No, not necessarily. There are issues such as letting a field rest to avoid water break throughs and other production constraints that take time to over-come. Staniford mentions that there are other fields and that nobody is this pessimistic (i.e. the production decline will continue until production is zero) about Saudi reserves.

As for the reports of increasing reserves, Staniford has several sources that all show a decline. While the actual levels might be in dispute he figures the trends are more likely accurate at least in qualitative terms.

And the trick is that the Saudis prefer to tell their story themselves, considering their oil reserves a matter of national security. No matter how helpful it might be to investors to have precise and verified numbers, that's not the Saudis' main interest. So, at best we're working with imperfect information.

Given the level of foreign investment in Saudi oil, one has to conclude that a) oil companies place a high level of trust in Saudi figures or b) oil companies are dumb as bricks. If one bases one's conclusion on the general success of oil companies, you have to lean toward a). 'Peak oil' analyses, however, tend to come from contrarian investment analysts with rather transparent objectives.

Again, I'll have to cite the NY Times piece on Saudi reserves, and other media media reports that the KSA is, in fact, increasing oil production.