Saudi Energy Minister Prince Abdulaziz bin Salman told CNBC on Friday that an agreement to further cut global oil supply was not intentionally timed to coincide with the initial public offering (IPO) of state-owned energy company Saudi Aramco. On Thursday, Aramco has priced its IPO at 32 riyals per share ($8.53), putting it on track to raise $25.6 billion in what it is likely to be the largest IPO ever made. On Friday, OPEC and its allies — a wider grouping termed OPEC+ — agreed to cut an extra 500,000 barrels per day (bpd) of their oil production during the first three months of 2020. After the company's announcement, Abdulaziz told CNBC's Hadley Gamble that the two events were not linked. "The fact that they coincided, people try to draw a correlation between the two. Some media outlets tried to use that as a way to explain what we are trying to do at this meeting," he said. Abdulaziz said Aramco's value could not be evaluated by "a tweak here or a tweak there" in the oil supply. He said that the list of institutional investors for Aramco signaled that organisations were keen to support the firm for the long term. A small portion of Saudi Aramco will commence trading on the local stock exchange on Wednesday, December 11. The minister described the decision to list locally as the "brightest day of his life," as the benefit of the listing would go, first and foremost, to "our people" and to others who "believe in Saudi Arabia." He said he believes those who choose not to participate in the listing will soon be "chewing their thumb" with regret. OPEC moves oil price Oil prices inched around 2 percent higher on Friday, after OPEC and other producing countries agreed the new production limit that will hold back around 1.7 million barrels per day. Saudi Arabia has said it will extend its voluntary restriction of 400,000 barrels to take the aggregate global production cut to 2.1 million barrels per day. The agreement was provisionally put in place on Thursday but needed the acceptance of non-OPEC members, in particular that of oil-producing giant, Russia. OPEC+ had already cut output by 1.2 million b/d since the beginning of the year. The current deal, which runs through to March 2020, replaced a previous round of production cuts that commenced in January 2017. The energy alliance was prompted to act after global oil prices fell in mid-2014 due to an oversupply, but U.S. shale producers are not a part of the deal and shale oil supply has risen exponentially. The U.S. is now the world's largest oil producer reaching 12.3 million b/d in 2019, according to the U.S. Energy Information Administration, up from 11 million b/d in 2018. Source: CNBC
