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Page added on May 13, 2012
Saudi says $100 per barrel great price for oil
Top crude exporter Saudi Arabia wants an oil price of around $100 a barrel and would like to see global inventories rise before demand picks up in the second half of the year, Oil Minister Ali al-Naimi said on Sunday.
International Brent crude settled at $112.26 on Friday, well off a peak of over $128 in March. Brent has mostly traded above $100 since early 2011, keeping fuel costs high and threatening to damage a fragile global economy.
“We want a price around $100, that’s what we want,” Naimi told reporters ahead of an industry event in Australia. “A $100 price is great.”
Saudi Arabia is working at bringing Brent crude prices to that level, he added. The kingdom, OPEC’s biggest producer, said it pumped 10.1 million bpd in April, its highest for more than 30 years, as it bid to meet growing demand and curb oil prices.
Prices have stayed high in 2012 due to concern about disruption to global supply from U.S. and European sanctions aimed at hurting Iran’s crude export revenues and forcing Tehran to halt its nuclear program. The U.S. and its allies suspect Iran is developing nuclear weapons, which Tehran denies.
Naimi said last week that producers were pumping enough to deal with the impact of the sanctions on the oil market. [ID:nL4E8G96HJ] He reiterated on Sunday that producers were pumping 1.3 million barrels per day (bpd) to 1.5 million bpd above demand, which is helping to build inventory.
“That should give comfort to consumers,” he said.
Inventories are at the equivalent of around 58 days of demand, but Saudi Arabia would like to see stockpiles build more ready for the seasonal increase in fuel consumption in the second half of the year, Naimi said.
“It should be a little bit higher, because you are going into the third and fourth quarter, and demand will be higher as usual,” he said.
The International Energy Agency said on Friday that oil prices were likely to stay high, despite a dramatic improvement in world supply and a big build in stocks, due to the tensions between Iran and the West.
4 Comments on "Saudi says $100 per barrel great price for oil"
MrEnergyCzar on Sun, 13th May 2012 2:57 pm
I thought it was $70?
MrEnergyCzar
Johny K. on Sun, 13th May 2012 5:42 pm
Whatever level the oil price becomes, Saudis just say “the current market price is our target price, we want it and we support it”.
The same thing happened with $70 oil, now it is $100, then it will be $150, then $200, and each time Saudis just say “that’s the fair price right now”.
DC on Sun, 13th May 2012 7:50 pm
Exactly the ‘right’ price for oil is whatever the market will bear, or happens to be sitting at for any length of time.
Supply is hardly a response to ‘demand’ when the ‘markets’ are so heavily distorted and manipulated like ours are. And no, im not talking about SA here. Throw another 100 million gas-burners on the roads and the price will go up, regardless of what SA ‘wants’ or thinks is ‘fair’. Who is thowing out all this artifical demand. Well, we are, not SA. China is helping too of late, but if the US had its way and was able to manipualte the world like it used to, then a FF energy bubble would exist in the US and the oil would going there instead of China. In the end, it doesnt matter who is plugging the demand, only that someone, somewhere is.
BillT on Mon, 14th May 2012 12:21 am
Considering that our Empirical military uses $180,000,000,000.00 plus worth of the stuff every year, you can see what another 10% increase does to the national debt…lol. You pay at more places than the gas pump.