WASHINGTON, 3 May 2006 — Record crude oil prices above $70 per barrel are not in the interest of the world’s largest producer or its largest consumer, Minister of Petroleum and Mineral Resources Ali Al-Naimi said yesterday.
“Prices at these levels are not in the interest of either Saudi Arabia or the US,” Naimi said in prepared remarks at a joint appearance with US Energy Secretary Sam Bodman at the Center for Strategic and International Studies.
Naimi said that cutting reliance on foreign imports will not boost energy security as US President George W. Bush has asserted.
“A popular misconception these days is that a country can decouple its domestic oil prices from international prices by lowering imports,” Naimi said.
Bush raised hackles among Kingdom officials in January when he said he wanted the United States to slash oil imports from the Middle East by 75 percent by developing alternative fuel sources such as ethanol made from farm crop waste.
He also wants Congress to open Alaska’s Arctic National Wildlife Refuge to oil drilling, which he says could boost US oil supplies by 1 million barrels a day and reduce some oil imports.
“The reality is that oil import levels are not a good measure of economic security or vulnerability to price increases,” Naimi said, though he did not refer specifically to Bush’s policies.
“Countries backsliding into protectionism believe that they are better off by withdrawing,” Naimi said. But world oil markets are increasingly dependent on inter-global trade and ignoring that fact is “a retreat from the gains afforded by globalization,” he said.
Meanwhile, the price of Brent North Sea crude oil struck a record $74.97 per barrel yesterday.
Brent crude leapt by $1.08 to reach the new record at around 1710 GMT. The price of London’s Brent North Sea crude for June delivery later stood at $74.73 per barrel. The contract has struck recent historic peaks on fears of military conflict between the United States and Iran. In yesterday’s pit trading, New York’s main contract, light sweet crude for delivery in June, surged by $1.00 to $74.70 per barrel.
