Indonesia leaving OPEC

According to a story that ran in the WSJ on Wednesday, Indonesia now is only a marginal net oil exporter, and its energy minister has announced it will leave the Organization of Petroleum Exporting Countries (OPEC) at the end of 2008.

One odd aspect to the story, in the second paragraph, reporter Tom Wright refers to Indonesia as "Asia's only OPEC member." Presumably he meant "East Asia" there. Obviously, Saudi Arabia, the United Arab Emirates, etc. are in Asia. I wonder how that got past the editors.

Jeff Matthews, on his blog, employs this announcement as an object lesson in "peak oil," the theory that the world has passed the peak in oil production, it's all downhill from here.

Indonesia's oil fields were once quite a big deal in the over-all global industry. They were the foundation of Royal Dutch/Shell. Indonesia's production peak came in 1977 in 1977, when it was extracting 1.7 million barrels a day of the best stuff: more formally known as "light sweet crude."

Indonesia's remaining production is 0.2 million barrels a day. Simle arithmetic gives us a difference of 1.5 million barrels -- or the loss of as much oil as we get from Prudhoe Bay, Alaska.

The planet Earth isn't a donut with a huge jelly-like center of light sweet crude. Get used to it, people!