Saudi Arabia says no additional capacity to increase oil production beyond 13 million bpd

JEDDAH: Saudi Arabia will not have any additional capacity to increase oil production beyond 13 million barrels per day, Crown Prince Mohammed bin Salman said during his address to the US-Arab summit in Jeddah.

“The kingdom has announced an increase in its production capacity level to 13 million barrels per day, after which the kingdom will not have any additional capacity to increase production,” he said.

The kingdom previously said it was aiming at production capacity of 13 million bpd by 2027.

The crown prince also said that unified efforts were required to support the global economy and that unrealistic policies regarding energy sources would only lead to inflation.

"Adopting unrealistic policies to reduce emissions by excluding main sources of energy will lead in coming years to unprecedented inflation and an increase in energy prices and rising unemployment and a worsening of serious social and security problems," he said.

The summit in Jeddah was attended by US President Joe Biden and leaders from the six Gulf Co-operation Council states, as well as Egypt, Jordan and Iraq.

US officials have said Biden would discuss energy security with leaders of Gulf oil producers and hopes to see more action by Opec+ to boost output, but there was unlikely to be any bilateral announcements from the talks.

Washington wants Riyadh to open the oil floodgates to bring down soaring gasoline prices, which threaten Democratic chances in November mid-term elections in the United States. After meeting with Saudi leaders Friday, Biden said he was "doing all I can" to increase the oil supply but added that concrete results would not be seen "for another couple weeks".

Prince Mohammed said Saturday the kingdom would "play its role in this field", reiterating a pledge made in May to ramp up daily oil production capacity by more than one million barrels to exceed 13 million barrels by 2027.

The U.S. could secure a commitment that OPEC+ will boost production in the months ahead, which could send a signal to the market that supplies are coming if necessary.

Saudi Arabia, alongside the United Arab Emirates, holds the bulk of spare capacity within the OPEC+ group, an alliance between the Organization of the Petroleum Exporting Countries and other exporters, notably Russia.

Brent crude prices are trading around $100 a barrel, having fallen from a 14-year high of $139.13 in March as investors weigh the impact on demand of COVID-19 lockdowns in top importer China and recession fears. —News Desk