What Peak Oil?

The Wall Street Journal is reporting that Saudi Arabia is pumping record amounts of crude oil in decades to fill the gap left by Libya leaving the oil market.

Saudi Arabia has been pumping oil at its highest level in decades to offset a global shortfall fueled by another hot spot besides Syria: Libya, where unrest has slashed output.

A tumble in Libyan production to depths not seen since a civil war toppled the Gadhafi regime in 2011, combined with fears of a possible U.S.-led military strike against Syria, have sent oil prices sharply higher in recent weeks.

But unlike two years ago—when plunging Libyan output triggered a release of emergency oil stockpiles by the world's biggest consumers—soaring Saudi Arabian, U.S. and Iraqi output is helping cushion the blow, according to the Organization of the Petroleum Exporting Countries, a group of some of the world's top oil producers.

Thank goodness for the Bakken.

And Platts is reporting:

Libya's oil and gas production could be wiped out indefinitely if the Libyan state collapses, Washington-based consultancy PFC Energy said this week, in a stark warning that the country risks falling back into chaos.

In a note to clients late Tuesday, PFC said the country's crude output had plummeted from 1.4 million b/d in early July to as little as 150-250,000 b/d in recent weeks as a result of the protests and shut-ins carried out by quasi-government forces, militias, civilian protesters, and oil and gas sector employees.

Ever since this story was first being reported, maybe six months ago, it was my contention that Libya was getting out of the oil business. Exactly.