Saudi oil chief to comment on possible production boost
RIYADH, Saudi Arabia – Saudi Arabia’s oil minister today will address reports that the world’s largest oil-producing country is set to raise production by about 500,000 barrels per day, his adviser said.
The increase would bring Saudi Arabia’s oil production to 10 million barrels a day, the country’s highest ever, according to reports by the New York Times and the Middle East Economic Survey, an industry publication.
Adviser Ibrahim al-Muhanna told the Associated Press on Saturday that he could not confirm the reports, but added: “Minister Ali al-Naimi will clarify this tomorrow.”
Saudi Arabia has called for a meeting of oil producing and consuming countries on June 22 in the port city of Jiddah to discuss ways of dealing with soaring energy prices.
The New York Times report on Saturday, citing unnamed analysts and oil traders briefed by Saudi officials, said the production increase was to be announced following the meeting.
The Middle East Economic Survey said Friday that Saudi Arabia was considering a production increase, but did not provide a source.
The Saudis are concerned that sustained high oil prices will eventually slacken the world’s appetite for oil, affecting them in the long run.
Crude prices have reached record highs, surpassing $139 per barrel on June 6 after surging nearly $11 in the biggest single-day price leap ever.
The prices had receded by Friday, with the benchmark light, sweet crude for July delivery falling $1.88 to settle at $134.86 on the New York Mercantile Exchange. In London, July Brent crude lost $1.84 to settle at $134.25 on the ICE Futures exchange.
Even with record highs in the U.S., gas prices remain far cheaper than in Europe and some parts of Asia. Oil-related protests have swept Europe, with fishermen staging strikes in Spain, Portugal, France, Belgium and Italy. Several Asian countries, including India, Indonesia and Malaysia, have slashed fuel subsidies, raising prices for millions of consumers and sparking demonstrations.
Wrapping up a summit in Japan on Saturday, finance ministers from the Group of Eight nations – Britain, Canada, France, Germany, Italy, Japan, Russia and the U.S. – urged oil-producing nations to increase production.
Also Saturday, U.N. Secretary-General Ban Ki-moon met with King Abdullah in Saudi Arabia to discuss soaring oil prices and other regional issues, according to the official Saudi Press Agency.