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A thousand thanks to Madoc Pope at The Bar for this incredible piece by Kevin Drum. I'd always thought of Kevin Drum as--well, not exactly a hack, but a bit of a shallow reporter. Don't know why. Clearly, I was very much wrong. This article is very, very good.

Ghawar, a uniquely gigantic field which all by itself accounts for more than half of Saudi Arabia's output, has been in production since 1951. A massive water injection program was begun in the early '60s, and today more than 7 million barrels of seawater are required daily to keep Ghawar going. Even at that, though, the best evidence indicates that Ghawar's production may have already begun declining.

This sort of thing is very far from the Carter-era Greenpeace "we're running out of oil!" panic stuff. But it's almost scarier that world oil production will begin to slowly decline just as China's demand is jumping. And if China's recent belligerence to Japan is any indication, things could get...tense. But I love to speculate about China in inappropriate context.

In any event, Drum really only approaches partisan rancor an one point, when he compares the Saudi's possible over-reporting of their oil reserves to Saddam's over-reporting of his WMD capability. The rest of it is even and thoughtful.

I very much like the distinction Drum draws between projected oil production and what can actually be churned out. If we've learned anything from Enron, Dilbert, and our own jobs, for the cube-dweller barflies, it's that long-term projections mean precisely jack shit. And the way practically everyone has a universally rosy picture of future oil production seems a bit, well, desperate.

Of course liberals have been wrong about this before, as President Carter could tell us. But I'm inclined to believe that seeing the first real declines in global production in 2040 is the *pessimistic* guess. And guys--I plan to still be around in 2040.

Further, a century of inexpensive oil has turned the American economy into the fiscal equivalent of, and I don't think this is unfair to say, a crack whore. If the increasing demand from China converges with a production decline the way it looks like it will, that could come back to haunt us.