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Page added on May 10, 2016
Saudi Arabia: We’ll pump more oil… and prices will rise
Saudi Arabia thinks the world needs more oil, not less.
Saudi Aramco, the kingdom’s state-owned oil company, will continue to increase production to meet rising demand, its chief executive said Tuesday. And he expects prices to start rising by early 2017.
“Supply and demand will come into balance by the end of the year, or first quarter next year,” Aramco CEO Amin Nasser told reporters. “Prices will trend higher when that happens.”
Oil prices dropped to their lowest level in over a decade earlier this year as producers pumped more oil than the world needed.
But they have stabilized around $45 a barrel despite Saudi Arabia’s move to block a planned production freeze by OPEC and other producers.
The International Energy Agency predicts global demand for oil will rise in the second half of this year and slightly surpass current levels of supply, which stand around 96 million barrels per day.
Aramco pumps more than 10 million barrels of oil per day. Nasser made clear that number will rise if there are buyers for the barrels.
“Our strategy is to meet the [demand] on Saudi Aramco,” Nasser told a group of reporters at his company headquarters. “If it means we need to increase our output, we will do it.”
Saudi Arabia recently announced its intention to make a small portion of Aramco available to global investors. It is mulling an initial public offering in New York, London and Hong Kong, alongside a smaller listing on the Saudi stock exchange.
Deputy crown prince Mohammed bin Salman estimates the company is worth more than $2 trillion.
Related: Saudi Arabia’s looming financial disaster
Saudi Arabia is the unofficial leader of OPEC, a group of some of the biggest oil exporting nations in the world. It has pressured other members to keep production levels high, which has squeezed producers in places like the U.S. that tend to have higher production costs.
Analysts say Saudi Arabia’s goal is to maintain its global market share.
Saudi Arabia ousted its long-serving oil minister Ali al-Naimi over the weekend and replaced him with Khalid al-Falih, the chairman of Aramco.
But the change isn’t completely radical. The new minister is well known in the world of oil and was CEO of Aramco for six years between 2009 and 2015.
5 Comments on "Saudi Arabia: We’ll pump more oil… and prices will rise"
makati1 on Tue, 10th May 2016 5:46 pm
Saudi Arabia is struggling to survive. Or should I say the Saud family is struggling to keep control of the country named after them.
CNN is just another outlet for the US MSM Iron Curtain Department of Propaganda, but we all know that, don’t we?
Truth Has A Liberal Bias on Tue, 10th May 2016 7:19 pm
Saudi Arabia has a couple years left and then it hits a wall……. hard lol. I can’t wait. 30 million people with no prospect whatsoever soon to be on foot headed for Europe. The Hatfield and McCoy types from KSA will make the Syrians look like valuable workers with reasonable attitudes.
http://www.independent.co.uk/news/business/news/oil-price-crash-saudi-arabia-zach-schreiber-a7022426.html
Newfie on Wed, 11th May 2016 12:18 am
I thought they were pumping flat out already ???
GregT on Wed, 11th May 2016 12:45 am
What a load of crap. The bottom line for any enterprise is not market share, it is profit. The Saudis could reduce their market share by less than 20%, make over twice as much profit, and their profits from a non-renewable resource would last longer. More corporately controlled western MSM unadulterated bullshit.
shortonoil on Wed, 11th May 2016 6:55 am
This isn’t the first time in history that those in power have decided to shoot the messenger, rather than hear the message. Ali al-Naimi knows that the age of oil is ending; the royal House of Saudi doesn’t want to hear it! CNN obviously doesn’t know anything, and probably never has. They are going to continue to parrot what they are instructed to say by their Masters in Washington, and be allowed to flood the news waves with the latest item of absolute trivia to appease their readership.
“Supply and demand will come into balance by the end of the year, or first quarter next year,” Aramco CEO Amin Nasser told reporters. “Prices will trend higher when that happens.”
Balance? We say that is impossible, and a world economy that is contracting on every front validates it. Rather than coming into balance the rein of oil is coming to its conclusion. With it will come the conclusion of one of the most dictatorial, oppressive regimes in the world. The Saudi Princes who now have leave to watch the beheadings, will soon find their own on a stake!