Gulf kingdom’s foreign minister says market forces, supply and demand will determine oil issue.
Saudi Arabia is “not prepared” to cut oil production, its foreign minister said on Thursday, after the top exporter agreed with Russia to freeze output if major rivals follow.
“If other producers want to limit or agree to a freeze in terms of additional production that may have an impact on the market but Saudi Arabia is not prepared to cut production,” said Adel al-Jubeir. “The oil issue will be determined by supply and demand and by market forces. The kingdom of Saudi Arabia will protect its market share and we have said so,” he said in an interview.
Saudi Arabia and other OPEC producers have refused to reduce output in an attempt to drive less competitive players, in particular U.S. shale oil producers, out of the market. But in the first sign of OPEC and non-cartel producers cooperating after prices fell around 70 percent since mid-2014, Saudi Arabia and Russia said Tuesday they would freeze output if other major producers do the same.
Venezuela, Qatar and Kuwait also agreed on the planned freeze following talks in Doha. Saudi Arabia’s regional rival Iran surprised markets by saying that it too supported the move, sending prices soaring.
Although Tehran has not committed to any output curbs, its comments were seen as significant as it returns to world markets following the lifting of international sanctions.