Saudi Arabia's OPEC governor Mohammed al-Madi said on Sunday it would be hard for oil to reach $100-$120 per barrel — the peaks it hit last year before falling sharply due to a glut of crude and weakening demand.
Last November, Organization of the Petroleum Exporting Countries kingpin Saudi Arabia persuaded members to keep production unchanged to defend market share and curtail the output of more expensive producers such as the United States. The move accelerated the oil price drop to a low around $45.
"I think it's difficult to reach $100 or $120 another time," Madi told an energy conference in Riyadh.
Oil prices recovered since January to over $60 a barrel, but have fallen again in recent days following a bigger than expected crude stock build in the United States that fueled concerns of an oversupply in the world's largest oil consumer.
Oil companies, including U.S. shale producers, have slashed spending and jobs since the price of oil fell, and may face another round of spending cuts to conserve cash and survive the downturn.
"We are not against anybody or against the (production of U.S. shale oil). On the contrary we welcome it, as it balances the market in the long run," Madi said.
Benchmark Brent crude settled at $55.32 a barrel on Friday.
Madi repeated that Saudi Arabia had no political motives in its oil policy.
"We understand that all countries need higher incomes...We want higher incomes, but we want higher incomes for us and future generations," he said.
"There isn't any political dimension in what we do at the oil ministry - our vision is commercial and economic. We didn't mean to hurt anybody, our vision is simply the following: the producers which have low costs have to have the priority to produce, but those who have high costs have to wait for their turn to produce," he said.
Saudi Oil Minister Ali al-Naimi has made it clear Riyadh will not cut output to prop up oil prices and denied politics played a role in the kingdom's oil policy.
Some producers such as Iran, a political regional rival of Saudi Arabia, have criticized Riyadh for its stance.
"It is in OPEC's interest to achieve balance in the market. The price is decided by the market, and the market is subject to supply and demand," Madi said.
He also said market studies showed that global oil investment of around $40 trillion was needed to meet expected growth in demand, which would be led by emerging markets.
"If you want a stable market 10 years from now, then you have to invest now," he said.
Demand for crude oil is expected to grow by around 1 million barrels a day every year for the next 15 years, Nasser al-Dossary, Saudi Arabia's national representative at OPEC told the same energy conference on Sunday citing market reports.
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