Al-Naimi addresses London Energy Ministers Meeting 3 London

In Jeddah, my view was that fundamental alone cannot account for the
high, volatile prices experienced then and that prices were being
fueled by non-fundamental factors, such as the flow fo speculative
investments into commodities.

Today we meet in London at the opposite end of the price spectrum;
the price of oil has plummeted by more than $100 to under $50 per
barrel in just a few months. Lower prices are a testament to
worsening economic and financial conditions experienced of late. To
illustrate, global oil consumption for this year, which was projected
to increase by 2 million b/d/ with anemic growth anticipated next
year. However, I continue to believe that non-fundamental factors
continue to impact oil prices, both upwards and downwards. To
illustrate, consider the rapid and substantial financial deleveraging
which has resulted in sharp price declines not just for oil and
commodities, but for nearly all financial instruments.
The instability and volatility in oil markets hurt everyone, from
producers to investors to consumers. For producers, today's price
levels are wreaking havoc on the industry and are threatening current
and planned investments, atop impaired funding markets which have
reduced credit availability and raised funding costs. Not
surprisingly, a number of upstream and downstream projects have
already been cancelled or delayed. For consumers and investors, a
high degree of volatility dents confidence and sends mixed signals
about the future. And finally, emerging economies reliant on exports
and external financing will be hurt by low prices.
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