Saudi says oil price slump should not stop investment

“The market isn’t putting much store in the comment by Saudi oil minister Ali al-Naimi that Saudi Arabia is working with other producers to stabilise oil prices, viewing the comment as more of a longer-term “motherhood” statement than a commitment to immediate action”, Tim Evans, energy analyst at Citi Futures, said.

He added that the topic of the global oil market will also be touched upon in the framework of the Forum of Gas Exporting Countries (GECF) and during his visit to Iran on November 21-23.

“All investment planned in the UAE is on track and we haven’t seen a change in any plans”, said Neyadi.

“The oil market is once again in significant turmoil”, he said. Crude demand is expected to rise by one million barrels a day every year in this decade, and the world requires more investments in oil to compensate for decline rates, he said.

Al-Naimi, while thanking Mirza and Dr. Abid ibn Abdullah Al-Saadoun, chairman the Arab Petroleum Investments Corporation (APICORP), said: “With its huge discovered and undiscovered reserves, the Arab world is a major player in global oil production and consumption”. The result has been market oversupply, and sharply falling prices.

Naimi said even Arab states that were net importers of oil and gas were being negatively affected by low oil prices.

“As you know, energy sources, most notably oil and gas, are among the fundamentals of modern global economy”. Shell shares rose 1.6%. “We need billions of dollars to continue exploration and producing oil and to invest in spare capacity to stabilise the market”.

Since peaking at over $100 per barrel in July a year ago, oil prices have fallen to around $50 per barrel today.

“Saudi Arabia is a very reliable supplier”. The Saudi minister said that during the last forty years, APICORP actively served the Arab energy sector by funding and equity financing a large number of distinctive energy projects, especially the Arab joint ventures of OAPEC member states, in addition to the provision of financial advisory services and energy research, and the active participation in, and full support of, the energy value chain.

Skinner is also more bullish on the potential for the oilsands production to continue growing in volume, whereas he said shale oil production is poised to start declining.

“I would like to point out the important future role assigned to our countries and companies in the development of the energy sector and the oil industry in the Arab region”.

The seminar was organized by the Arab Petroleum Investments Corporation (Apicorp), an organization established in the 1970 to ensure financing to oil industry projects across the region.