Kingdom's deputy oil minister unfazed by US output which could eat into OPEC's market share
Top oil exporter Saudi Arabia remains unconcerned by a rising tide of US shale output which threatens to eat into OPEC's market share, its deputy oil minister said on Wednesday.
"The world economy over the long term will need every contribution of every source of energy available," Prince Abdulaziz Bin Salman Bin Abdulaziz said. "The kingdom welcomes new resources of energy supplies, as they are needed."
"We need to make sure that the world economy comes out decisively on a growth pattern and if that can be established I think that the world economic growth will be sufficient to handle growth from all sorts - shale oil, shale gas, tight oil and including renewable."
The Organisation of the Petroleum Exporting Countries expects global demand for its crude to fall in the next five years because of increasing supplies outside the 12-member group from the boom in shale energy and other sources, according to its annual World Oil Outlook.
Abdulaziz was repeating the Saudi Arabian view expressed by Oil Minister Ali al-Naimi's last year.
"It's a very stable market, it is well supplied. The future holds that the market will continue to be well supplied," Abdulaziz said.
US shale oil is much more costly to produce than Middle East crude, but a surge in global oil prices over the last four years has made it economic to produce and reduced demand for other crudes.
As long as the world economy continues to grow, there will be enough demand for both major production regions to keep pumping.
The North American shale oil surge, combined with record Saudi crude output, has helped arrest the rise in crude prices over the last year, with Benchmark Brent crude oil trading between $100 and $120 for most of the last 12 months.
Several oil ministers from the Organization of the Petroleum Exporting Countries have said over the last few weeks that they see the market as well supplied and stable and that they do not expect the group to change its output ceiling of 30 million barrels per day (bdp) when they meet in Vienna on Dec. 4.For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.