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OPEC won’t bear burden of propping up oil price: Saudi minister

RIYADH (Reuters) – OPEC will not take sole responsibility for propping up the oil price, Saudi Arabia’s oil minister said on Sunday, signaling the world’s top petroleum exporter is determined to ride out a market slump that has roughly halved prices since last June. Last November, Organization of the Petroleum Exporting Countries kingpin Saudi Arabia persuaded members to keep production unchanged to defend market share. The move accelerated an already sharp oil price drop from peaks last year of more than $100 per barrel that was precipitated by an oversupply of crude and weakening demand. Since the oil price collapse, top OPEC exporter Saudi Arabia has said it wants non-OPEC producers to cooperate with the group. But Saudi oil minister Ali al-Naimi said on Sunday that plan had so far not worked. "Today the situation is hard. We tried, we held meetings and we did not succeed because countries […]

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Saudi looking beyond oil price slump as rig count spikes

DUBAI/KHOBAR, Saudi Arabia (Reuters) – As the global energy industry stares transfixed at a spectacular drop in U.S. rigs, Saudi Arabia is ramping up the number of machines drilling for oil and gas despite a sharp fall in the price of crude. Industry sources and analysts say the OPEC kingpin is looking beyond the halving of global oil prices since June 2014 to a time when crude could again be in short supply. Riyadh is therefore keen to preserve what is known as its spare capacity – the kingdom’s unique ability to raise oil output quickly at any given moment. But to achieve that, Saudi Arabia has to drill much more than in the past, after boosting output to record levels to compensate for global supply outages in the past four years. "The Saudis are probably worried about everyone else reducing capex as a result of low oil prices […]

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Saudi oil: Peak conspiracy

The oil world’s been full of speculation about the shift of strategy last year by Saudi Arabia which saw it keep the pumps running even as the price fell, turning an initial drop into a plunge. There may be a simpler explanation for Saudi’s willingness to see prices slide than an attack on US shale or a “ political plot ” against regional rival Iran, though: a change in the Saudi view on peak oil. The Saudis have two choices with their oil: sell it now, or sell it later. If they think oil is running out, it is reasonable to think prices will keep rising in future – perhaps rising much faster than the returns they could earn by deploying the money elsewhere, particularly since they invest a lot of their excess foreign exchange in US Treasury bonds paying almost nothing. The logical thing to do is to […]

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U.S.: Security risks in oil-rich Saudi region

Riyadh-Makkah (Mecca ) highway in Saudi Arabia U.S. warns of threats to Westerners in oil-rich parts of Saudi Arabia. (UPI/Shutterstock/Fedor Selivanov) U.S. consular services in Saudi Arabia remain closed five days after a threat surfaced against Western oil workers in the country, the U.S. embassy said. The U.S. Embassy in Riyadh said consular services are suspended through Tuesday because of unspecified heightened security concerns at diplomatic outposts in Saudi Arabia. "A new security message will be sent out as soon as consular services return to normal," an embassy statement read. An embassy statement last week was specific to Western oil workers . The embassy said Friday it had information stating that terrorist groups may have plans to target oil workers, "possibly to include those U.S. citizens working for oil companies in the Eastern Province [of Saudi Arabia], for an attack and/or kidnapping." The embassy provided no further information on […]

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Saudi Arabia Wooing Fired U.S. Shale Workers to ‘Join Our Team’

A floor hand signals to the driller to pull the pipe from the mouse hole on Orion Drilling Co.’s Perseus drilling rig near Encinal in Webb County, Texas, U.S. For decades, the Saudis have recruited workers from the U.S. for its conventional drilling programs, offering hefty salaries and benefits as lures. Photographer: Eddie Seal/Bloomberg (Bloomberg) — Workers fired from U.S. shale fields after the collapse in oil prices could soon have a new boss: the nation some blame for driving that decline. The state-owned Saudi Arabian Oil Co., also known as Saudi Aramco, is posting new job ads online aiming to snap up experts in extracting oil from shale as the country seeks to become a leader in that rapidly expanding effort. Tens of thousands of U.S. workers have been fired since November as oil prices plunged because of oversupplies, driven in part by an OPEC decision supported by […]

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Saudi Arabia Needs More Oil to Feed Local Refinery Expansion

(Bloomberg) — Saudi Arabia’s plans to expand local refineries while maintaining its share of the global crude market point to one thing: higher production. The world’s largest oil exporter will probably increase output this year to feed new refineries, deepening a global supply glut, according to analysts at Societe Generale SA and DNB ASA. The kingdom may go as high as 10 million barrels a day by April, according to Torbjoern Kjus, an analyst at DNB in Oslo. That would be the most in more than two years, according to data compiled by Bloomberg. “Saudi Arabia will do the same thing as other OPEC members have always been doing: They’ll produce as much as they can,” Kjus said by phone March 11. Fellow OPEC members, the United Arab Emirates and Kuwait, will probably do the same because “they don’t want to be holding back on any potential exports.” Crude’s […]

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Saudi Oil Adviser Says Strengthening Demand Will Lift Prices

Ibrahim Al Muhanna, advisor to the Saudi Arabia Minister of Petroleum. Photographer: Antoine Antoniol/Bloomberg (Bloomberg) — Global crude consumption is strengthening, and prices will stiffen as demand matches supply, a senior adviser to Saudi Arabia’s oil minister said. Prices have stopped falling at about $60 a barrel as expanding demand helps contain the global glut, Ibrahim Al-Muhanna said at a conference in Doha, Qatar. It’s too early to say if the Organization of Petroleum Exporting Countries, which kept output unchanged in November, will alter policy when it gathers again on June 5, he said. “I am confident that demand is and will be stronger,” said Al-Muhanna, adviser to Saudi Oil Minister Ali Al-Naimi. “Supply will remain healthy, and the price will firm up.” OPEC’s refusal to cut production amid the surge in U.S. shale output fed a surplus that contributed to a drop of almost half in prices last […]

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Saudi Nuclear Deal Raises Stakes for Iran Talks

Saudi Arabia’s King Salman greeted South Korean President Park Geun-hye in Riyadh last week. ENLARGE Photo: Saudi Press Agency/Reuters WASHINGTON—As U.S. and Iranian diplomats inched toward progress on Tehran’s nuclear program last week, Saudi Arabia quietly signed its own nuclear-cooperation agreement with South Korea. That agreement, along with recent comments from Saudi officials and royals, is raising concerns on Capitol Hill and among U.S. allies that a deal with Iran, rather than stanching the spread of nuclear technologies, risks fueling it. Saudi Arabia’s former intelligence chief, Prince Turki al-Faisal, a member of the royal family, has publicly warned in recent months that Riyadh will seek to match the nuclear capabilities Iran is allowed to maintain as part of any final agreement reached with world powers. This could include the ability to enrich uranium and to harvest the weapons-grade plutonium discharged in a nuclear reactor’s spent fuel. Several U.S. and […]

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Sweden cancels military deal after Saudi human rights snub

Margot Wallstroem, Sweden’s Minister for Foreign Affairs Sweden is cancelling a controversial military deal with Saudi Arabia a day after an unusually frank diplomatic bust-up between the two countries over human rights. Government officials in Stockholm said that Sweden would not prolong an arms and training deal that had threatened to tear apart the centre-left coalition in the country. More On this topic IN Europe Swedish business leaders, including dozens of prominent chief executives and chairmen, had publicly lobbied for the deal to be extended, arguing that contracts worth billions of krone with Saudi Arabia could be at risk. But on Monday Saudi Arabia blocked Sweden’s foreign minister Margot Wallström from addressing the Arab League in Cairo. Ms Wallström, who had been invited after Sweden became the first EU country officially to recognise Palestine , said she had been told that Sweden’s discussion of human rights and democracy was […]

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John Kerry Flies to Saudi Arabia to Discuss Iran Nuclear Talks

MONTREUX, Switzlerland — Secretary of State John Kerry flew to Saudi Arabia on Wednesday to take on the challenge of explaining a potential deal over Iran ’s nuclear program to the American-allied conservative monarchies of the gulf. In the Saudi capital, Riyadh, Mr. Kerry plans to meet with King Salman and to consult with foreign ministers from Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates, who are also flying there. Like Israel, which opposes the potential deal, Saudi Arabia and other Arab nations in the region see Iran as an opponent. They are concerned about the terms of the deal, which would be limited in duration and would allow Iran to retain some of its nuclear infrastructure. Mr. Kerry met here in Switzerland for three days of talks that also included the United States energy secretary, Ernest J. Moniz, and Ali Akbar Salehi, the director of Iran’s Atomic […]

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