Saudi Arabia’s representative at OPEC said that oil prices are not likely going to rebound to the record high levels that it reached over the past couple of years.
At a recent energy conference, Mohammed al-Madi, Saudi’s OPEC governor, said that it will be “difficult” for oil to reach the $100 to $120-a-barrel level again.
He also said that the Saudi Arabian oil policy has no “political dimension”.
Of all the OPEC nations, Sudi Arabia is the largest producer and has the most clout.
The price of oil has plunged over the past several months.
When asked if prices will rebound again, Mr Madi said:
”$100-$120 – I think it’s difficult to reach $120 another time.”
Mr Madi also denied claims that Saudi Arabia was allowing oil prices to plunge for competitive reasons. Iran has strongly criticised Saudi Araba’s stance on not cutting production to support the price of oil.
Saudi Arabia wants non-OPEC producers to cooperate with the group
However, according to Saudi oil minister Ali al-Naimi, the plan has not worked so far.
“Today the situation is hard. We tried, we held meetings and we did not succeed because countries (outside OPEC) were insisting that OPEC carry the burden and we refuse that OPEC bears the responsibility,” Naimi told reporters.
“The production of OPEC is 30 percent of the market, 70 percent from non-OPEC…everybody is supposed to participate if we want to improve prices.”
Naimi says that there is “no conspiracy” behind the country’s oil policy
“There is no conspiracy and we tried to correct all the things that have been said but nobody listens,” Naimi said.
“We are not against anybody, we are with whoever wants to maintain market stability and the balance between supply and demand, and (with regards to) price the market decides it.”
Oil prices recovered slightly since January but fell again over concerns of an oversupply in the world’s largest oil consumer
Oil prices recovered slightly since January to just over $60 a barrel. However, prices fell again in recent days after a much larger than expected crude stock build in the United States.
On Friday Brent crude closed at $55.2 a barrel and US oil closed at $46.5.
OPEC is an oil cartel. Twelve member nations get together periodically and try to fix the global price of oil in their favor.