Saudi Oil Minister Ali Al-Naimi and British Prime Minister Gordon Brown are in agreement: Something must be done to stabilize the price of oil. Low oil prices, says Naimi, are seriously affecting the ability of producing states to increase production. If the price isn’t high enough to sustain investment in future energy development, whether traditional or alternative, there’s going to be another demand crisis as the world economies return to normal.

Havoc, says Naimi

LONDON – With no end in sight as oil slid to its lowest level in almost five years, Saudi Oil Minister Ali Al-Naimi, said Friday the current price levels “are wreaking havoc on the industry and are threatening current and planned investments.”

Speaking in London during a meeting of 27 oil producing and consuming nations convened in London and attended by figures including British Prime Minister Gordon Brown and OPEC chief Abdalla Salem El-Badri, Al-Naimi suggested that production levels alone did not drive oil prices.

Prices fell despite pledges by the Organization of the Petroleum Exporting Countries this week to remove 2.2 million barrels per day from its supply, which will be the largest ever reduction by the producer group.

The Kingdom would be pumping less oil in January according to its new output target, Al-Naimi said. Brown in his opening address sought action to reduce huge swings in oil prices that he said had damaged the world economy. “We will need a new partnership between oil-producing and oil-consuming countries,” Brown said.

“As with the global financial crisis, this global crisis in our energy markets cannot be solved by one nation or one continent alone.”
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