Saudi Arabia’s energy minister has rejected Russia’s allegation that the kingdom withdrew last month from a deal to cut oil production.
Prince Abdulaziz bin Salman was quoted early April 4 by Saudi state news agency SPA responding to comments made the day before by his Russian counterpart.
Saudi Foreign Minister Prince Faisal bin Farhan Al Saud also commented on the ongoing dispute with Russia, saying that a statement attributed to Russia’s President Vladimir Putin about the kingdom’s withdrawal from the OPEC+ deal is not correct, and that Russia is the one that withdrew, SPA reported.
Russia and Saudi Arabia have been at odds since failing last month to agree on a deal to curb output as the coronavirus pandemic spread around the globe. The pandemic has worsened since, freezing economic activity worldwide and sending oil prices into a steep decline.
The world’s oil producing countries in the Organization of the Petroleum Exporting Countries (OPEC) and allies such as Russia have been discussing a deal to cut production in hopes of reversing the crash.
Prices have dropped to about 34 dollars a barrel, down from about 65 dollars a barrel at the end of 2019.
A deal to cut production, however, would require participation from countries outside the OPEC+ group and from ones that do not exert state control over output, including the United States.
He said he did not make any concessions to Saudi Arabia and Russia such as agreeing to a U.S. domestic production cut, a move that would violate U.S. antitrust laws.
He said both countries are being “hurt unbelievably badly” by the crash in the price of oil, but he added, “I think they are going to settle their dispute very quickly.”
He also said the dispute is hurting the rest of the world, and “Ultimately the market is going to get them to stop.”
A meeting of OPEC+ has been scheduled for April 6. The alliance includes OPEC members, Russia and other producers, but excludes oil nations such as the United States, Canada, Norway, and Brazil.
The head of the International Energy Agency told Reuters that a deep cut in production would not be enough to prevent a huge build up of global crude inventories in the second quarter.
Fatih Birol said a production cut of as much as 10 million barrels per day that might be discussed at the April 6 meeting would still result in a 15 million barrel daily build in the second quarter.