New Saudi oil minister endorses production cuts


UAE Energy and Industry Minister Suhail al-Mazrouei said on Sunday that members of OPEC and non-OPEC producers were "committed" to achieving oil market balance.

In his first public appearance as minister, Prince Abdulaziz signaled no radical change in Saudi oil policy.

In his first comments since taking up the role, the minister on Monday endorsed oil supply cuts, saying in Abu Dhabi that they would benefit all producing nations amid an oversupplied market and sagging prices.

The planned IPO forms the cornerstone of a reform programme envisaged by the kingdom's de facto ruler Crown Prince Mohammed bin Salman to wean the Saudi economy off its reliance on oil.

"However, this has come at the cost of reduction in OPEC's global crude market share from a peak of 35% in 2012 to 30% as of July 2019", he told AFP.

The prince, who is in his late 50s, has also been closely involved in the planning and execution of Saudi Arabia's cuts to energy subsidies as part of economic reforms.

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The new factor is the trade dispute between the world's two biggest economies, whose tit-for-tat tariffs have created fears of a global recession that will undermine demand for oil. He put his diplomatic skills to brokering the kind of fudge that's seen the group through many hard meetings and the next day his boss was able to tell the world the kingdom's oil policy remained on track. This is driving prices higher this week because it indicates that he's willing to be proactive in supporting prices.

"We have always said that Aramco is ready whenever the shareholder makes a decision to list and as you heard from his Royal Highness Prince Abdulaziz yesterday that it is going to be very soon, so we are prepared - that's the bottom line", he said. The Saudi-driven strategy, however, has not been able to push prices up significantly with global trade tensions between China and the US weighing on oil prices.

Speaking at an worldwide energy forum in Abu Dhabi where he was the star of the show just a day after being appointed by his father King Salman, the new minister deflected concerns over the health of the energy sector.

"I belong to the downstairs".

Speaking to Middle East Eye earlier this year, Ali Bakeer, a Turkey-based political analyst, said: "A nuclear Saudi Arabia means nuclear proliferation in the most unstable and volatile region of the world".

Oil extended its advance as US stockpiles were estimated to have dropped and OPEC+ members gathered in the United Arab Emirates ahead of meetings this week. "I think it's very important that we stick to the 123 Agreements. What they look like at the end is going to be a subject of negotiation, but as we move forward with USA technology in particular, we are very much committed to finding an appropriate 123 with Saudi Arabia".