Oil ministers in Saudi Arabia and the United Arab Emirates (UAE) on Monday rebuffed concerns from the International Monetary Fund that the global slump in oil prices will have a "deteriorating" effect on Middle East countries' current account balances.
The price of crude oil has slumped from a high of $114 a barrel last June to currently trade just below the $50-mark but oil ministers in the Middle East, where many major oil producers are located, appear sanguine about the decline.
On Monday, Saudi's vice oil minister said long-term oil market fundamentals remain robust but prolonged low prices could threaten security of supply and pave the way for a price spike.
Prince Abdulaziz bin Salman said "for a major reserve holder, oil producer and exporter such as Saudi Arabia, our focus has always been on the long-term trends shaping the oil market," in a speech at an Asian energy conference in the Qatari capital Doha, reported by Reuters.
"Rather than being a commodity in decline, as some would like to portray, supply and demand patterns indicate that the long-term fundamentals of the oil complex remain robust," he added.
Separately, the UAE's energy minister said that global oil prices would start an upward correction in 2016 as the markets began to rebalance, Reuters reported.
The oil ministers' comments come after Christine Lagarde, the managing director of the International Monetary Fund (IMF), warned Gulf countries that they need to improve their public finances amid the slump in the oil price.
Concluding a meeting in Qatar this weekend with finance ministers and central bank governors from the Gulf Cooperation Council (GCC) –made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE– all of whom major oil exporters, Lagarde said the meeting was designed to look at "challenges facing the global economy and the GCC region, and the policy responses needed."
"At the moment, a large share of fiscal and export revenues in the GCC come from oil. With oil prices having declined sharply since mid-2014, export revenues are expected to be nearly $275 billion lower in 2015 than in 2014," Lagarde warned.
The fiscal and current account balances in the region were "deteriorating sharply", she added, with the fiscal balance projected by the IMF to be in a deficit of 12.7 percent of gross domestic product in 2015. Growth is also expected to slow, with IMF projections suggesting 3.2 percent growth in the GCC in 2015 and 2.7 percent in 2016, compared to 3.5 percent in 2014.
Rather than cutting production to support oil prices, major producers and exporters in the Middle East who belong to the Organization of Petroleum-Exporting Countries (OPEC) have maintained (and often exceeded) their 30 million barrel a day production ceiling.
The move has been widely seen as a way for OPEC, which is led by Saudi Arabia, to maintain its market share and drive out competition from shale oil producers in the U.S., who have higher production costs.
The strategy appears to be working with many shale oil outfits in the U.S. and Canada cutting production and cancelling drilling projects. The move has had domestic repercussions as well, however, with Middle Eastern nations that rely on oil revenues seeing fiscal deficits for the first time in years.
OPEC next meets on December 4 and speculation has mounted that it could cut production as the oil price slump starts to bite at home.
However, UAE Energy minister Suhail Al Mazrouei said Monday that his country, as part of the OPEC producing nations, could not afford losing market share by cutting back on supply, suggesting continued support for the OPEC strategy despite the damage it is doing to government finances.
- By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt.