Saudi output capacity to remain constant Saudi Arabia does not plan to increase its oil production capacity in the next 30 years as new sources of supply, from US shale to resurgent Iraqi output, fill the demand gap, according to Ali Naimi, the country's oil minister. Mr Naimi said Saudi Arabia, the world's largest crude exporter, did not expect demand for its oil to increase significantly before 2040 from current levels. "We don't really see a need to build capacity to beyond what we have today," he said at the Center for Strategic and International Studies in Washington. His comments highlight the sea change under way in global oil production. Only five years ago energy policy makers were expecting Riyadh to boost production capacity substantially over the next decades by investing billions of dollars in new oilfields. But the development of shale oil in the US over the past three years, together with expected increases in output from Iraq, Brazil and the Caspian basin mean that extra Saudi pumping capacity may no longer be required. As the main source of spare production capacity in the global oil market, Riyadh's production plans are closely watched. Last week Prince Turki al-Faisal, a former Saudi intelligence chief, said the country planned to increase capacity to 15m barrels a day by 2020 from current levels of 12.5m b/d. Mr Naimi said the country does have sufficient reserves to produce at 15 mb/d, but under current forecasts, including Riyadh's own, demand for Saudi oil is not expected to top 11.5 mb/d before 2040. On Prince Turki's comments, he said: "We have no plans, nothing like that today, nor do I see it....We will be lucky to [see demand] go past 9 [m b/d] by 2020." Saudi is currently producing at 9.3m barrels a day, down from a thirty year high of just over 10m b/d last summer, according to the International Energy Agency, which has a slightly lower estimate for Saudi capacity of 12m b/d. Mr Naimi welcomed the surge in US shale oil production, but dismissed the notion that this could lead to energy independence for the US. "I welcome these new supplies into the global oil market....[but] I believe this talk of ending reliance [on the Middle East for imports] is a naive and rather simplistic view," he said. Saudi Arabia is taking steps to exploit its own shale reserves, with plans to drill seven wells this year, according to Mr Naimi. Mr Naimi also said that Saudi Arabia was seeking to diversify away from oil, but when asked about plans to develop solar and nuclear energy, he ignored the latter. "I didn't mention nuclear," he said, before adding that he was in favour of solar energy. This likely reflected divisions within the government over whether or not it should be developing nuclear power, said Tom Lippman, an expert on Saudi Arabia at the Middle East Institute: "I think he ignored this because the oil ministry does not favour the nuclear programme and he doesn't want to promote it."