The Saudi foreign minister said there was nothing more the kingdom could do to calm oil markets, implying that the world’s largest black gold exporter has no plan to accelerate a gradual increase in production, Bloomberg reported.
“There is no shortage of oil as far as we know,” Prince Faisal bin Farhan Al Saud said at the World Economic Forum in Davos. – We need to make sure that with the transition to renewable energy, there will be enough energy on the market. The kingdom has done everything it could.
This was the answer to the question what the US, which puts pressure on Saudi Arabia and other OPEC+ members to produce more oil, could offer Riyadh in exchange for more production of the strategic energy carrier.
His comments echoed statements by Saudi Energy Minister Abdul-Aziz bin Salman al-Saud, who said in an interview this month that the refining crisis is to blame for the spike in fuel prices.
“It’s much harder than just getting barrels to the market,” Prince Faisal noted in Davos, Switzerland. – Our assessment is that the supply of oil is actually in relative equilibrium right now.”
Oil prices rose nearly 70 percent last year, to around $110 a barrel, first because demand recovered from the Covid-19 coronavirus pandemic and then because of the geopolitical crisis around Ukraine. The Organization of Petroleum Exporting Countries (OPEC) and its partners, a group of 23 countries led by Saudi Arabia and Russia, are increasing daily crude production by about 430,000 barrels each month. Major importers, including the U.S. and Japan, have called on the alliance, known as OPEC+, to ramp up production and fuel supplies to the world market. Meanwhile, the group is struggling to meet even its current monthly target and many OPEC+ members are producing below their allotted quotas, Bloomberg notes.
U.S. gasoline and diesel prices have hit record highs in recent weeks, spurring inflation, putting pressure on U.S. President Joe Biden ahead of the Nov. 8, 2022 midterm elections for the U.S. Congress.
Saudi Arabia and neighboring United Arab Emirates said fuel prices have jumped so much because of lack of investment in refineries around the world over the past few years. They argue that increasing crude output will do little to help the market because refineries are mostly running at full capacity.