Saudi eyeing steps to cut crude prices

DUBAI: Saudi Arabia is concerned about high oil prices and will take steps to moderate them, its oil minister said in a statement some in the market read as a signal to consumer nations that there is no need to release emergency reserves.

“Saudi Arabia is concerned about rising prices. The current high price is not supported by market fundamentals,” Ali Al Naimi said yesterday.

“We will take steps to ensure the market is well supplied, help moderate prices and meet any additional demand from our customers,” he said four days after US officials met energy analysts.

The meeting was read by some as a sign that President Barack Obama is considering tapping US supplies to bring down prices in the run-up to the presidential elections in November.

The International Energy Agency, which co-ordinates oil stocks in the West, has been cool on the idea.

The last stock release after Opec’s acrimonious June 2011 meeting angered officials, who viewed it as meddling in the market and destabilising prices.

Brent crude oil prices have surged about 20 per cent since Opec last met in June, hovering around $112-$117 a barrel since mid-August. Lower supplies from Iran because of sanctions and outages in the North Sea have outweighed slowing global economic growth.

“The forward cover remains within an acceptable range and inventories are more than adequate. We will continue to work with other GCC nations and Opec to defend market stability,” he said.

Gulf Opec price doves have in the past blamed financial market speculation when oil prices have spiralled despite increases in supply.

gulf-daily-news, September 11, 2012