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‘Aramco will cut costs, not delay projects’ |
KUALA LUMPUR: Saudi Arabia’s state-owned oil giant will be looking to cut costs rather than delay or abandon oil projects amid the fall in global oil prices, a senior company executive has said.
“Construction is one area where we can reduce costs – steel prices are down 60%, for example,” Abdulla A Al-Naim, vice president for Petroleum Engineering and Development at Saudi Arabian Oil Co, told Dow Jones Newswires.
The company, also known as Saudi Aramco, is the world’s largest oil company by output.
“The only way to invest is (for the) long term; we think oil prices will recover within a year – some people are even saying five to six months,” he said.
Al-Naim, who spoke on the sidelines of the International Petroleum Technology Conference, made the remarks amid an unprecedented oil price slide that has forced several international and national oil companies to announce project delays or cancellations.
Industry analysts have warned that any underinvestment – in either upstream or downstream sectors – may cause oil prices to soar when the global economy, and thus demand for energy, recovers.
There has been speculation recently that Saudi Aramco has withdrawn investment in oil and gas projects, but Al-Naim confirmed this isn’t the case. – Dow Jones Newswires |
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