Dec. 4 (UPI) — Saudi Arabia is working to make sure the global oil market is stable, the country’s crown prince said during talks with his U.S. counterpart.
Saudi Crown Prince Mohammed bin Salman met in Riyadh during the weekend with U.S. Energy Secretary Rick Perry to discuss the current market situation, a few short days after members of the Organization of Petroleum Exporting Countries agreed to extend a measure designed to drain the surplus of oil in global inventories.
“The crown prince affirmed the kingdom’s keenness to stabilize energy markets and supply them in a sustainable manner to serve the interests of energy producers and consumers,” a statement from the Saudi Center for International Communication read.
Last year’s weakness followed a market phase characterized by emerging shale oil and OPEC defending a global position through robust production policies. Perry’s office had no public statement on the meeting. U.S. crude oil production continues to set records as markets improve over last year’s slump.
After a decision to extend the OPEC deal to the end of 2018, Joe McMonigle, a senior energy analyst at Hedgeye Risk Management who attended the meetings in Vienna, said the decision could “be a win for U.S. shale producers.”
While OPEC is cutting production through managed declines, the floor under crude oil prices boosted investor confidence in the U.S. shale oil sector, which has proven more resilient to lower crude oil prices than expected. The price for Brent crude oil was around $63 per barrel early Monday, well within the range where shale oil drillers can expect to increase activity.
Speaking in October, OPEC Secretary General Mohammad Sanusi Barkindo said it was the responsibility of all producers, conventional and unconventional alike, to contribute to the balancing effort.
“We urge our friends in the shale basins of North America to take this shared responsibility with all the seriousness it deserves,” he said.
The Saudi crown prince said during the weekend the strategic partnership with the United States extended into various fields, “including energy.”
Parties to the OPEC agreement, which includes contributions from non-member states like Russia, sidelined about 1.8 million barrels per day from global production, about 2 percent of total global demand.
The U.S. Energy Information Administration said September crude oil production was 9.48 million barrels per day, a 3.2 percent increase from August and a 10.8 percent increase year-over-year.