia’s oil reserves should teach us one thing: that even if we remain a major oil producer for decades, we will not have oil forever. Therefore, we must continue diversifying sources of income. This requires major shifts in the way we think about our economy. – Wael Mahdi

Did you know we’re celebrating our 20th Anniversary as the 1st American News Agency exclusively covering the Middle East?

  • The Middle East landscape is changing rapidly.
  • The roads in the region open to new possibilities.
  • The Media Line continues to pave the way to a far greater understanding of the region’s land, people, policies and governments through our trusted, fact-based news.

We’re an independent, ad-free, non-profit news agency and rely on friends like you!

Please make your gift today.
Thank you!

We paved the way to be the Trusted Mid East News you can rely on!

We’re an independent, ad-free, non-profit news agency and rely on friends like you!

Invest in the
Trusted Mideast
News source.
We are on the
front lines.

Personalize Your News
Upgrade your experience by choosing the categories that matter most to you.
Click on the icon to add the category to your Personalize news
Browse Categories and Topics
Wake up to the Trusted Mideast News source Mideast Daily News Email
By subscribing, you agree to The Media Line terms of use and privacy policy.
Wake up to the Trusted Mideast News source Mideast Daily News Email
By subscribing, you agree to The Media Line terms of use and privacy policy.