Saudi Arabia To Keep Oil Prices Stable
By Arab News
The governor of the Saudi Arabian Monetary Agency (SAMA) said on Friday that the Kingdom would offer excess oil production capacity if needed to balance oil prices, and that he expected prices to stay stable.
Brent crude held above $111 on Friday, partly supported by the prospect of fresh sanctions being imposed on Iranian crude early next week. “If there is pressure on demand, Saudi Arabia will always offer excess capacity to bring balance to supply and demand and to balance prices throughout,” Fahad Al-Mubarak said.
The SAMA chief was speaking to a news conference at the inaugural meeting of the Financial Stability Board’s regional consultative group for the Middle East and North Africa.
Al-Mubarak reiterated that the balance sheets of Saudi commercial banks were very strong and that they had only very limited exposure to Europe. Saudi Arabia will continue to ensure its banks are well regulated, he added.
“Saudi banks are complying with Basel II, as a matter of fact they are already complying in most of the bank ratios of liquidity and capital adequacy of Basel III. The system of banks in Saudi Arabia was a very strong one well before I became governor.”
He added: “My role is to continue prudent macro measures to make sure the banks continue to be well-regulated and follow all required rules as well as serving their purpose in the economy.”
Al-Mubarak, formerly chairman of Morgan Stanley Saudi Arabia, was appointed governor of the SAMA last month, succeeding Muhammad Al-Jasser, who had held the post for nearly three years.
Al-Mubarak also said he was not aware of any discussions on the idea of Saudi Arabia contributing more resources to the IMF.
Asked about this, Al-Mubarak said: “Saudi Arabia is a member of the IMF and the programs continue to be discussed, but I don’t know if there is any specific discussion related to the European fund. I am not aware of any discussion at this stage.”
