Are the Saudis Saying Drilling in ANWAR is Not Needed?
The GOP was pushing for drilling in ANWAR even when the world market price for crude oil was less than the estimated extraction cost for getting crude oil out of ANWAR. Currently, the market price for crude is about twice this extraction cost and some analysts expect world prices to remain high. One Saudi official has a very different view:
Saudi Arabia has plenty of oil – more than the world is likely to need – along with an increasing ability to refine crude oil into gasoline and other products before selling it overseas, a top Saudi official says. “The world is more likely to run out of uses for oil than Saudi Arabia is going to run out of oil,” Adel al-Jubeir, top foreign policy adviser for Saudi Arabia’s de facto ruler Crown Prince Abdullah, said Wednesday … “If we send more oil to the United States and you can’t refine it, it’s not going to become gasoline,” al-Jubeir said. The United States has not built a refinery since the 1970s, and other markets have similarly outmoded or limited refining capacity.
He seems to agree with Robert Novak on the refinery issue, but Mark Thoma informs us that the good folks at Cato do not agree.