Low oil prices ‘not Saudi Arabia's battle’

BLACKEAGLE

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Low oil prices ‘not Saudi Arabia's battle’



MOHAMMED RASOOLDEEN

Published — Sunday 17 April 2016
Last update 17 April 2016 3:34 am

RIYADH: The Kingdom will cap its oil market share at about 10.3 mbd to 10.4 mbd if producers agree to the freeze, Deputy Crown Prince Mohammed bin Salman said during an interview with Bloomberg at King Salman’s private farm in Diriyah on Thursday.

Bloomberg released the interview on Saturday, a day before a widely anticipated OPEC meeting in Doha.
“If all major producers don’t freeze production, we will not freeze production,” said the deputy crown prince, who has emerged as Saudi Arabia’s leading economic force. “If we don’t freeze, then we will sell at any opportunity we get.”

At least 15 nations, including Saudi Arabia and Russia, the two largest crude producers, will gather in Doha on April 17 to discuss freezing output to stabilize an oversupplied market.

He said Saudi Arabia’s commitment to a production cap would depend on Iran’s participation. Iran’s oil minister has dismissed the prospect of joining the deal as “ridiculous” for now.

“If prices went up to $60 or $70, that would be a strong factor to push forward the wheel of development,” he said. “But this battle is not my battle. It’s the battle of others who are suffering from low oil prices.”
The deputy crown prince also said that Saudi Arabia isn’t concerned because “we have our own programs that don’t need high oil prices.”

Still, he reiterated that OPEC will gain support once all members reach a collective decision.

A Russian official has said it was possible to reach a deal in Doha to freeze oil output regardless of Iran, whose crude shipments have risen by more than 600,000 barrels a day this month, according to Bloomberg.

Brent crude settled at $43.10 a barrel Friday in London, having rebounded by more than 50 percent from a 12-year low in January.

The Doha meeting follows a meeting in February between Saudi Arabia, Qatar, Russia and Venezuela in which the quartet tentatively agreed to cap their production at January’s level.

The Public Investment Fund is aimed at helping reduce the Kingdom’s dependency on oil. To achieve this, the fund is considering foreign opportunities and will seek a variety of investments. “So within 20 years, we will be an economy or state that doesn’t depend mainly on oil,” he said.

Earlier this month, the deputy crown prince announced plans to dedicate a $2 trillion fund for a post-oil economy in a separate interview with Bloomberg.
Low oil prices ‘not Saudi Arabia's battle’ | Arab News
 

Zepplin

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"freezing output to stabilize an oversuppliedmarket" - If governments agree to this, it is legal.
If business get together and do this, it's illegal: Competition law - Wikipedia, the free encyclopedia

An over supplied market, or more supply than demand should drive prices down for consumers.
They've had it good when it was the other way around, it's only fair if they respect both sides of play
 

Jason76

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I'm amazed Saudi Arabia still has a lot of oil. Once it runs out, then what's the next plan? Anyhow, the US has such stockpiles at home, that it doesn't need Saudi oil. However, a huge market exists in China for Saudi and Russian oil.
 

Zepplin

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I'm amazed Saudi Arabia still has a lot of oil. Once it runs out, then what's the next plan? Anyhow, the US has such stockpiles at home, that it doesn't need Saudi oil. However, a huge market exists in China for Saudi and Russian oil.
Here is a great quote that perfectly sums up your question:
"My grandfather rode a camel, my father rode a camel, I drive a Mercedes, my son drives a Land Rover, his son will drive a Land Rover, but his son will ride a camel" - A former prime minister of UAE
 

explorerx7

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I see that many of the major oil producers are seeking to broker an agreement to ensure better oil revenues. however, it seems that Iran is not inclined to cooperate with this move at the moment. Therefore, I am wondering what impact the Iranian stance will have on this proposed deal. Will it serve to stymie the process that major oil producers are trying to institute?
 

Jason76

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Here is a great quote that perfectly sums up your question:
"My grandfather rode a camel, my father rode a camel, I drive a Mercedes, my son drives a Land Rover, his son will drive a Land Rover, but his son will ride a camel" - A former prime minister of UAE

In that case, they should make an attempt to develop industry to sustain thier land after the oil is gone. Obviously, oil money is big enough to the job. Well, I'm sure they're doing it.
 

Zepplin

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In that case, they should make an attempt to develop industry to sustain thier land after the oil is gone. Obviously, oil money is big enough to the job. Well, I'm sure they're doing it.
You're right.
It is short sighted for anyone not to keep investing their profits and spreading their portfolio to other revenue sources.
Britain with it's lack of affordable natural resources invested in science, technology and (unfortunately) military as exports.
I wonder what they will have to offer? It isn't like they have the best reputation to majorly invest in the tourist industry
 
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