Saudis pledge to maintain oil supply
In a sign the Kingdom was committed to its stated role of ensuring stability in the oil market, it said it would keep a spare capacity cushion of up to 2 million barrels a day.
Ali al-Naimi, the Saudi oil minister, told a news conference in Riyadh: "Saudi Arabia's production of crude oil today is 9 million and will continue at 9 million until other decisions are made. One of our biggest concerns is to reduce volatility in the market."
Prices have dropped by about 18 per cent since they hit an all-time high of $55 a barrel last autumn. Yesterday, prices fell to nearly $45 after Mr al-Naimi's comments.
The prices were also depressed by strong hints from Sheikh Ahmad al- Fahd al-Sabah, the president of Opec, the producers' cartel, that it will not announce a threatened cut in production in advance of its next meeting.
Last month Opec decided to keep its quotas unchanged but left the door open for an unscheduled cut. Sheikh al-Sabah, who is also Kuwait's oil minister, said there was no need for any talks before its March meeting.
"Until today there is no need for any contacts," he said. "Until today the prices are normal and, on the contrary, the market has reacted very positively with Opec's latest decisions."
Mr al-Naimi declined to comment on whether the Opec cartel might take action in the run-up to its March meeting. "These questions are hypothetical," he said. "We don't know what is going to happen to the price between now and 16 March."
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