June 14, 2008

Saudi Arabia Plans to Increase Output

Saudi officials have advised oil traders and analysts they plan to increase output by 500,000 barrels a day next month, The New York Times reported Friday.

Saudi Arabia's current output is 9.45 million barrels a day, up 300,000 barrels from last month. The proposed increase would bring output to 10 million barrels, the highest ever for the world's largest oil exporter.

While King Abdullah snubbed President George W. Bush when the Bush asked for an output increase during two meetings this year, Saudi officials appear to be nervous about the continued rise in oil prices, the Times said. The king has also scheduled a meeting for June 22 in Jeddah for major oil producers and consumers to discuss the reasons for the price increase.

The price of oil dropped Friday by $1.88 a barrel to $134.86.

Ibrahim al-Muhanna, an adviser at the Saudi petroleum ministry, said his country wants to bring back stability to the oil market.