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To: SJS who wrote (12718)	9/20/2000 8:33:19 PM
From: Bill Holtzman	Read Replies (1) \| Respond to of 24042

<OT Oil> I heard SPR is only good for a month or so. Bill

To: SJS who wrote (12718)	9/21/2000 2:06:14 PM
From: Gerald Walls	Read Replies (1) \| Respond to of 24042

What if OPEC was pumping 90-95% of their capacity right now, and that it's not barrels in the ground, but a lack of infrastructure (ships, refinery's, etc) that can't keep up with demand. This commentary partly agrees and partly disagrees with what you say: cato.org [snip] First, the belief that the oil fields are running dry is nonsense. Proven reserves (that is, oil that can tapped and marketed today at a profit) are 15 times larger today than they were in 1948. Moreover, given present consumption levels, the Energy Information Administration reports that oil fields could last another 230 years before running dry and that unconventional petroleum sources (tar sands, shale, and the like) could meet present demands for an additional 580 years. The key, however, is price. When prices are low, a lot of that oil will remain in the ground. With prices at today's level, that oil becomes highly profitable to bring to market. It takes time, but once the industry is convinced that high prices aren't some sort of mirage, that oil will flood the market. Are these prices a mirage? Well, they're real enough, but they don't reflect underlying realities about the availability of oil. Although the Saudis are producing 8 million barrels a day at a cost of $1.50 a barrel, they were churning out 10 million barrels a day during the Gulf War and have the capacity to go as high as 16 million barrels a day if they wished, at no increase in marginal cost. While it's true that the rest of OPEC is producing at near capacity, OPEC is less a cartel than it is one dominant market leader — Saudi Arabia--and a collection of moderately influential followers. [snip]