Saudi Energy Minister Prince Abdulaziz bin Salman said Riyadh “hopes to reach an agreement with OPEC+, which includes Russia.”
Speaking to the Financial Times, the minister said “politics should be kept away from OPEC+” (a group of 23 oil-exporting countries), and insisted that “the world should value” the alliance of oil producers.
Oil prices have reached their highest levels in a decade, and “OPEC +” is scheduled to end its quota applied since April 2020, within three months.
Prince Abdulaziz said it was too early to say what a new agreement might look like given the uncertainty in the market, but added that OPEC+ would increase production “if the demand is there.”
“With the chaos you see now, it’s too early to try to define (an agreement),” he said in the interview. “But what we do know is that what we have succeeded in providing is enough for people to say so far that there is merit, and there is value to being and working together.”
OPEC + stuck to the 2020 agreement, under which alliance members raised total production each month by a modest amount of 430,000 barrels per day. But Russia’s production has fallen since the start of the Ukraine war, falling from about 11 million barrels a day in March to an average of 10 million barrels a day in April, according to data provider Oil-X.
Prince Abdulaziz blamed the price hike on lack of global refining capacity and taxes. He said, “The market determinant is the capacity of the refinery, and how to open it… At least during the past three years, the entire world has lost about 4 million barrels of refining capacity, 2.7 million of them since the beginning of Corona.”
He stressed that the “OPEC +” alliance will be necessary to make “orderly adjustments” in the future amid uncertainty over the coronavirus-induced shutdown in China, global growth and supply chains.
“To ease bottlenecks in production and refining capacity, governments should encourage industry to invest in hydrocarbons even as countries shift to cleaner energy sources,” he said.
This situation needs people to sit together, focus, and ignore the sham and the so-called political rationality… It is about trying to relate to the current reality and find solutions to it.”
