Saudi Arabia's Energy Minister Prince Abdulaziz bin Salman told CNBC that an agreement to further trim global oil supply wasn't intentionally timed to coincide with the initial public offering (IPO) of state-owned energy company Saudi Aramco.
On Thursday, Aramco priced its IPO at 32 riyals per share ($8.53), putting it on track to raise $25.6 billion in what would be the largest IPO ever conducted.
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.
Following the announcement, Abdulaziz told CNBC's Hadley Gamble that the two events weren't 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 Saudi Aramco's value couldn't 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 organizations were keen to back the firm for the long term.
A small portion of Saudi Aramco will start trading on the local stock exchange on Wednesday, December 11. He 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."
The prince said he believes those who choose not to take part in the listing will soon be "chewing their thumb" with regret.
Oil prices moved around 2% 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 curb to 2.1 million barrels per day.
The agreement was provisionally put in place Thursday but needed the acceptance of non-OPEC members, particularly that of oil-producing giant, Russia.
At around 3 p.m. in London, Brent futures were $1.14 cents, or 1.8% higher, at $64.53. West Texas Intermediate oil futures rose 97 cents, or 1.66%, to $59.40 a barrel.
OPEC+ had already reduced 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 began in January 2017.
The energy alliance was prompted to act after global oil prices tumbled in mid-2014 due to an oversupply, but U.S. shale producers are not a part of the deal and shale oil supply has grown exponentially.
The U.S. is now the world's largest oil producer hitting 12.3 million b/d in 2019, according to the U.S. Energy Information Administration, up from 11 million b/d in 2018.
— CNBC's Holly Ellyatt and Sam Meredith contributed to this report.