LONDON/DUBAI – World oil prices slid Tuesday as most members in OPEC, including Saudi Arabia, believe that the ideal price for oil is around $100/barrel and would like to see current oil prices fall further given a weak global economy, a senior Gulf official said Tuesday. Brent North Sea crude for delivery in November dropped 34 cents to $113.45 a barrel in late afternoon London trading. New York's main contract, West Texas Intermediate (WTI) or light sweet crude for October, pulled back 31 cents to $96.31 a barrel. “We think the oil market is balanced. There is no shortage,” the source told reporters on the sidelines of an energy conference in Dubai. “The expectation is that for the next few months and next year even, there is more non-OPEC oil coming.” At the same time, demand was expected to weaken given the current state of the global economy, he added. Demand growth “will not exceed 800,000 b/d,” the source said. “We believe that the price is high and not supported by fundamentals...we would like to see the price going down and Saudi Arabia is working to bring it down,” the senior Gulf source said. Saudi Arabia is producing “around 10 million b/d and is expected to continue to produce 10 million b/d” if there is demand from its customers, he added. “Oil at $100 seems the ideal price for the majority in OPEC,” he said. “The majority of OPEC countries prefer $100/barrel, including Saudi Arabia.” The source also said that markets were balanced and commercial oil stocks were “comfortable,” with supply set to rise in coming months from the US, Iraq and other non-OPEC oil producers. Saudi Arabia sees no need to change its oil production level at this time with prices at current levels and will continue to supply its customers with their needs, the source said. “Absolutely not,” the source said when asked whether Saudi Arabia would cut supply as oil prices have declined. “Saudi Arabia wants to see oil prices fall even further,” the source said, adding that Riyadh was concerned about the impact of high oil prices on the global economy. He was responding to Monday's dramatic fall in oil futures prices to their lowest levels in four months. The remarks by the senior Gulf source follow a statement by Saudi Arabian Oil Minister Ali Al Naimi pledging Saudi efforts to defend oil market stability. Naimi said in the Sept. 10 statement that oil prices were not supported by fundamentals and that inventories were more than adequate to meet demand, remarks interpreted at the time as directed toward Washington and talk of a possible release of oil stocks from the Strategic Petroleum Reserve. “Saudi Arabia will, as always, take all necessary steps to ensure the market is well supplied and to help moderate prices and we will meet any additional demand from our customers,” Naimi said in his statement. “We will continue to work in collaboration with other Gulf Cooperation Council nations, and with OPEC to defend the stability of the oil market.” Saudi Arabia has total production capacity of 12.5 million b/d and at current production levels, can bring on an additional 2.5 million b/d if needed. – Agencies
