Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy

Saudi Arabia is the most important

oil producing nation in history. The secretive Saudi government repeatedly assures the world that its oil fields are healthy beyond reproach, and that they can maintain and even increase output at will to meet skyrocketing global demand.

But what if they can't?

Twilight in the Desert looks behind the curtain to reveal a Saudi oil and production industry that could soon approach a serious, irreversible decline. In this exhaustively researched book, veteran oil industry analyst Matthew Simmons draws on his own three-plus decades of insider experience and more than 200 independently produced reports about Saudi petroleum resources and production operations. What he uncovers is a story about Saudi Arabia's troubled oil industry, not to mention its political and societal instability, which differs sharply from the globally accepted Saudi version.

It's a story that is provocative and disturbing, based on undeniable facts, but until now never told in its entirety. Twilight in the Desert examines numerous aspects of Saudi Arabia and its looming oil crisis, including:

• The seventy-year history of modern Saudi Arabia, and the truth behind its troubling mix of monarchy, conservative Islam, severe social restrictions, and economic contradictions
• Why the geological phenomena that created Saudi oil invincibility now threaten to bring it to an end, far sooner than the world has been led to believe
• A field-by-field assessment of twelve key Saudi oil fields, and how verified shortfalls in their production and potential stand sharply at odds with unverifiable Saudi rhetoric

While Saudi officials promise to increase production from current levels if necessary, Twilight in the Desert examines the history of other major oil fields to determine that Saudi Arabia is in fact overproducing its primary resources, and couldn't possibly ramp up production for long. It calls for long-overdue transparency on the part of the Saudis and all significant global oil producers, along with urgently needed energy data reform, and a global energy blueprint for how the world will cope once Saudi oil output has peaked.

Without question, Saudi Arabian oil fields provide the rest of the world with its most plentiful, low-cost oil resource. The question is how long can they continue to keep these critical pipelines open. Twilight in the Desert answers that question with keen examination instead of unsubstantiated posturing, and takes its place as one of the most important books of this still-young century.

Sparked by personal observations of Saudi oil wells which led him to suspect that some Saudi fields were in decline, the author has created a compelling case that Saudi Arabia production will soon reach an apex, after which its production will decline and the world will be confronted with an immense and potentially catastrophic oil shortage.

Discusses the fate of the Saudi Arabian oil industry and how it will effect the global economy.

An international bestseller, Twilight in the Desert has generated a firestorm of media attention from publications such as the Los Angeles Times, BusinessWeek, the Wall Street Journal, and even a cover story in the acclaimed New York Times Magazine. Written in a clear and engaging style, Twilight in the Desert provides an in-depth look at the world oil market and the mismanagement of Saudi oil resources. This factually-based book is backed by over 200 technical papers, all published over the last 20 years, that individually detail problems with particular Saudi oil wells and fields, and collectively demonstrate how the entire Saudi system could stall under the pressure of higher world oil demand. Twilight in the Desert shows that even under the most optimistic scenario, Saudi Arabia may be able to maintain current rates of production for several years, but will not be able to increase production enough to meet the expected increase in global demand. Eventually, the reckoning day will come, and the world economy will be confronted with a major shock that will stunt economic growth, increase inflation, and further destabilize the Middle East. In short, Twilight in the Desert is a warning call that the era of cheap oil is over, a development that will profoundly affect the world economy and the lifestyles of individual consumers.

MATTHEW R. SIMMONS is Chairman of Simmons & Company International, a Houston-based investment bank that specializes in the energy industry. He now focuses on research, writing, and speaking engagements. Last year, he gave seventy-five speeches to a variety of groups, including energy industry conferences, university symposiums, and think tanks. Mr. Simmons is a member of the National Petroleum Council, a board member of Resources for the Future, and a Trustee of The Atlantic Council of the United States. He has an MBA from Harvard University.

Illustrations.

Preface.

Acknowledgments.

PART ONE: FROM BEDOUIN TO BOURGEOISIE.

1. The Birth of a Nation.

2. The History of Major Saudi Arabian Oil Discoveries.

3. Saudi Arabia’s Road to Oil Market Dominance.

4. The Veil of Secrecy over Saudi Oil Reserves and Production.

PART TWO: THE EBBING OF THE SAUDI OIL BOUNTY.

5. Saudi Aramco.

6. Oil Is Not Just Another Commodity.

PART THREE: GIANTS AT THE TIPPING POINT.

7. Ghawar, the King of Oilfields.

8. The Second-Tier Oilfields.

9. The Best of the Rest.

10. Coming Up Empty in New Exploration.

11. Turning to Natural Gas.

PART FOUR: TWILIGHT IN THE DESERT.

12. Saudi Oil Reserves Claims in Doubt.

13. Facing the Inevitable.

14. Reading Between the Lines of the Latest News from Aramco.

15 Aramco Invokes “Fuzzy Logic” to Manage the Future of Saudi Oil.

16 In Search of Crisper Truths among the Confident Saudi Claims.

17 Aftermath.

Appendix A: Methodology.

Appendix B: Supporting Technical Data.

Appendix C: The 1974 and 1979 Senate Hearings.

Notes.

Bibliography.

Index.