Oil Prices Fall on Saudi Deputy Crown Prince Mohammed bin Salman’s Comments

Oil prices have plunged after Saudi Arabia said it would freeze production only if other major producers did the same.

Saudi Deputy Crown Prince Mohammed bin Salman’s remarks are seen as a challenge to Iran.

It has vowed to increase oil production following the lifting of Western sanctions.

In the Bloomberg interview, Prince Mohammed bin Salman also spoke about his plan for a giant public investment fund.

Worth more than $2 trillion, it would be designed to reduce Saudi Arabia’s reliance on income from oil.

Part of the plan would be a sale of shares in the state-owned oil company Aramco, which could start as soon as next year, according to the interview.

Iran will not take part in a conference in Doha on April 17, where the freezing of oil output is due to be discussed.

“If all countries agree to freeze production, we will be among them,” Prince Mohammed bin Salman told Bloomberg.

When asked whether Iran needed to be among those countries he said “without doubt”.

Oil prices, which had edged into positive territory, fell after Prince Mohammed’s comments.

Brent crude fell $1.63 cents, or 4%, to $38.70 a barrel. Prices rose 6% in the first three months of this year – the first quarterly increase since a 15% rally between April and June 2015.

A monthly survey by Reuters this week showed that oil output from the 13 OPEC members rose in March on higher production from Iran and near-record exports from southern Iraq.

Iraq reported OPEC’s biggest supply growth last year, producing more than 4 million barrels per day – making it the cartel’s second-largest producer after Saudi Arabia.

In February, Saudi Arabia and Russia said they would freeze oil output at January levels if other producers followed suit.

Oil prices have fallen from their recent peak of $116 in June 2014 because of oversupply and sluggish demand.