OPEC in general and the Saudi's in particular have said repeatedly that they can ramp up production by 1.5 to 2 mbs p/d for quite some years now. It is always just coming, but never arrives;
"Oil prices have pulled back from 21-year highs as fears over threats to supplies eased thanks to good news from Opec... Opec said it had the capacity to ramp up production by up to 1.5 million barrels a day..... Only a day earlier Opec said it could not pump any more to cool prices, and that Saudi Arabia, the world's biggest exporter, had spare production capacity but could not raise output immediately."
"[Saudi Oil Minister Ali al-Naimi] said Riyadh was pumping 9.3 million barrels a day of crude and was ready to tap surplus capacity of 1.3 million bpd should it be required. Saudi would meet demand for more than 9.3 million bpd in September, Naimi said. A capacity crunch among members of the Organization of the Petroleum Exporting Countries is a leading factor supporting prices. The International Energy Agency, in its monthly oil market report, said OPEC's sustainable spare production capacity shrank to 600,000 barrels a day in July as the cartel raised output to try to contain prices. 'The thin margin of spare capacity held by OPEC producers has contributed to recent price strength,' said the IEA, adviser on energy to 26 industrialised nations. The IEA figures would mean a buffer of less than one percent on the 82-million-bpd world market, compared to about eight percent in 2002 when spare capacity in OPEC was 6-7 million bpd."
"Saudi Arabia, the world's largest oil producer, can pump another 1.3 million barrels a day and keep that up 'indefinitely,' Adel Al-Jubeir, foreign affairs adviser to the Saudi crown prince, told U.S. reporters. The Saudis are now pumping about 9.3 million barrels a day, up 1 million from earlier this year. 'We have the capacity and are ready to tap into it immediately,' Al-Jubeir said. He called current prices 'absolutely not justified' and said clients have not suggested they are looking to buy more oil. 'There is no shortage,' he said. Wachovia economist Jason Shenker calls the Saudi announcement 'a lot of smoke and mirrors,' an opinion that was reflected in the markets."
I would put it to you that what is keeping prices up is not high inventories (increasingly of the wrong grade of oil?), but a capacity crunch.
What else would explain the over 2 year production plateau we've been experiencing and the extreme price volatility that such slim margins of spare production give? In fact OPEC has admitted as much itself in this slip of the tongue statement;
"Concern about oil supplies was further heightened when the president of Opec, Purnomo Yusgiantoro, gave warning that it was unable to supply more oil to the market."
London Times, 4 August 2004
When the next crisis hits, (and we are always now just one crisis away), and or the Saudi's cannot, as world swing producer, increase volumes to meet needs then we'll really know...
Regardless geology will sooner or later trump any shenanigans, and even the best field management.