Market factors determine global oil prices: Saudi oil min.
Saudi Arabia's oil minister has noted that global market factors must determine oil prices, indirectly ruling out that the kingdom would take any measures to increase the oil price.
"Prices are a function of supply and demand," Ali al-Naimi was quoted by AFP as telling reporters on the sidelines of a mining conference in Saudi Arabia’s capital city of Riyadh on Tuesday.
Emphasizing that it is up to the market factors to determine oil prices, the Saudi minister effectively dashed hopes about Riyadh mulling any market intervention to prop global oil prices.
Al-Naimi, however, made no further comment on oil prices, which have fallen by more than half compared to early last year to hit below USD 50 a barrel.
Saudi Arabia, which is the largest producer of crude oil within the Organization of the Petroleum Exporting Countries (OPEC) and the only member country with significant additional production capacity, has traditionally acted as a factor to stabilize the international market by adjusting its crude output.
However, since last year, the organization, which is facing increasing competition worldwide, has chosen to maintain its production levels unaltered with analysts arguing that it is making a bid to push out new players in the oil market, in particular US shale producers.
In October, the Organization of the Petroleum Exporting Countries released its latest monthly report saying that pressure on the global oil market seemed to be easing.
"Fundamental factors (including oil supply and demand) that have weighed on the market for more than a year have persisted, but are starting to show signs of alleviation," the report said.
OPEC also slightly adjusted upwards its 2015 forecast for crude demand, while at the same time reducing its forecast for production by non-OPEC members.
Global oil prices have plunged from highs of above USD 100 a barrel early last year to half that figure as a result of slackening demand in the global economy, record production by OPEC and a strong US dollar.
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