Riyadh denied undermine shale oil production

US, WASHINGTON (ORDO NEWS) — Saudi Arabia’s desire to put an end to shale oil producers is false, Riyadh has sought to reduce oil production and achieve market balance, said the king’s Foreign Minister, Prince Faisal bin Farhan Al Saud.

“The Minister of Foreign Affairs declares that the message attributed to Russian President Vladimir Putin of one of the media, where one of the reasons for the decline in oil prices is the kingdom’s withdrawal from the OPEC + agreement and the kingdom’s desire to get rid of shale oil producers, is untrue,” in a ministerial statement posted on Twitter.

“His Highness confirmed that the kingdom’s position regarding shale oil production is known, it is an important source of energy, the kingdom sought to reduce oil production and achieve a market balance, which is in the interests of shale oil producers contrary to the statement made by Russia and its desire to keep prices low to influence the production of shale oil,” the minister added.

According to him, “Saudi Arabia is counting on the right decisions of Russia at an urgent meeting, which the kingdom called for with the participation of countries participating in the OPEC + transaction and a group of other countries in order to reach a fair agreement that would restore the desired balance in the oil markets, as well as energy markets were no longer in danger.”

The situation in the global oil market

Since early March, oil quotes have fallen almost twice due to a slowdown in market demand amid the coronavirus pandemic , as well as the exhaustion of OPEC + agreements . On March 6, the countries participating in the alliance could not agree on changing the parameters of the transaction, and it was not possible to extend it.

Russia insisted on maintaining the existing conditions, and Saudi Arabia wanted to further reduce development. As a result, from April 1, restrictions on oil production in the countries of the former alliance were lifted.

After the failure of the OPEC negotiations, the media began to write about the start of a producer price war. At the same time, Saudi Arabia officially announced the increase in supplies to 12.3 million barrels per day, which is 300 thousand barrels per day more than its production capacity. Riyadh could achieve this indicator through stockpiles.

A spokesman for the Russian president, Dmitry Peskov, said that Russia and Saudi Arabia did not wage price wars, but there was an unfavorable world situation.


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