Sheikh Yamani is a little too sanguine about the prospect of potential adoption of new energy-conserving technology and its possible impacts on oil demands, but his interview, from which you extracted a smart quote, says a lot about the Saudi oil price strategy. Essentially, the Saudi ruling class want cheaper prices than the leaders of Iran, Venezuela, and the like because the Saudi ruling class, being aristocratic rulers of artificial states many of whose workers are foreigners with few rights, do not have to answer to social, political, and economic demands from below, of the sort that all leaders of real republican democracies have to face, so the Saudi ruling class can afford to think of keeping prices low in the interest of diminishing the incentives for conversion to more ecological production and consumption in the rest of the world.
<http://www.planetark.org/avantgo/dailynewsstory.cfm?newsid=8054> INTERVIEW - Yamani says OPEC accelerating end of the oil era
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TECHNOLOGY TO SQUEEZE OPEC
Within 20 years, he predicts, technology will have cut deep into demand for transport fuels.
Crude will slump even more heavily than the single-digit prices seen during the last glut, in 1998.
This year's oil price scare will feed rival non-OPEC production, suppress demand and, most damagingly for OPEC, breed new fuel technologies.
He sees hybrid engines for automobiles and hydrogen fuel-cells drastically cutting the consumption of gasoline while big new finds lift crude flows from non-OPEC nations.
"Technology is a real enemy for OPEC. Technology will reduce consumption and increase production from areas outside OPEC."
"The real victims will be countries like Saudi Arabia with huge reserves which they can do nothing with - the oil will stay in the ground for ever."
OPEC, said Yamani, had failed to learn the lessons of the series of gluts and shortages which have marked its turbulent history.
Its leading negotiator during the oil price rises of OPEC's heyday, Yamani says his warnings against pushing crude too high went unheeded.
"I will never forget. It was 1979. I was in Caracas and I said that at this price - it was $28 a barrel at the time - OPEC production will drop, OPEC countries will fight each other. I said production has to be raised to lower prices. They said I was crazy."
While Saudi Arabia, sitting on 100 years of reserves, now favours prices no higher than $25 a barrel, fellow OPEC members remain keen to squeeze their customers for as much short-term revenue as possible.
"There are some members in OPEC who always tried to resist extra production - like Venezuela, Iran, Libya. In OPEC, from day one that has not changed," said Yamani. -- Yoshie <http://montages.blogspot.com/> <http://mrzine.org> <http://monthlyreview.org/>