By Pumping at Will, Saudi Arabia Hurts Oil Investment

By Pumping at Will, Saudi Arabia Hurts Oil Investment

Even if the de facto leader of OPEC steps back from its threat to boost oil supply by more than 2.5 million barrels a day next month, which seems unlikely, Saudi Arabia has shown that it is willing to use its production capacity as a weapon - not to restrict supply and raise prices, but to boost it and crash them.. Oil at $30 a barrel, or even at $20, won't stop most fields that are already in production from pumping, no matter where they are.. When oil prices fell to about $10 a barrel in 1999, amid the Asian financial crisis, operations halted at just one small Greek oil field - Prinos - that was pumping just 1,600 barrels a day.. A geographical comparison from the annual reports of four major international oil companies shows that production costs in Russia were about $22 a barrel, including taxes, when oil prices were close to $70 a barrel.. But production costs mean little when it comes to deciding whether to invest in new capacity - even in Saudi Arabia.. In a world where oil prices are driven down to $30 a barrel or lower every few years, investing in new production