JEDDAH: Saudi Arabia has reiterated its resolve to stabilize the world oil market in cooperation with oil producing and consuming nations.
“What we endeavor for is to stabilize oil prices,” Deputy Minister of Petroleum and Mineral Resources Prince Abdulaziz bin Salman told a crowded press conference at the Jeddah Hilton last night.
Officials from around the world, including British Prime Minister Gordon Brown, US Energy Secretary Samuel Bodman and Indian Finance Minister P. Chidambaram, along with the chief executives of major oil companies, are meeting today to discuss the issue of oil prices and the role of speculators.
Custodian of the Two Holy Mosques King Abdullah called the meeting on short notice and the organizing committee headed by Prince Abdulaziz finalized the arrangements for incoming high-level overseas ministerial and other delegations.
He characterized the oil price issue as complicated.
“This is a multifaceted and multidimensional problem and we need a collective will to address the issue,” the minister added.
The minister referred at length to a background paper that has been prepared for today’s oil summit. “A lot of leg work has already been done by three most important institutions — OPEC, the International Energy Agency and the International Energy Fund. This paper was prepared on Monday and circulated to all parties concerned on Tuesday.”
He refused to divulge the details of the paper saying: “It charts out a road map to bring stability to the oil market.”
In response to a question about the blame game that is currently under way between the oil producers and consumers, he said: “This meeting is proof of the fact that we are saying enough is enough.”
He admitted that there were expectations from the meeting, but cautioned that one has to be realistic.
“If the oil prices do not come down the day after tomorrow, it doesn’t mean that this conference has failed. We are looking at the complete picture and trying to come up with long-term solutions. We are trying to draw a collective approach to address the issue.”
Prince Abdulaziz said the world should not question Saudi Arabia’s motives, but rather look at its actions.
The response to the meeting is phenomenal and out of the 38 countries invited we have participation from 36 countries, in addition to seven international organizations. “There is no company big or small dealing in oil that is not represented here.
“We owe it to the world, we owe it to the hungry people of the world and we owe it to the most deprived people of the planet.
It is our wish that in this interdependent world everybody should play his or her part,” he added.
The working paper calls for improving transparency and regulation of financial market by monitoring index fund activity.
Asked whether there would be announcement of further oil output increase by Saudi Arabia or other OPEC members, the minister said: “Whether others are willing to do it or not is not for my department to answer, but the Kingdom will do everything that it takes to calm the market in close consultations with other members.”
The Kingdom has serious initiatives, he said, but those are not focused on prices alone. “We are more focused on the long-term, optimal revenue for Saudi Arabia,” he said.
Asserting that there are no easy solutions to the oil price issue, Prince Abdulaziz said the working paper under discussion today would be “diverse and tough”.
Asked what Saudi Arabia considers as the right price of oil, the minister said: “We prefer oil prices to be stable. We focus on long-term optimal oil revenues. We want to prolong the life of our petroleum resources.”
— K.S. Ramkumar, Siraj Wahab and Samir Al-Saadi contributed to the report
