Saudi Crown Prince’s key announcements push oil prices to two-year high

Riyadh (OIC-UNA) � The recent statements by Saudi Arabia’s Crown Prince Muhammad bin Salman, deputy premier and minister of defense, have sent oil prices to over $60, the highest in more than two years, agencies said.

The Crown Prince’s statements have cleared the fogginess shrouding the markets, hence restoring confidence. The restoration of a balance in the oil market has raised the status of the Kingdom’s leadership, proving its success despite the challenges. During the recently held investment conference here, the Crown Prince confirmed that the demand for petroleum is set to increase. Crown Prince Muhammad also provided reassurance on the future of energy, both conventional and renewables. In a statement to Reuters, he said the Kingdom was committed to working with all OPEC and non-OPEC countries.

He said that they have achieved a great and historic agreement and the Kingdom would support all that would realize stability of supply and demand. He stressed that they have restored control over all matters. He confirmed the Kingdom’s readiness to extend the deal on cutting oil production, which has restored balance between supply and demand. The Crown Prince added that the high demand for oil has offset the high production of shale oil. Comments made by the Crown Prince have sent Brent crude to its highest in two years ($59.3 a barrel), Reuters said.

Crown Prince Muhammad reassured that the Aramco initial public offering is still on track for its scheduled takeoff in the second half of 2018. Minister of Energy, Industry and Mineral Resources Khalid Al-Falih said earlier this week that AEuros œWhen we get closer to that (five-year average) we will decide how we smoothly exit the current arrangement, maybe go to a different arrangement to keep supply and demand closely balanced so we don’t have a return to higher inventories. These comments suggest that the lower production could become something of a norm as long as everyone in OPEC and its external partners agrees.

THE $500 billion mega-city, called ‘NEOM’ planned by Saudi Arabia will be floated on financial markets alongside oil giant Saudi Aramco as part of the Kingdom’s drive to diversify away from oil, the Crown Prince told Reuters in an interview on Wednesday. The Crown Prince also said Aramco’s initial public offering is on track for next year and the national oil giant could be valued at more than $2 trillion.

The surprise announcement about the listing of NEOM, a 26,500-sq. km zone that will extend into Jordan and Egypt, is the latest and most extraordinary in a slate of privatization programs led by the floating of Aramco. The futuristic high tech hub looks set to become a flagship of reforms championed by Prince Muhammad to create jobs, encourage entrepreneurs and permit new freedoms among Saudis steeped in puritanism and dependence on the state.

The first capitalist city in the world … this is the unique thing that will be revolutionary,� said Prince Muhammad, heir to the throne of the largest Arab economy. The Crown Prince spoke on the sidelines of the Future Investment Initiative conference, which ended on Thursday, has attracted nearly 4,000 delegates from around the world to Riyadh this week.

Source: International Islamic News Agency