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Saudis to boost oil production, U.N. says

RIYADH, Saudi Arabia — Saudi Arabia plans to increase its oil production by 200,000 barrels a day next month, the kingdom's oil minister told U.N. chief Ban Ki-moon on Sunday, according to Ban's spokesman.

The U.N. secretary-general met with Oil Minister Ali al-Naimi in the port city of Jiddah during a one-day trip to the world's largest oil producer.

The U.N. chief said al-Naimi told him Saudi Arabia would increase oil production by 200,000 barrels a day from June to July, Farhan Haq, a spokesman who is traveling with Ban, said in an e-mail. In May, the kingdom increased its production by 300,000.

By July, production should be at 9.7-million barrels a day, Haq said.

Ban also said Saudi Arabia understands that the current price of oil, which topped $139 per barrel this month, is not normal, according to the official Saudi Press Agency.

"The king believes that the current oil prices are abnormally high, and he is ready to restore prices to their appropriate levels," the Saudi Press Agency quoted Ban as saying.

Saudi Arabia is concerned that sustained high oil prices will eventually slacken the world's appetite for oil, affecting the kingdom in the long run.

The kingdom has called for a meeting of oil-producing and oil-consuming countries Sunday in Jiddah to discuss ways of dealing with soaring energy prices.

The current president of the Organization of Petroleum Exporting Countries, Chakib Khelil, has said the cartel will make no new decision on production levels until its Sept. 9 meeting in Vienna. OPEC ministers often follow the lead of the Saudis when discussing whether to increase production to take the pressure off rising prices.

The 200,000-barrel-a-day boost is not insignificant — it will raise Saudi Arabia's daily production by about 2 percent. But to a market that has been sending oil prices soaring to record heights due in part to strong global demand, the move might be seen as marginal.

The oil market largely ignored Saudi Arabia's 300,000-barrel-a-day output increase last month.

Saudis to boost oil production, U.N. says 06/15/08 [Last modified: Monday, November 1, 2010 11:56am]
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