MANILA, 23 March 2005 — President Gloria Macapagal Arroyo yesterday exchanged promises with Saudi Minister of Petroleum and Mineral Resources Ali Al-Naimi to make energy more affordable for the average Filipino.
The more substantial promise came from Al-Naimi, who vowed to increase Saudi Arabia’s oil production by 1.5 million barrels a day to ease up on the rising demand for crude oil, which results in higher prices.
“We can increase supply by 1.5 million barrels a day. It depends on demand,” Naimi said, adding: “There is plenty of supply. What we in Saudi Arabia want is to alleviate this unnecessary concern about shortage of supply.”
In response, the president raised the government’s concern over rising oil prices in the world market.
Arroyo said: “We have been sharing with the minister our deep concern about maintaining the price of affordable energy for all Filipinos.”
“Saudi Arabia is doing everything within its power to keep the price of oil down, and I thank him for that,” the president added, referring to the efforts taken by the Saudi Oil Ministry under the leadership of Al-Naimi.
Reports said that as of Monday afternoon, crude oil for April delivery was trading at $56.7 per barrel, just two cents lower than the record high of $56.72 posted on March 18, the highest close since the futures contract was introduced in March 1983.
At a press briefing after the oath-taking ceremony of new Energy Secretary Raphael Lotilla, Al-Naimi explained that it was not an actual shortage in supply in the near-term but the unfounded fears in the market, that have been driving prices up.
“I have said before that we in Saudi Arabia don’t like high prices that negatively impact on economic growth particularly of developing nations.”
“There is a perception in the market that there will be a shortage in supply in the immediate future. I have tried to dispel that notion. I have described our ability to produce 11 million barrels per day,” the Saudi minister added.
He assured that Saudi Arabia has the capacity to produce 11 million barrels per day and will be able to supply 12.5 million barrels per day by 2009, to allay fears of a possible supply shortage in the future.
“There is nothing I can do with people with perception that there’s going to be a shortage in supply. That is the reason the price is on the rise,” he said.
Al-Naimi cited the special relations between the Philippines and Saudi Arabia, noting that both countries have benefited from their close ties, in terms of investments, and employment opportunities among others.
In her speech earlier, Macapagal Arroyo noted that Philippines-Saudi relations cover “oil as well as millions of Filipinos who live and work in the Saudi Kingdom.”
Just last month, a group of Saudi investors led by Abdul Rahman Al-Jarieshy, chairman of the Saudi Chamber of Commerce and Industry (SCCI), was in the Philippine capital to look into possible investment partnerships with Filipino businessmen.
SCCI Secretary-General Dr. Fahd Al-Sultan, member of the 35-member delegation invited by the Philippine Chamber of Commerce and Industry (PCCI) said this would not be the last trade delegation.
Eventually, they hoped to even out the balance of trade between Saudi Arabia and the Philippines.
The country imports most of its oil from Saudi Arabia while the Kingdom is the number one destination of Overseas Filipino Workers (OFWs).
Figures from the Philippine Overseas Employment Administration (POEA) said the 2004 deployment to Saudi Arabia approximates one tenth of total OFWs sent abroad.
At the moment, there are close to a million OFWs in the Kingdom and there are 7.6 million Filipinos abroad.
