Saudi Arabia Challenges Algiers Oil Agreement

While oil prices have stabilized at the threshold of $80 a barrel in world markets in recent weeks, Saudi Arabia decided to raise its share of oil, hoping to buy Trump’s conscience to stand by its side in the crisis that sparked by the assassination of the Saudi journalist Jamal Khashoggi in his country’s consulate in the Turkish capital Istanbul three weeks ago.

Saudi Energy Minister, Khalid al-Faleh, said in an interview with TASS news agency that his country would soon increase production to 11 million barrels per day from 10.7 million currently.

He also promised that his country would increase production to 12 million barrels per day and its ally the UAE at 0.2 million barrels per day, in an attempt to compensate the Iranian oil when the US embargo was launched against in from next November 6.

The Saudi offer came on the eve of Turkish President Recep Tayyip Erdoğan’s investigation into the Khashoggi assassination, amid Riyadh’s fears the opposite of what it wished for will be discovered, especially after Erdogan promised to reveal all the facts, regardless of their results, which means that the offer is directed to the United States, which warned that prices will remain above the threshold of eighty dollars.

US President Donald Trump criticized oil prices at $ 74 a barrel saying it is too high, in an implicit invitation to its Gulf Arab allies, Riyadh and Abu Dhabi, to raise production and dump the market so prices could fall again.

It is known that the reference price of a barrel of oil, set in the Finance Act of 2018, is $ 75 per barrel, which means that the current prices, created an outlet for the national economy, which was affected greatly after the collapse of prices of black gold in world markets for almost four years.

Khalid Al-Falih said: “We have sanctions on Iran, and no one knows how Iranian exports will be. Second, there are potential declines in countries such as Libya, Nigeria, Mexico and Venezuela. If three million barrels per day will disappear, we can not cover this volume, so we have to use oil reserves”.

“I can not give you a guarantee, because I can not predict what will happen to other suppliers”, he responded Donald Trump without naming him when asked if the world could avoid a return to $ 100 a barrel.

The Saudi oil minister’s statement was a stab to the oil-exporting OPEC, which had met in Algeria last month and decided to maintain its current production and not to flood the market with excess supply to keep prices, but Saudi Arabia and the UAE decided otherwise.