The very worst oil scenario ever

A news report came out this Monday from Reuters, which was closely — literally — following the G7 meeting in Germany. It was the stuff that media dreams are made of (often deliberately). A casual conversation between two world leaders caught on camera.

In this conversation, French president Emmanuel Macron told U.S. president Joe Biden that the UAE is producing oil near capacity and that Saudi Arabia could only add less than 200,000 bpd to its current production level.

"I had a call with MbZ," Reuters quoted Macron as saying, referring to Sheikh Mohammed bin Zayed al Nahyan. "He told me two things. I'm at a maximum, maximum (production capacity). This is what he claims."

"And then he said (the) Saudis can increase by 150 (thousands barrels per day). Maybe a little bit more, but they don't have huge capacities before six months' time," the French president apparently added.

Just how huge the implications of this relayed conversation could be is evident in this neat spare production capacity table released by Reuters in March, based on data from the International Energy Agency.

According to this neat table, Saudi Arabia has a spare capacity of 1.3 million barrels daily that could be put into exploitation quickly, in a matter of weeks. It also, per the table, has a capacity of another 2.1 million bpd that could be tapped within 90 days. And suddenly the UAE’s ruler goes and tells Macron this is not exactly true. It’s not just him, either.