The Saudi Minister of Petroleum and Mineral Resources, Ali bin Ibrahim Al-Naimi and visiting U.S. Secretary of Energy Abraham Spencer held a joint press conference in Riyadh on Wednesday.
At the outset of the conference, Al-Naimi said that relations between OPEC countries and oil consumers are strong. He noted that non-OPEC producers have no production quotas but are concerned to maintain fair prices. He said that the $22-28 range is satisfactory to all parties, and that today’s price of $25 per barrel is fair. OPEC and non-OPEC exporters such as Mexico, Norway, Angola and Russia are cooperating to curb overproduction, which negatively affects prices.
With regard to OPEC’s recent decision to reduce output, Al-Naimi said there were several options, including reducing output by three million barrels per day to the previous ceiling of 24 million b/d. If we had chosen this option, more oil would have been withdrawn from the supply, which would have led to price hikes, he said, adding that the Kingdom’s objective is to preserve the current price of $25 per barrel. He said that OPEC wants to reduce output by approximately two million b/d, and to keep the price within the OPEC-designated range. Therefore the oil ceiling has been increased by approximately 900,000 b/d. On oil production quotas, he said that OPEC carefully exercises its responsibility towards quota and price commitments.
Al-Naimi said that nominees from the Kingdom of Saudi Arabia, Venezuela and Iran are competing for the post of Secretary General of the Organization, and that elections will be held in September 2003.
For his part, Spencer expressed appreciation of the efforts exerted by the Kingdom to make up for the oil shortage resulting from strikes by oil workers in Venezuela and the war in Iraq. Spencer expressed his wish for enhanced cooperation with the Kingdom in all spheres, and that he will have the opportunity to visit the Kingdom again in the future.
In response to a question on the initiative presented by Crown Prince Abdullah bin Abdul Aziz, Deputy Premier and Commander of the National Guard, to establish a Secretariat General for the International Energy Forum based in Riyadh, Spencer said: “It would be a positive development that we encourage.” He said that the United States has provided support for the post of the Secretary General, making it possible for member states to cooperate to establish the position.
In response to a question regarding U.S. intentions as regards Iraqi oil, he said that U.S. president George W. Bush has stressed that Iraqi oil belongs to the Iraqi people. He noted that the coalition forces were able to protect Iraq’s oil wells, and that the United States is currently reconstructing infrastructure in order that oil production reaches its pre-war levels.
Spencer said that he had planed to visit the Kingdom earlier than the present date, but his visit was postponed due to the repercussions of the events of 11 September, 2001, in New York.
He said that the United States could control only its domestic oil policy, and not that of OPEC countries. He told reporters that the U.S. strategic oil reserve was designed for use in emergencies, and not for managing oil prices.
He confirmed U.S. confidence in the Kingdom of Saudi Arabia for its role in promoting oil market stability. “The Kingdom has proved to be a reliable partner, which has been able to achieve oil market stability during oil crises,” Spencer said, citing the examples of the Venezuela strikes and the war in Iraq.
Source: SPA
