April 19 (Bloomberg) -- Saudi Arabia, facing calls from oil- consuming nations to pump more crude, has no plans to raise output because increased supply wouldn't damp record prices, Argus reported, citing Oil Minister Ali al-Naimi.

Adding the country's spare supplies would ``destabilize'' the market by flooding it with oil that isn't needed, al-Naimi said, according to Argus. Pressure to raise output is ``probably politically driven,'' he said.

Crude oil prices have doubled in three years, touching a record $116.97 a barrel yesterday in New York. Saudi Arabia, the only member of the Organization of Petroleum Exporting Countries to have spare output capacity, can add more than 1.6 million barrels a day to production. The country pumped 9.2 million barrels a day in March, according to Bloomberg estimates. The other 12 members are close to capacity, Bloomberg data show.

The rising oil price is ``absolutely'' unrelated to supply and demand fundamentals and is caused by investors using it as a hedge against the falling value of currencies, al-Naimi said, according to Argus.

Saudi Arabia, the world's largest oil exporter, has no plans to raise output to more than 12.5 million barrels a day, which will be achieved by 2009, he said. Projected oil consumption to 2020 doesn't require more crude from the country and estimates for demand are decreasing, he said. Saudi Arabia's King Abdullah said earlier this month that the nation's new oil discoveries must be saved for the benefit of future generations.

Bringing new oil capacity on-stream is becoming more expensive, at around $5,000 to $8,000 per barrel a day from $2,000 per barrel a day ``in the past,'' Al-Naimi said, according to Argus. The depletion rate of Saudi fields is 2 percent to 3 percent at most, he said, Argus reported.

To contact the reporter on this story: Ayesha Daya in Dubai at adaya1@bloomberg.net

Last Updated: April 19, 2008 09:39 EDT