Saudi Arabia oil minister Ali al-Naimi announced it will increase crude production by as much as 25 percent in the coming weeks,, seeking to allay the concern over supplies that has driven prices to the highest in three years.
Brent crude has gained 15 percent in London this year to about $124 abarrel. Iran has threatened to shut the Strait of Hormuz at the entrance to the Persian Gulf, a transit point for a fifth of the world’s traded oil, in response to sanctions on its crude exports imposed over its nuclear program.
Saudi Arabia's oil minister Ali al-Naimi, also said, “If you believe Hormuz will be closed, I will sell you the Empire State or the Egyptian pyramids.
I want to assure you that there is no shortage of supply in the market. OPEC is supplying what it needs, we have capacity, additional reserves of 2.5 million barrels a day. ”
Saudi Arabia increased production to 10.047 million barrels a day in November, the highest in at least three decades. The kingdom, the world’s biggest crude exporter, has the capacity to produce 12.5 million barrels a day and will pump about 9.9 million barrels a day this month and in April, al-Naimi told reporters at the Ritz Carlton hotel in the Qatari capital.
Saudi Arabia has excess capacity of 2.5 million barrels a day, the minister said, which makes up the bulk of spare capacity in the Organization for Petroleum Exporting Countries. As much as 1 million barrels a day of exports from Iran, the second-biggest OPEC member, may be lost as embargoes enforced by the U.S. and Europe hinder consumers from buying its oil, the
International Energy Agency said in a report last week.
Brent crude reached a record $147 a barrel in 2008 as unused capacity in OPEC narrowed. As prices rose that year, Saudi Arabia said it could potentially raise output capacity to 15 million barrels a day, from 12.5 million barrels a day, using new oil fields if needed. Al-Naimi met with
ministers from producing and consuming nations last week at the International Energy Forum in Kuwait.
“When I met with the ministers in Kuwait, every one of them mentioned the economy, and the impact of current prices, and the fear that we will have a repeat of 2008,” al-Naimi said. “The situation is completely different today to 2008. It is definitely not the same. There is plenty of supply, there is readiness to supply, and the demand is really not the one that is pulling.”
Brent crude dropped 1.3 percent to $124.12 a barrel on London’s ICE Futures Europe today.
Brent crude has gained 15 percent in London this year to about $124 abarrel. Iran has threatened to shut the Strait of Hormuz at the entrance to the Persian Gulf, a transit point for a fifth of the world’s traded oil, in response to sanctions on its crude exports imposed over its nuclear program.
Saudi Arabia's oil minister Ali al-Naimi, also said, “If you believe Hormuz will be closed, I will sell you the Empire State or the Egyptian pyramids.
I want to assure you that there is no shortage of supply in the market. OPEC is supplying what it needs, we have capacity, additional reserves of 2.5 million barrels a day. ”
Saudi Arabia increased production to 10.047 million barrels a day in November, the highest in at least three decades. The kingdom, the world’s biggest crude exporter, has the capacity to produce 12.5 million barrels a day and will pump about 9.9 million barrels a day this month and in April, al-Naimi told reporters at the Ritz Carlton hotel in the Qatari capital.
Saudi Arabia has excess capacity of 2.5 million barrels a day, the minister said, which makes up the bulk of spare capacity in the Organization for Petroleum Exporting Countries. As much as 1 million barrels a day of exports from Iran, the second-biggest OPEC member, may be lost as embargoes enforced by the U.S. and Europe hinder consumers from buying its oil, the
International Energy Agency said in a report last week.
Brent crude reached a record $147 a barrel in 2008 as unused capacity in OPEC narrowed. As prices rose that year, Saudi Arabia said it could potentially raise output capacity to 15 million barrels a day, from 12.5 million barrels a day, using new oil fields if needed. Al-Naimi met with
ministers from producing and consuming nations last week at the International Energy Forum in Kuwait.
“When I met with the ministers in Kuwait, every one of them mentioned the economy, and the impact of current prices, and the fear that we will have a repeat of 2008,” al-Naimi said. “The situation is completely different today to 2008. It is definitely not the same. There is plenty of supply, there is readiness to supply, and the demand is really not the one that is pulling.”
Brent crude dropped 1.3 percent to $124.12 a barrel on London’s ICE Futures Europe today.
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