Saudis say cautious approach to restoring OPEC+ output paid off

Saudi Arabia’s cautious approach to reviving OPEC+ oil output has been proved correct, said Energy Minister Prince Abdulaziz bin Salman.

After a year of oil market turmoil due to the coronavirus pandemic, fuel consumption is seeing robust growth and the International Energy Agency is calling for the cartel to boost supplies. Yet, in the minister’s view “we still are not out of the woods.”

“Many claim that I’m excessively cautious,” Prince Abdulaziz told the Robin Hood Investors Conference on Wednesday, according to people familiar with his comments. “Well, it is paying off.”

Crude futures are trading at a two-year high above $70 a barrel, bolstering the coffers of the Organization of Petroleum Exporting Countries and its allies, of which Saudi Arabia is a leading member.

The group is still withholding as much as 5.8 million barrels a day of production from the market. Prince Abdulaziz has previously said that he wants to see clear evidence of a strong demand recovery before restoring more of that idle capacity.

Wednesday’s comments indicate that he’s sticking to that position, even as crude prices continue to rally and a nuclear deal that could restore millions of barrels a day of Iranian oil exports looks more remote.