According to the OPEC and industry sources, the world's biggest crude exporter, Saudi Arabia has said that it wants the oil prices to remain in the price range of $70 and $80 a barrel currently. The main aim of Saudi Arabia is to keep a check on the oil prices until the U.S congressional elections and at the same time increase their revenue to finance their economic development projects.
After rolling out Saudi Aramco, a national petroleum and natural gas company, the Kingdom of Saudi Arabia started the process of pushing the oil prices for increasing valuation of the company and launching an Initial Public Offering (IPO), which is scheduled to take place this year.
However, when the U.S President Donald Trump came into the power in April, then he started to put pressure on the Kingdom to control the oil prices ahead of the congressional elections, which is about to take place in the month of November.
"The Saudis need oil at about $80 and they don't want prices to go below $70. They want to manage the market like this," one of the sources told Reuters. "They need cash. They have plans and reforms and now the IPO is delayed. But they don't want anyone else talking about oil prices now. It's all because of Trump," the source said.
To keep price of the oil $70 and $80 a barrel, Saudi Arabia may consistently modify its output according to the demand and supply that may influence the oil prices.
"Striking a balance between the various objectives, and doing it within a narrow price range, is an extremely difficult task given the wide uncertainties and the different shocks hitting the oil market," the United Kingdom Oxford Institute for Energy Studies, said.