Brent plunged to $28.94 a barrel on Friday, its lowest in 12 years, on the prospect of additional Iranian barrels
Saudi oil minister Ali al-Naimi said on Sunday it would take "some time" to restore stability to the global oil market in the midst of a glut but he remained optimistic about the future.
Naimi's comments come at a time when OPEC member Iran is preparing to raise oil exports after international sanctions were lifted on Saturday. Brent LCOc1 plunged to $28.94 a barrel on Friday, its lowest in 12 years, on the prospect of additional Iranian barrels.
"As you know, the oil market has witnessed over its long history, periods of instability, severe price fluctuations, and petro-economic cycles," Naimi said in a speech at an energy event in Riyadh attended by the Mexican president and energy minister.
"This is one of them. Market forces, as well as the cooperation among the producing nations, always lead to the restoration of stability. This, however, takes some time," he said.
"I am optimistic about the future, the return of stability to the global oil markets, the improvement of prices and the cooperation among the major producing countries," he added.
Naimi made a reference to the Asian financial crisis of 1998-1999 when oil crashed and Riyadh helped organise a production cut with other non-OPEC producers, including Mexico, to support prices.
Meanwhile, Iran is ready to increase its crude oil exports by 500,000 barrels a day, its deputy oil minister said on Sunday.
Such comments could put Iran on a collision course with Saudi Arabia and other Gulf members, who have been resisting cutting production to shore up prices.
For the past 18 months, oversupply has been the main factor responsible for dragging down prices by two-thirds, after Saudi Arabia led OPEC in a shift of its policy in November 2014 by deciding against cutting production to support prices.
Naimi said that Saudi Arabia and Mexico were to sign on Sunday "a petroleum cooperation agreement between the two countries, covering several areas including the exchange of experts, establishment of joint ventures and encouragement of mutual investments."
Naimi declined to make any further comments to reporters after the event.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.