Oil industry watchers say this is a signal to consumer nations that there is no need to release emergency oil reserves.
“Saudi Arabia is concerned about rising oil prices in the international oil market. The current high price of oil is simply not supported by market fundamentals.
“Saudi Arabia will, as always, take all necessary steps to ensure the market is well supplied and to help moderate prices – and we will meet any additional demand from our customers,” Ali Naimi, the minister said.
The statement is coming four days after US government officials met energy analysts.
The meeting was read by some as a sign that President Barack Obama is considering tapping US government oil supplies in a bid to bring down fuel prices in the run up to the US presidential elections in November.
The International Energy Agency, which co-ordinates oil stocks in the West, has been cool on the idea.
The last stock release which followed OPEC’s acrimonious June 2011 meeting angered officials of the producers’ group, who viewed it as meddling in the market and destabilising for prices.
Brent crude oil prices have surged about 20%since Opec last met in June, hovering around $112 to $117 a barrel since mid-August. Lower supplies from Iran because of sanctions and outages in the North Sea have outweighed slowing global economic growth.
“The market is well-balanced, forward cover remains within an acceptable range and inventories are more than adequate,” Naimi said.
“We will continue to work in collaboration with other Gulf Cooperation Council nations, and with OPEC to defend the stability of the oil market.”
Although Naimi did not explicitly blame oil market speculators for the surge in oil prices since June, Persian Gulf oil price doves have in the past blamed financial market speculation when oil prices have spiralled despite increases in supply.
Trading data showed on Friday that money held by hedge funds and other big speculators in commodities has hit a one-year high, with markets rallying in anticipation of US and European economic stimulus efforts.
But Washington may still look to its Strategic Petroleum Reserve, SPR, for relief from stubbornly high oil prices.
“If Saudi Arabia wanted to stop an SPR release, it would have to do more than make a statement like this,” oil analyst Olivier Jakob at Swiss consultancy Petromatrix told Reuters, adding that talk of releasing oil from the world’s largest reserves was piling pressure on Riyadh to do more to dampen prices.
“Saudi Arabia has made a commitment to the G20 to keep oil prices under control. It has always said it will meet the need of customers,” Jakob said.
“But if you want to bring prices down, you need to do more than that. You need to push more oil into the market.”
Persian Gulf Opec producers have increased their production this year to help make up for lower exports from Iran due to tightening Western sanctions over Tehran’s disputed nuclear programme.
Although Saudi crude supply to the market remained steady at 9.8 million barrels per day in July and August, off multi-decade highs of over 10 million earlier in the year, the big three Gulf Opec producers collectively increased supply by around 400,000 bpd thanks to a 600,000 bpd jump in Kuwaiti production to 3 million bpd.
Saudi Arabia and the United Arab Emirates both cut their production by around 100,000 bpd from July to August, but Saudi Arabia kept supplies to the market unchanged from July by topping that up with crude from in its own vast stocks.
“Naimi could actually be right. Latest data suggest global market will be oversupplied for the second half of 2012,” Tamas Varga, an analyst at brokers PVM Oil Associates in London, said. “Maybe that’s why the kingdom cut production by 100,000 bpd in August.”