At maximum production, after more than ten years, we'll see 200,000 barrels per day (corrected, h/t A. Siegel) coming from new offshore rigs. OPEC is currently producing 33.2 million barrels per day, over 40% of global production.
OPEC is poised to reduce oil production by as much as two million barrels per day at an emergency meeting in Vienna on Friday.
"There will be a reduction in production at the next extraordinary meeting of OPEC, and it will have to be a substantial one to get the balance right between supply and demand," current OPEC chief Chakib Khelil said. "If it has to be 1.5 million barrels per day, or two million barrels per day, that's what it will be."
OPEC is acting to immediately stabilize prices in the neighborhood of $70-$90 per barrel, with some hawks such as Venezuela and Iran publicly calling for prices to rebound even more. Just eight years ago OPEC tried to keep prices in the $22-$28 range. As the statements below make clear, they will not allow prices to spend significant time cheaper than they want them to be.
Ecuador's Oil and Mines Minister Derlis Palacios:
'Let's wait for the start of winter, the OPEC meeting and the stabilisation of demand, which should help (prices) recover some,' the minister said. 'It would be ideal if they stabilised over $80.'
Qatar's Oil Minister Abdullah al-Attiyah:
"I personally believe that it (the cut) will be 1 million (bpd) or more ... These are only personal expectations that I cannot confirm,' he said on Al Jazeera television.
Iraq's oil minister:
'In Iraq, we think the fair price is $100. When it was $140, it was too high and could have had negative effects on some economies ... but the fall to below $100 will put pressure on the budgets to countries like Iraq which needs lots of money for reconstruction after years of wars,'
Iran's OPEC Governor:
"The best way to resolve the current crisis in the oil market is cooperation between producers to create balance between demand and supply."
Lee Drolles of the Center for Global Energy Studies explains the bottom line:
"Some countries like Venezuela and Iran need prices above $80 a barrel. The Saudis have a bottom price of about $65 a barrel, but they might go ahead with a cut to keep solidarity within OPEC."
There is nothing we can do supply-wise to lower gas prices. Ending our addiction on all oil, not just foreign oil, is the only legitimate path to energy independence.