Saudi Arabia won’t act alone to support oil prices - sources

Oil&Gas Materials 19 July 2016 18:20 (UTC +04:00)

Baku, Azerbaijan, July 19

By Aygun Badalova – Trend:

Saudi Arabia, which is the largest oil producer and exporter within OPEC, will not take any action alone to support the prices to go up, International Oil Daily (IOD) reported referring to an OPEC delegate.

"Sure, Saudi Arabia might want a higher price but this doesn't mean that at this point they will do anything about it, and besides, they will never take an action alone. It will have to be collective and may even include non-OPEC members,” a Gulf OPEC delegate told IOD.

Last week, Saudi Energy Minister Khaled al-Falih told German daily Handelsblatt that an oil price higher than $50 per barrel would be needed to achieve a balance in oil markets in the long term.

He said that a fair oil price was somewhere between $50 and $100 a barrel.

“Everybody agrees the $50 price is a low price for investment and for revenues. No question. But there is no indication that the Saudis have a change in their policy for dealing with the market situation, with prices,” said a second Gulf OPEC delegate.

Meanwhile, a non-Gulf OPEC delegate said Al-Falih's comments could mean that Saudi Arabia had enough of low prices and may be thinking of making a balance between their share in the market and the price they want.

Oil prices steadied above $47 a barrel on July 19 helped by a new Libyan supply disruption, but concerns over a global glut of crude and refined fuel capped gains, Reuters reported.

Brent crude LCOc1 was up 26 cents to $47.22 a barrel as of 12:25 GMT, after falling 65 cents, or 1.4 percent, on Monday. WTI, CLc1 rose 18 cents to $45.42 a barrel after settling 71 cents, or about 1.6 percent, lower in the previous session.

OPEC’s total oil output increased significantly in June by 264,100 barrels per day to 32.858 million barrels per day month-to-month, according to cartel’s latest Oil Market report.

Crude oil output increased mostly from Nigeria, Iran, Saudi Arabia, Libya and UAE, while production showed declines in Venezuela and Iraq.