Riyadh: Saudi oil production is reported to have reached an all-time high over the past few weeks in what is seen as the result of a positive response by Riyadh to US calls to pump more and help drive prices lower.
Bloomberg quoted informed sources as saying that the kingdom was already producing as much as 11.2 million barrels per day of crude oil, up around 4 percent from 10.8-10.9 million barrels per day earlier this month.
The surge in Saudi supplies come as price of the global benchmark Brent crude oil fell last week to a one-year low of $58.41 a barrel, down from a four-year high of $86.74 in early October. In Monday’s trading, Brent stood at $60.71.
US President Donald Trump has repeatedly used Twitter to ask Saudi Arabia and other OPEC members to boost production.
In January, Saudi production was below 10 million barrels. More recently Trump has compared lower oil prices to a tax cut and a tool to keep inflation low, giving the US Federal Reserve the opportunity to stop raising interest rates.
Iran had earlier criticized Riyadh for increasing its production of oil with the country’s Petroleum Minister Bijan Zanganeh warning that the Saudis were acting in violation of an OPEC agreement reached in June not to raise production.
Zanganeh in a letter to his Saudi counterpart Khalid al-Falih had expressed regret that the kingdom had submitted to US pressure over its oil production policy.
The Iranian minister had in another development criticized US President Trump for using what he described as “hooliganism” to bring down oil prices.
He had rejected Trump’s pressure for an increased OPEC production as “not practical,” arguing that producers were already pumping beyond their capacities.
“Trump thinks he can bring down oil prices with hooliganism,” Zanganeh was quoted by Iran’s local media as saying at an oil and energy conference in Tehran.
“None of the producers is capable of producing more,” he added, stressing that Saudi Arabia was using its strategic reserves suggesting that the kingdom’s rise in production would not be sustained.
The recent surge in Saudi supply comes two weeks before the kingdom and its allies in the Organization of the Petroleum Exporting Countries (OPEC) meet in Vienna to set policy for 2019, Bloomberg added.
Negotiations have already started and will likely intensify later this week at the G20 summit in Buenos Aires, where the leaders of Saudi Arabia and Russia and their oil ministers are scheduled to meet. The two nations are the world’s biggest crude exporters.