RIYADH: Saudi Arabia will increase its oil production capacity from 2025 to 2027, before going back to the current level of 12.3 million barrels per day in 2028, the Kingdom’s energy minister has revealed.
Speaking at the International Economic Forum in St. Petersburg, Prince Abdulaziz bin Salman said the Organization of the Petroleum Exporting Countries, and its allies, collectively known as OPEC+, has the option to pause or reverse output increase.
“We adjusted the production capacity from 13 million barrels per day to 12 million bpd. However, in 2025, we will have an incremental increase. We will have a bigger incremental increase in 2026 and 2027. And then we will go back to our 12.3 million bpd production in 2028,” said the energy minister.
He added: “To increase the capacity over the years, you need to have a clear path on how you produce these volumes. But that does not mean what people are now saying, that OPEC+ is shifting from being a price fixer to a market share fighter. Methodologies of intimidation do not work with OPEC+.”
Referring to media speculations that surfaced last year about the UAE’s plans to leave OPEC, the Saudi energy minister said that the issue was sorted out in a short meeting in Abu Dhabi.
“People speculated about whether the UAE would be staying or not staying (with OPEC). That issue was sorted out over a lunch in Abu Dhabi. A very nice lunch,” said the minister.
During the discussion, Haitham Al-Ghais, secretary general of the OPEC+, highlighted the importance of focusing on fundamentals.
Al-Ghais also expressed optimism about continued strong oil demand, citing a rebound in travel.
“It is important to remain focused on the fundamentals. This is what really drives our decision. We look at economic growth, We look at supply, we look at demand, and yes, we do still believe demand for oil is good and resilient,” said Al-Ghais.
He added: “Last year, OPEC’s forecast for oil demand was the best. And all those who criticized OPEC’s forecast kept adjusting their number throughout the year.”
The OPEC+ chief added that more investments are needed in the oil industry to stabilize the market and meet the rising demand.
Al-Ghais also made it clear that energy sources of all kinds are necessary for the future and that efforts should be made to reduce emissions.
“By 2030, we have a statistical projection that 600 million people will move to new cities as a part of urbanization. This puts everything into context. We need all sources of energy. We should not discriminate any sources of energy. The focus should be on tackling emissions,” said Al-Ghais.
During the same panel discussion, the Minister of Energy and Infrastructure of the UAE, Suhail Mohamed Al-Mazrouei, said that the country is committed to both the OPEC group and its consumers.
Referring to a collective of countries he dubbed “the great eight” - Saudi Arabia, the UAE, and Russia, as well as Algeria, Kazakhstan, Kuwait, Oman, and Iraq - he said the group had been “sacrificing these additional voluntary cuts to stabilize the market.”
Al-Mazrouei added: “UAE has been committed to this group, committed to the consumers and the market.”
He added: “The UAE and Saudi Arabia and other major economies in the region are playing a critical role in linking the east with the west and the south with the north.”
Alexander Novak, deputy prime minister of Russia, said that the world energy sector is sensitive to fluctuations but has the capacity to balance itself.
“Our goal is to ensure sufficient supply for internal markets safely and securely and ensure that energy resources can be supplied in sufficient quantity to domestic markets,” said Novak.
He added that Russia continued to reduce oil production in May under its agreement with OPEC+ partners.
