Wednesday, January 2, 2013
The above graph shows the oil production of Saudia Arabia (top panel) and Iran and Iraq (lower panel). You can see the sanctions-induced deterioration in Iran's production, as well as the beginning of the rise in Iraqi production which I expect to go on in fits and starts for many years, assuming the country can remain politically stable. Iraq has now surpassed Iran in production to become OPEC's second largest producer.
In the meantime, Saudi Arabia, after reaching a new production high in mid 2012 has been slightly ramping back production in the last few months.
In each case, the lines on the above graph are the averages of the available sources. I posted the details on Iran the other day. The Saudi graph is here:
It's interesting that the rig count is hitting new highs suggesting that ongoing investment is new/replacement capacity is significant.
The Iraqi graph is here: