Saudi Arabia is poised to pump more oil if the global energy crisis worsens

Saudi Arabia’s energy minister has said he is ready to pump more oil if the global energy crisis worsens, describing the OPEC+ cartel’s decision this month to cut oil supplies during a period of high prices as a “mature” decision.

Prince Abdulaziz bin Salman said that from next month, production of less oil caused rift with the USwas needed to provide a larger buffer of spare capacity should sanctions on Russian exports or any other unforeseen event lead to a significant drop in global supply.

“You have to make sure you create a situation where things [get] worse you have the ability [respond]Prince Abdulaziz, who also heads the group of oil producers, said Future Investment Initiative investor conference in Riyadh. “Running out of capacity costs a lot more than people realize.”

He added: “We will be suppliers to those who want us to supply.”

OPEC+ production cuts announced this month pushed oil prices up similarly, much of the world has struggled with skyrocketing energy costs and rising inflation. The decision of the member countries, including Russia, caused a strong reaction from the White House, which accused the cartel of helping to support Russia’s war in Ukraine.

Prince Abdulaziz used the on-stage interview to present Saudi Arabia, the world’s largest oil exporter, as a responsible supplier of energy to the world. He criticized the US for withdrawing millions of barrels of oil its strategic oil reservesthe largest in the world to prevent faster price increases.

“We, as Saudi Arabia, have decided to be more mature,” he said. “People are depleting their emergency reserves. . .[using]it is like a mechanism for manipulating markets, when its deep purpose is to alleviate the supply shortage.”

According to the International Energy Agency, at the end of August, oil reserves in OECD countries were 243 million barrels below the five-year average. US SSP inventories are at their lowest level since 1984.

Relying on emergency reserves for oil supplies “could become painful in the coming months,” Prince Abdulaziz added.

Riyadh has said the output cuts are needed now to restore its spare capacity and avoid the possibility of a more dangerous spike in oil prices later. Critics say the kingdom’s goal was to prop up its own revenues by keeping oil above $90 a barrel — nearly double its long-term historical price.

Brentthe international benchmark for oil, traded around $93 a barrel on Tuesday.

The oil dispute has pushed relations between the US and Saudi Arabia to a historic low and fueled anxiety in European capitals over high energy prices. But Prince Abdulaziz insisted Saudi Arabia was ready to send more oil to Europe if EU sanctions on Russian oil, which come into full force on December 5, lead to a shortfall that needs to be filled.

Exports to Europe had already risen to 950,000 bpd in September from 190,000 bpd a year earlier, he said, adding that Saudi Arabia was in talks with “many” European governments, including Germany, Poland, the Czech Republic, Croatia and Romania. , on increasing the offer.