Saudi Arabia planning to raise crude capacity, says prince

Saudi Arabia plans to increase production capacity to 15 million barrels a day by 2020 from 12.5 million barrels a day today, a Saudi prince said, leading to speculation over a higher internal target.

The new capacity would allow the kingdom to be able to export as much as 10 million barrels of crude a day, according to prince Turki Al Faisal, 68, a former head of intelligence, in a 25 April speech at Harvard University that was posted on the website of the university on Tuesday.

Saudi Arabia's oil minister Ali al-Naimi had told reporters in March last year, the kingdom had no plans to boost capacity beyond 12.5 million barrels a day, though it retained the ability to do so if needed.

The country first announced its plans to raise daily capacity to 15 million barrels in a speech delivered by al-Naimi in 2008, weeks ahead of Brent crude hitting a record $147 a barrel as OPEC's spare capacity decreased.

Within the Organisation of Petroleum Exporting Countries, the desert kingdom maintained the largest spare capacity, with a production of 9 million barrels a day last month, that left 3.5 million barrels a day unused.

According to Khalid Al-Falih, chief executive officer of Saudi Arabian Oil Co, or Saudi Aramco in November, the state- run company had no plans to increase daily capacity beyond 12.5 million barrels and was focused on developing the Manifa oil field to offset declines at other deposits.

OPEC pumped 30.9 million barrels a day of crude last month, according to a survey of oil companies and industry analysts. The biggest producer, Saudi Arabia, increased daily output by 80,000 barrels to 9.18 million, while Kuwait and the United Arab Emirates also increased production by 80,000 barrels a day each.

Output by Iran, which continues to be under western sanctions on its energy exports because of its nuclear programme, fell by 150,000 to 2.55 million barrels a day, the lowest level since February 1990.