Saudi king says oil should be $75 per barrel
Saudi Arabia’s king says the price of oil should be $75 a barrel, much higher than it is now, but his oil minister indicated Saturday that no measures will likely be taken until OPEC meets again next month. Saudi Oil Minister Ali Naimi said that the Organization of Petroleum Exporting Countries will “do what needs to be done” to shore up falling oil prices when the group meets Dec. 17 in Algeria, but for now it was “too early.”
Other ministers at the hastily convened OPEC meeting in Cairo did not entirely rule out cuts, including Libyan oil official, Shokri Ghanem, who, ahead of the meeting, said “all options are open.” But Naimi, whose country is the world’s largest oil producer, said the bloc needs to wait until the Algeria meeting to assess the impact of earlier production cuts.
Naimi’s comments came after Saudi King Abdullah told the Kuwaiti newspaper Al-Seyassah in an interview published Saturday that oil should be priced at $75 a barrel. “We believe the fair price for oil is $75 a barrel,” he said, without saying how the price could be raised. The price of crude stood at about $147 a barrel in mid-July. On Friday, the U.S. benchmark West Texas Intermediate crude for January delivery was trading at about $54 per barrel.
A Nov. 24 New York-based Oppenheimer & Co. research report says that for oil to rebound to $65 a barrel, OPEC would need to cut crude production by more than 3 million barrels per day from its September levels — a move it called highly unlikely.
