Saudi Arabia’s Oil Minister Ali al-Naimi said he wants to see lower crude prices to help stimulate economic growth.
There is “no rational reason” for current high oil prices, al-Naimi said today in an editorial published in the Financial Times, echoing comments he made to reporters in Doha, Qatar on March 20. “Saudi Arabia would like to see a lower price,” he wrote.
Brent crude gained 15 percent this year partly because of concern that tensions between Iran and western nations may reduce exports. The market remains vulnerable to supply disruptions from the Middle East, Jeffery Currie, head of commodities research at Goldman Sachs Group Inc., said today in a report.
“Fundamentally the market remains balanced,” al-Naimi wrote. “It is the perceived potential shortage of oil keeping prices high, not the reality on the ground. There is no lack of supply. There is no demand which cannot be met.”
Saudi Arabia, the largest producer in the Organization of Petroleum Exporting Countries, raised output to the highest level in more than three years in February, according to the International Energy Agency. The nation can increase production by as much as 25 percent immediately if needed, the minister said in Doha last week.
Brent declined 1.3 percent to $123.88 a barrel on the ICE Futures Europe exchange at 5:57 p.m. London time.