Saudi Arabian Prince Alwaleed bin Talal has said that oil prices may never return to $100 a barrel.
In an interview with USA Today, asked if prices would continue to fall, he said: “If supply stays where it is, and demand remains weak, you better believe it is gonna (sic) go down more.
“But if some supply is taken off the market, and there’s some growth in demand, prices may go up. But I’m sure we’re never going to see $100 anymore.
“I said a year ago, the price of oil above $100 is artificial. It’s not correct.”
In a detailed interview he also labelled accusations that Saudi authorities are keeping prices low to put pressure on Russia as “baloney and rubbish”.
“I’m telling you, there’s no way Saudis will do this. Because Saudi Arabia is hurting as much as Russia, period,” he said.
“Now, we don’t show it because of our big reserves. But I’ll tell you Saudi Arabia and Russia are in bed together here. And both are being hurt simultaneously. And there’s no political conspiracy whatsoever against Russia. Because we are shooting ourselves in the foot if we do that.”
The Prince also waded into the debate about Saudi Arabia’s stance to maintain output, despite rapidly falling prices.
“The decision to not reduce production was prudent, smart and shrewd,” he said.
“Because had Saudi Arabia cut its production by 1 or 2 million barrels, that one or two million would have been produced by others.
“Which means Saudi Arabia would have had two negatives, less oil produced, and lower prices.”
On the effects of the fall in prices, Bin Talal said that the crash would see some a spike in mergers and acquisitions in the energy market.
“No doubt about that [there will be mergers]. For sure there’ll be a lot of consolidation in the market. Because many small and medium-sized companies can’t afford this.
“Because they are very much dependent on the price of oil. Big companies like Exxon and Chevron are weathering the oil market crash because they are integrated vertically.
“But no doubt there’ll be some mergers and acquisitions coming in one to two years.”
