Saudi Arabia says it’s taking investment away from foreign rivals
Saudi Arabia, the world's biggest producer of oil, claims to be taking investment away from US shale producers and other foreign competitors, according to the FT.
A Saudi official told them there was “no doubt about it”, that the decline in price over recent months had “deterred investors away from expensive oil including US shale, deep offshore and heavy oils”.
And the statistics suggest it could be true – the International Energy Agency has released figures showing how US shale oil production stalled in April.
The official went on to say that the kingdom would remain the dominant force in global energy, even as more alternatives become available: “Saudi Arabia wants to extend the age of oil. We want oil to continue to be used as a major producer of that energy”.
The country, which leads Opec, made the controversial decision last year to keep its oil production at current levels, despite a higher rate of production from its rivals. It was hoped that Saudi Arabia would cut production to help keep oil prices up.
Needless to say, this allowed a steep decline in prices to continue. And nothing seems to knock their confidence – in April this year, Saudi Arabia ended up producing the largest amount of oil yet at an average of 10.3m barrels a day. It's looking unlikely that there'll be any change at next month's Opec meeting in Vienna.