Saudis slam non-Opec players, say oil markets will recover
SAUDI Oil Minister Ali Al-Naimi said yesterday he was confident world prices would improve after a slide which he blamed partly on a "lack of cooperation" by producers outside the Organisation of Petroleum Exporting Countries (Opec) cartel.
"I am confident that oil markets will recover...and that oil prices will improve," he told an energy forum in Abu Dhabi.
He said the sharp drop in prices - the biggest market slump in years - was partly due to the "lack of cooperation by main producing countries outside Opec, misleading information and speculators' greed".
Mr Al-Naimi, whose country is Opec's leading producer, said producers from outside the cartel would eventually "realise the importance of cooperation to secure new fair prices".
He predicted that "high-cost producers will not continue to increase production", in a clear reference to shale and sand oil output from North America.
The market slide has triggered conspiracy theories ranging from the Saudis seeking to curb the United States oil boom, to Riyadh looking to undermine Iran and Russia for their support of Syria.
Mr Al-Naimi dismissed claims of a Saudi "plot", insisting that the kingdom's policy is "based on pure economic principles".
"Recently, certain analyses and articles have spoken of a politically-motivated Saudi plot, using oil and its prices against this country or that...This is baseless," he said.
His remarks yesterday marked the second time in three days that he hinted the world's biggest crude exporter would not alter output levels but, rather, aimed to allow the market to stabilise on its own.
Suhail Mohammed al-Mazroui, Oil Minister of the United Arab Emirates (UAE), a close Saudi ally, urged all the world's producers not to raise their oil output next year, saying this would quickly steady prices. He did not elaborate.
The world is forecast to need less Opec oil globally next year because of the rising supply of US shale oil and other competing sources, with no significant increase in world demand growth.
At a meeting last month, Opec kept its target output of 30 million barrels per day (bpd) unchanged, leaving the market to balance itself without the group's intervention.
That stance was seen as a shift from a longstanding policy in which Opec powerhouse Saudi Arabia has acted as a swing supplier.
Asked about possible cooperation between members of Opec - which include the world's lowest-cost producers - and non-member countries, Mr Al-Naimi replied: "The best thing for everybody is to let the most efficient producers produce."
He also said that Opec's decision would ultimately help the world economy.
"Current prices do not encourage investment in any form of energy, but they stimulate global economic growth, leading ultimately to an increase in global demand and a slowdown in the growth of supplies," he said.
Iraq's Oil Minister, Adel Abdel Mahdi, said he saw no need for an Opec emergency meeting but "we have to wait and see" whether the group was right to keep output unchanged.