Adam Smith would not be pleased: High oil prices not justified, according to Saudi Arabia
Saudi Arabia's oil minister Ali al-Naimi said global supply, demand and inventories of crude don't justify the current increase in oil prices, the official Saudi Press Agency reported.
"Saudi Arabia is concerned about rising oil prices in the international oil market," al-Naimi said yesterday.
"The price of oil is simply not supported by market fundamentals. The market is well balanced, forward cover remains within an acceptable range and inventories are more than adequate."
Brent crude, a pricing benchmark for more than half of the world's oil, has risen 29 per cent since this year's lowest close on June 21, as a EU embargo on crude purchases from Iran took full effect on July 1.
Saudi Arabia is producing near the highest level in more than three decades. Its output has boosted supply from the Opec to 1.3 million barrels a day more than the world needs this year, data from the group showed in its most recent monthly report.
The desert kingdom has worked with the GCC, to raise production as US sanctions penalised customers buying Iranian crude.