Saudi Minister of Energy, Industry and Mineral Resources Khalid al-Falih said on Wednesday that oil markets were at the end of a “considerable downturn” and that fundamentals were improving.
“Market forces are clearly working after a testing period of sub-$30 oil prices… Oil demand is expanding at a healthy rate despite slower global growth,” Al-Falih said.
A graphic shared by Saudi Aramco via Oil and Money conference.
According to CNBC, the Minister added that by freezing production or slightly reducing it, OPEC wanted to signal to the market that it wanted to lower inventories and encourage investment.”I am happy to see more rigs coming back,” he said, adding that unconventional oil production was important for helping to meet global demand growth.
The comments were made at the Oil & Money conference in London at the Intercontinental London Park Lane on Wednesday. The theme of this year’s conference is “Boom, Bust and Beyond: Strategies for Survival,” and “will focus on the challenge of managing the oil price downturn and meeting the new financial, environmental and geopolitical realities facing the global oil and gas business,” the conference says on its official website.
[Follow the Oil and Money conference on Twitter for updates throughout the day.]
The Minister also said that “many nations” are willing to join OPEC in cutting production to secure a continued improvement in oil prices, but did not name those other countries in his speech. According to Bloomberg, only Russia has said it’s considering an output freeze or a reduction, while other non-OPEC producers that cooperated with past supply curbs, including Mexico and Norway, said they won’t cut.
