Saudi Arabia denies oil-production increase; reaffirms cut to continue till end of 2023
Saudi Arabia categorically denied on Monday the recent reports about discussions being held with regard to oil output increase, reaffirming that the OPEC+ decision to cut production would continue to remain until the end of 2023.
Energy Minister Prince Abdulaziz bin Salman said that there was no basis for the recent reports that Saudi Arabia is discussing with other OPEC+ producers about an output increase of 500,000 barrels per day (bpd).
“It is well known, and no secret, that OPEC+ does not discuss any decisions ahead of its meetings. The current cut of two million bpd by OPEC+ would continue until the end of 2023 and if there is a need to take further measures by reducing production to balance supply and demand, we always remain ready to intervene,” he added.
The 33rd OPEC and non-OPEC Ministerial Meeting, held in Vienna, decided on October 5 to cut the production by two million bpd effective from November as part of the measures to ensure oil market stability and avoid volatile situations in the global market.
The Vienna meeting also decided to extend the “declaration of cooperation” until the end of 2023, provided that ministerial meetings will be held every six months.
Prince Abdulaziz emphasized after the Vienna meeting that “what we are doing is essential for all oil exporters, even outside of OPEC Plus, which will remain a major force for the stability of the global economy.”
The energy minister noted that “the amount of uncertainty we are currently experiencing is unprecedented. The current situation makes it difficult for large consumers to resort to the paper market.”
Prince Abdulaziz also noted that the agreement to cut oil production was not made in order to raise prices, but rather for the sustainability of markets.
“Oil prices did not surge compared to other energy prices such as coal and gas, thanks to the OPEC+ and the effectiveness of its decisions. The group's goal is to create a disciplined market that serves its real objective, as liquidity in the markets was affected by sharp fluctuations that caused prices to surge,” he added.
“It is well known, and no secret, that OPEC+ does not discuss any decisions ahead of its meetings. The current cut of two million bpd by OPEC+ would continue until the end of 2023 and if there is a need to take further measures by reducing production to balance supply and demand, we always remain ready to intervene,” he added.
The 33rd OPEC and non-OPEC Ministerial Meeting, held in Vienna, decided on October 5 to cut the production by two million bpd effective from November as part of the measures to ensure oil market stability and avoid volatile situations in the global market.
The Vienna meeting also decided to extend the “declaration of cooperation” until the end of 2023, provided that ministerial meetings will be held every six months.
Prince Abdulaziz emphasized after the Vienna meeting that “what we are doing is essential for all oil exporters, even outside of OPEC Plus, which will remain a major force for the stability of the global economy.”
The energy minister noted that “the amount of uncertainty we are currently experiencing is unprecedented. The current situation makes it difficult for large consumers to resort to the paper market.”
Prince Abdulaziz also noted that the agreement to cut oil production was not made in order to raise prices, but rather for the sustainability of markets.
“Oil prices did not surge compared to other energy prices such as coal and gas, thanks to the OPEC+ and the effectiveness of its decisions. The group's goal is to create a disciplined market that serves its real objective, as liquidity in the markets was affected by sharp fluctuations that caused prices to surge,” he added.