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Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

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Protect The Oil: Trump’s Top Priority In The Middle East

Saudi Arabia and the United States will work together to protect the world’s oil supply from threats, the energy ministers of the two countries said after a meeting in Riyadh.

The Saudi Press Agency reported that the two officials had also discussed the role of OPEC and non-OPEC producers in securing the world’s energy needs, as well as ways to strengthen economic ties between the United States and Saudi Arabia.

The issue of oil supply security in the Persian Gulf and Saudi Arabia specifically came to the fore last month, after drone and missile attacks on a Saudi oil field and a processing facility took close to 6 million bpd in production capacity off the market, leading to a price spike and worry about supply.

At the time, Saudi Arabia and the U.S. blamed the attacks on Iran, which rejected the accusations. The Houthi rebels took responsibility for the attacks. This led to an increase in regional tensions, fueling more concern about the security of oil supply in one of the biggest producing regions.

Following the attacks, Saudi Arabia and the United States started talking about stepping up their security partnership including by connecting Saudi missile defense systems to the U.S. ones and exploring new anti-drone technologies. Related: Tesla’s Tipping Point: Breaking Into China

What’s more, the U.S. deployed an additional 2,000 troops, along with jet fighters and three new anti-missile systems to the Kingdom to enhance the security of its ally’s oil fields. According to reports, however, Saudi Arabia would pay the bill for the deployment.

With his recent withdrawal from Syria, plenty of critics have accused Trump of having no clear foreign policy in the Middle East, this agreement and the military build-up suggests that he does have at least one priority: protect the oil.

There were worries Saudi Arabia would not be able to quickly restore production capacity and this would lead to a shortage on the international oil market, but in truth Aramco was pretty speedy with the resumption of operations. Full capacity should be restored by the end of next month, the company said in its latest update on the situation.

By Irina Slav for Oilprice

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  • Mamdouh Salameh on October 29 2019 said:
    The threat to Middle East oil and also Venezuel’a comes from President Trump. Under the pretext of protecting Middle East oil, President Trump has been blackmailing Saudi Arabia and other Gulf States so as to get his hands on their money.

    After the devastating attacks on Saudi oil infrastructure by the Houthis of Yemen, the United States rushed to accuse Iran for the attacks but failed to retaliate against it. As a result, Saudi Arabia may have reached the conclusion that the United States has been using Iran as a threat to blackmail the Saudis for money.

    The whole Saudi oil industry has become a hostage of the Houthis so to protect them the Saudis have to end the war in Yemen and reach some rapprochement with Iran rather invite US forces to the country and pay the bill for their deployment.

    In Syria, the United States is not only illegally occupying part of Syria and its oil resources, it is also smuggling Syria’s oil and selling it illegally to deprive Syria of its own oil and pay for the deployment of its special forces in Syria.

    In Venezuela, the US is using its intrusive sanctions to effect a regime change and install an America puppet there. The United States has been ogling Venezuela’s huge oil reserves, the world’s largest, for quite a while. But it will fail miserably as it did with the invasion of Iraq in 2003. The United States went there to grab Iraq’s spectacular oil reserves but left empty-handed leaving the field to China and Iran.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London
  • Bill Simpson on October 29 2019 said:
    Those Persian Gulf oil countries have more cash than they can reasonably spend. Steel and concrete lasts hundreds of years in that very dry climate. All the need to do is build a network of giant steel towers, capped off with powerful radars connected to computers. They could see missiles coming for a hundred miles out and send missiles, or soon fire lasers, to destroy the incoming threats. A lot of computerized radar aimed anti-aircraft cannons would work too. I knew a pilot in Vietnam who said the anti-aircraft artillery provided by the Soviets was what they feared the most. The North Vietnamese and Viet Cong could even shoot down helicopters with Soviet RPG-7 rocket propelled grenades. They took classes on how to do it and shot down thousands of US helicopters.
    So instead of trying to see who can build the tallest skyscraper where land is limitless, or outfit 747 flying palace #5, spend some cash on radar towers, like the British used to defeat Nazi Germany during WW II. Without that early warning of Nazi air raids, their air force would have been shot up on the ground, making the way for an invasion across the English Channel while Hitler's air force sunk ships resupplying the UK from the USA. The Royal Air Force and radar saved the UK.
  • bob josephs on November 04 2019 said:
    The author has been consistently wrong for years
    Mamdouh G. Salameh
    PEAK OIL THEORY: A REALITY OR HYPE?
    Director, Oil Economist, World Bank Consultant, UNIDO Technical Expert, Oil Market Consultancy
    Service, Spring Croft, Sturt Avenue, Haslemere, Surrey GU27 3SJ, United Kingdom,
    Tel: (01428) – 644137, Fax: (01428) – 656262, e-mail: mgsalameh@btconnect.com
    Six years into the 21st century, the United States and the world remain heavily dependent
    on the fuel that powered the last 100 years: crude oil. President Bush has gone so far as to
    call that dependence an “addiction”.
    But despite the almost quadrupling of the oil price since 2002, the world still seems
    reluctant to buy into high oil prices anything but the normal fare of Chinese demand,
    temporary shortages of refining capacity, political instability in the Middle East and the
    occasional hurricane. May be we should start looking into the oil prices from a new
    perspective: peak oil.
    Peak oil theory concerns the long-term rate of extraction and depletion in conventional oil
    and other fossil fuels. It states that any finite resource such as crude oil will have a
    beginning, middle, and an end of production, and at some point it will peak. Oil production
    typically follows a bell-shaped curve when charted on a graph, with the peak of production
    occurring when approximately half of the oil has been extracted. With some exceptions,
    this holds true for a single well, a whole field, an entire region, and presumably the world.
    Peak Oil does not mean 'running out of oil', but 'running out of cheap oil'. There is a big
    difference between oil supplies not running out, and supply meeting demand.
    Many experts think the peak in global oil production could be reached some time between
    now and 2010, others that it will come between 2010 and 2020. My own research, however,
    indicates that the peak had already been reached in 2004 if we factor in what I describe as
    “OPEC’s inflated proven oil reserves”.
    Even the US army now predicts that global oil production is at or near peak and that current
    global demand exceeds the supply. In a report entitled:” Energy Trends & Their
    Implications for US Army Installations”, it says that the almost quadrupling of oil prices
    since 2002 is not an anomaly but a picture of the future.
    Eight of the top oil producers in the world have already peaked. The only one among the
    top producers that has clear capability to increase production is Iraq once stability is
    restored to the country. In fact of the 65 largest oil-producing countries in the world, up to
    54 have past their peak of production and are now in decline. Moreover, the three largest
    oilfields in the world have peaked: Kuwait’s Burgan peaked in November 2005, Mexico’s
    giant Cantarell in March 2006 and Saudi Arabia’s Ghawar, the largest oilfield in the world,
    in 2006 and is now declining at a rate of 8% per year.
    In the US, discovery peaked in 1930 and production peaked 40 years later in 1970. And
    despite all the technology we hear about, world discovery peaked in 1965 and production of
    conventional oil peaked in 2005 with a time lag of 40 years. As for the Middle East,
    discovery peaked in 1965 and peak production will be reached by 2009. Since production
    has to mirror discovery, it should surprise no one that we now face the corresponding peak
    of production.
    A peak in oil production would manifest itself by rapidly escalating prices, a slowdown in
    production, a growing supply deficit, declining discovery rate of new oil and also a
    declining Energy Return on Investment (EROI) ratio. All these characteristics exist today.
    It is against this background that the concept of peak oil becomes more worrisome.
    This paper will argue that the sustained high oil prices since 2002 might be an early
    indication of a serious global supply-demand imbalance brought about by peak oil. It will
    also argue that all the characteristics of peak oil exist today. It will suggest that
    unconventional oil production may not be able to delay the decline in global oil production
    but could only ameliorate it. It will conclude that peak oil is not only a reality but is already
    impacting on oil prices, the world economy and the global energy security. The paper will
    warn that the days of inexpensive, convenient, abundant energy sources are quickly
    drawing to a close.

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