Saudi Arabia's oil minister has claimed the recent drop in oil prices is temporary and predicted an increase in the future.
Ali al-Naimi explained that commodity price fluctuations were set to continue but he was hopeful that there would be a stabilisation in the future. Saudi Arabia is the biggest production nation in the Organization of Petroleum Exporting Countries (Opec) and was one of the members opposed to a potential reduction in output.
The oil producing cartel met in November to discuss methods to halt the decline of oil prices, which have halved since the turn of the year. A reduction in output had been highlighted as a potential method to tackle the slide but faced opposition from a number of members, including non-Opec member Russia.
A decision was made to maintain the current output levels and Mr al-Naimi is now hopeful prices will improve in the coming months. On Thursday (December 18th), the price of Brent crude had fallen below $63 (£40) a barrel while US crude had edged down to $58 a barrel. It is a stark contrast from the summer months when prices were well above $100 a barrel.
Mr al-Naimi explained that it was "difficult, or even impossible, for Saudi Arabia or Opec to undertake any measure that would lead to a reduction in [their] share of the market and an increase in of others".
Russia has been hit hard by the falling oil prices. The country relies heavily on revenues from oil exports and suffered from the drop in Brent and US crude. Russia's central bank recently took the decision to increase interest rates from 10.5 per cent to 17 per cent to help combat the sliding rouble which has lost considerable value against the US dollar.
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