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Wednesday, May 22, 2024

Only renewables can’t fix energy problem: Saudi energy minister

Low investment in energy sector has caused a rise in price.

The Saudi energy minister said on Sunday that focusing only on renewable power sources was a mistake and that the world may not be able to produce all the energy needed for economic recovery from the coronavirus pandemic.

“The pandemic and the recovery underway have taught us the value of caution,” said Prince Abdulaziz bin Salman during an energy event in Riyadh.

He added that a lack of investments had caused energy prices to rise, but that Saudi Arabia was continuing to invest in production capacity.

The minister was speaking at a conference attended also by the UAE and Bahraini energy ministers, the Iraqi and Kuwaiti oil ministers and Egypt’s petroleum minister.

OPEC+ should stick to current output agreement

The OPEC+ alliance was already struggling to meet existing targets, and has been under pressure from top consumers calling for more crude to cap surging prices amid fears over possible supply disruptions resulting from the Russian military presence at Ukraine’s borders.

On Wednesday, the International Energy Agency urged OPEC+ to narrow the gap between its oil production targets and actual output.

U.S. crude prices stand at around $91 a barrel after surging some 40% since Dec. 1 and earlier this week touched their highest level since 2014. Prices for Brent crude, the global benchmark, have also soared and are near 7-year highs.

Read more: Oil prices go 7-year high: Danger for Pakistan

UAE energy minister Suhail al-Mazrouei said OPEC+ is always looking at supply and demand, and blamed geopolitics for soaring oil prices.

“We are all hoping for the de-escalation… I think our plan has been working and I don’t believe that the market is hugely under-supplied currently. It’s the other factors that are outside our hands which are impacting the market,” Mazrouei said.

Iraqi oil minister Ihsan Abdul Jabbar said that “for the benefit of all the energy market, OPEC+ should stay with the continuing and sustained current agreement” to avoid surprises.

Read more: Arab ministers reach China to secure energy contracts

Kuwaiti oil minister Mohammed al-Fares said OPEC+ is very sensitive to market reactions.

OPEC+ said it will work to integrate Iran into its oil output pact should Tehran and world powers reach agreement on reviving their nuclear deal, sources close to the group said on Friday. read more

Reuters with additional input by GVS News Desk