Saudi needs no permission to ensure less volatility in oil market: Minister

Prince Abdulaziz bin Salman, Minister of Energy

Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman said that commodities such as oil are as important as currencies and should be managed. 

The Kingdom does not need anyone's permission to ensure a less volatile oil market that supports the growth and prosperity of the world economy, he added. 

During a panel discussion at the seventh edition of the Future Investment Initiative (FII), he explained that Saudi Arabia has a record not only of the energy transition but is also keen to be a role model as a country whose economy has been based on hydrocarbons for several years. 

The minister emphasized the need to address the energy security, affordability, and economic sustainability challenges, including the implications related to climate change. 

Drawing attention to the substantial value of the oil trade, estimated at $2 trillion compared to the $300 billion worth of all other commodity trades combined, he underscored the vital role of effective oil market management. Questioning the rationale behind increasing production capacity to 13 million barrels in the absence of demand, he advocated the strategic maintenance of a substantial portion of the output as reserves, emphasizing the importance of prudent investment. 

The minister further stated that the value of the oil trade is estimated at $2 trillion compared to the combined commodity trade estimated at $300 billion, which means approximately a ratio of one-to-seven. Accordingly, this means that oil is at the forefront and others trailing, he said.  

He pondered the reason for increasing production capacity to 13 million barrels if it’s known that there is no demand for it.   

Furthermore, Prince Abdulaziz expressed commitment to ensuring the success of COP28, highlighting collaborative efforts with the UAE toward this end.