Saudi Aramco expects oil prices to rise by end of 2016

This would be the worst growth rate for Saudi Arabia since 2009, when the economy contracted by 2.1 per cent because of the sharp fall in crude prices due to the global financial crisis.

The plunge of oil prices since June 2014 has pushed Saudi Arabia’s fiscal position into deficit and spurred the government to examine new ways of expanding its revenue base and diversifying its economy. Saudi Arabia announced a possibility to reduce extraction, if all OPEC countries, as well as such non-aligned oil producers like Russian Federation take part in the program.

He also said OPEC and non-OPEC producers needed to work together to tackle oversupply in order to prop up oil prices.

Egypt has enjoyed the support of Saudi Arabia, as well as of Gulf neighbours Kuwait and the United Arab Emirates, since the military ouster of then-President Mohammed Morsi in July 2013 following mass protests against his rule.

But still Riyadh has given no indication of wavering. If prices freeze at Dollars 30 per barrel in 2016, a lot of them will become bankrupt.

The YASREF refinery has the capacity to refine 400,000 barrels per day of Arabian heavy crude and produces over 13.5 million gallons per day of ultra-clean transportation fuels and other high-value refined products. Saudi Arabia holds 267 billion barrels of proven crude reserves, the world’s second-largest after those of Venezuela, according to data from BP.

Saudi Arabia outlined ambitious plans on Monday to move into industries ranging from information technology to healthcare and tourism, as it sought to convince global investors it can cope with an era of cheap oil. Total volume traded was more than double the 100-day average while front-month prices rose 21 percent over two sessions at the close Friday after the February contract expired Wednesday at $26.55 a barrel, the lowest since 2003.

Al-Falih also stated that Saudi Aramaco’s investments in its business has not slowed down, despite oil trading at a multi-year low.

But Falih told reporters on the sidelines of Monday’s Global Competitiveness Forum that his country is not to blame for low prices.

“We would love anyone to say look, if you change this law or regulation, I am coming here with these investments”.

So far, Harami said, the battle is not yet won. “A wide range of decisions have been made to adopt progressive policies and implement procedures aimed at achieving wide structural economic reform“, said Al-Othman.

The kingdom will “defend its interests internally and externally” whether that pleases outsiders or not, the diplomat told AFP, speaking on condition of anonymity.

“Demand will grow as it already started in 2015, and there will be a period not far into the future where demand catches up with supply and inventories are worked out of the system, and we will be back at where we were before”, he said. Capital punishment there is typically carried out by a sword-wielding executioner, who beheads the prisoner.