Saudi Arabia is willing to resume its role as global swing producer once crude prices stabilise
OREANDA-NEWS. Saudi Arabia is willing to resume its role as global swing producer once crude prices stabilise at a level Riyadh deems suitable, according to indications given by Saudi Arabia's oil minister Khalid al-Falih.
Saudi Arabia will be expected "to balance supply and demand once market conditions recover," al-Falih was quoted as saying today by state-owned Saudi Aramco.
Al-Falih, who was accompanying Saudi deputy crown prince and defence minister Mohammad bin Salman on a visit to the US, also said "Saudi Arabia is seeking to maintain that balance while also giving heed to moderate prices for producers and consumers," according to Aramco.
Saudi Arabia abandoned its role of global swing producer in November 2014, leading a new Opec strategy of defending market share instead of defending price in the face of rising non-Opec output, particularly US shale oil.
Al-Falih, who is in charge of Saudi Arabia's overall energy, industry and mineral resources portfolio, said Saudi Arabia is targeting the introduction of 9.5 gigawatts of renewable-generated power to its grid by 2030. The National Transformation Programme (NTP) 2020 calls for installing 3.5GW of renewable energy by 2020.
Al-Falih, who also heads Aramco's board of directors, invited US companies to increase their investments in Saudi Arabia, particularly in downstream petrochemicals industries. Saudi Arabia wants to drastically reduce its dependence on oil revenues and expand its industrial base.
"We want to take our investment experiences in basic industries in areas such as oil, refining, petrochemicals, aluminum, and phosphates two more levels," said al-Falih. "The first is the complementary industries to these basic industries, taking advantage of advanced materials produced by the petrochemical industries, along with minerals industries of iron and aluminum manufactured in Saudi Arabia."
Al-Falih said competitively priced electricity, oil and gas, and feedstock would develop the petrochemicals industry, supported by infrastructure seen in the industrial cities of Jubail and Yanbu and planned industrial cities at Ras al-Khair and Jizan.
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