Saudi Minister of Energy, Prince Abdulaziz bin Salman, justified the increase in oil export prices to Saudi Arabian Oil Co. (Saudi Aramco) expecting a significant surge in crude demand amid improving market conditions.
The Kingdom’s government acts as regulator for the energy sector, while Aramco is independent in terms of commercial operations and contracts, the minister told Algerian TV.
He noted that the energy ministry determines the output and Aramco sets the pricing formula for the markets and customers.
Earlier this week, Aramco raised the price of Arabian light crude to Asia by about $6.1 per barrel, the steepest increase in at least two decades, a move that falls within the framework of Saudi Arabia's strategy to support the oil market after the OPEC + agreed to extend output cut.
On the recent OPEC + agreement, Prince Salman said that the exceptional circumstances made everyone aware that the decision taken by OPEC+ need to be followed, adding that some countries, who previously admitted to not abiding to output cuts, are willing to commit to production cuts in coming months.
Elsewhere, the minister said that the energy sector was among the worst-hit sectors due to the coronavirus pandemic, resulting in lower crude demand.
Last week, the OPEC+ group agreed to extend production cuts for an additional month or until July-end.
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