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Saudi sees no need for extra crude oil supplies
Reuters/Ali Jarekji
Saudi Arabia's Prince Salman, brother of Saudi Arabia's King Abdullah, gestures during his arrival at the Arab summit in Riyadh March 29, 2007.AFP
RIYADH
Petroleumworld.com 05 29 07
The surge in oil prices is being driven by political factors and there is no need for additional crude supplies, Saudi Arabia's assistant oil minister said on Monday.
"What brings prices up is politics, what brings them down is politics," Prince Abdul Aziz bin Salman bin Abdul Aziz told AFP, referring to tensions in major crude producers Nigeria, Iraq, Iran and Venezuela.
"We have a well-supplied market," he said on the sidelines of a European-Gulf forum which ended on Monday with a debate on energy security.
"We have always said, and OPEC has always committed itself to keep the market well-supplied and balanced. Never has this market been (more) balanced with crude than today," said Prince Abdul Aziz, who is assistant oil minister for petroleum affairs.
He said that while there was no need for additional crude supplies, there is a problem with refining capacity. He was referring to what Saudi officials say is a need to invest in expanding refining capacity in consumer countries.
OPEC kingpin Saudi Arabia was sticking to its output quota of 8.5 million barrels per day (bpd), he said.
Oil prices in London have risen to almost 72 dollars a barrel, energised by simmering tensions over key crude producers Iran and Nigeria, and weak motor fuel stocks in the United States.
The price of London Brent North Sea crude hit a nine-month peak of 71.80 dollars per barrel on Thursday. Last Monday, the New York oil contract surged to 67.10 dollars per barrel.
Prices edged lower in Asian trade on Monday after Nigeria's oil unions suspended a two-day weekend strike, relieving concerns of possible disruption to shipments, dealers said.
The market remains focused on tight gasoline supplies as the peak-demand US summer driving season got under way on Saturday, they added.
At 0600 GMT, New York's main oil futures contract, light sweet crude for delivery in July, was down 30 cents at 64.90 dollars per barrel from 65.20 dollars in US trades on Friday.
Brent North Sea crude for July shed 23 cents to 70.46 dollars.
Both the US and London markets were closed on Monday.
AFP 28 1522 GMT 05 07
Copyright© 2007 AFP. All Rights Reserved.
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