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Good afternoon, ladies and gentlemen.
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I must say this is a tremendous pleasure, it's an honor also to be here with you.
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And over the last four decades, I had the privilege of speaking at many universities in North America, South America and the Middle east, in Europe and Asia.
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But few can compare with Stanford either in terms of its reputation or its positive and lasting impact on the world.
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And just before I proceed, I have a message from someone in Saudi Arabia to the university here.
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As you know, many of our employees are Stanford graduates, we are very happy with that.
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And one of them asked me to pass this message to you, and he asked that I wish the cardinal the best luck in the big game coming up against Cal.
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>> [APPLAUSE] >> And he said that he is looking forward to a repeat of last year result, so I hope I have delivered the message.
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This is a unique time for me, both as President and CEO of Saudi Aramco and as an individual this year. Mr.
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Achemandi just mentioned that we celebrated our 75th anniversary with the theme of energy for generations.
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And this is a reference not only to the generations of men and women who built our company over the years.
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But also the fact that we will continue to reliably supply energy to the four corners of the world for many generations to come.
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The anniversary provided us with an opportunity to look back on our proud history as well as to our future as an organization.
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And as such, it was a time for both introspection and for purposeful action, I would note that this part of the world holds a special place in our story.
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And my thunder was stolen because actually, the company that signed the 1933 Sun Session Agreement with the Kingdom of Saudi Arabia was Standard Oil of California, predecessor, of course, to De Chevron.
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And as you know, it was based up the road in San Francisco.
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Mike Steinecke stays and becomes in our history in the center, in our exhibit center, at the heart of that center, we have a huge picture of Mike Steinecke, graduate of this university.
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His gear, his books, it's put there, people ask us you are a Saudi company, why do you have in the center of your exhibit is a reference to your American connection?
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And we say we are very proud of our American connection, and this is really what made us what we are, is this connection.
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So it's coming here is like coming home or our ancestral home for many of myself and my friends.
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From a personal perspective, I will be retiring at the end of this year after four full decades of service with Saudi Aramco and nearly 14 years as its president and CEO.
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This is a special moment for me to look back on my career as an oil man and an executive.
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From this vantage point, I can view my accomplishments with a sense of achievement, look at my mistakes and the occasional missed opportunity with a tinge of regret.
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And regards the lessons I have learned with an appreciation for the knowledge and wisdom they imparted.
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Most of all, I can appreciate the friendships that I have formed with so many outstanding individuals in the world of energy and beyond.
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I have been truly blessed in my career and in my management team, and I leave knowing that the company is in a safe, strong pair of hands in the person of my successor. Mr.
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Khalid Al-Falih, currently our executive vice president for operations and an outstanding leader in his own right, even though he's a Texas A&M Aggie by the way.
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I was trying to compose my thoughts for this session on the importance of leaders and leadership in the world of business.
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And the key success factors that set truly outstanding businessmen and women apart from the great and the good.
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And I was struck by a passage in the mission statement of Stanford's Graduate School of Business which says the school will and quote, develop innovative, principled and insightful leaders who change the world end quote.
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To me, those words encompass a universe of possibilities and promise, And so I would like to look at the concepts of innovation, insight and principle and examine how living those values truly can change the world.
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Innovation is near and dear to my heart, in fact, I have made innovation the watchword of my tenure as president of Saudi Aramco.
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Early in the years when I became president, I was asked, what would I want to be known for at the time of my retirement?
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And my answer, maybe it was the second year when I took the job, I said, I want to be known as the one who let the journey out of the bottle.
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And what that meant is encouraging and capturing the ideas and initiatives of our people and then apply them to our work and our operations.
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As you know, we manage roughly a fifth of the planet's proven reserves of crude oil and supply about one in every 10 barrels of oil that the world population consumes every day.
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And so there's a lot on our ability to deliver, there's a lot of riding of our ability to deliver.
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And the brain power of our people constitutes the single, Most important factor in fulfilling that responsibility, and is without a doubt one of our greatest competitive advantages as an organization, thanks to an institution as great as this one.
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Today, our employees are contributing fresh and exciting ideas in many different facets of our business, including the development of of new technology.
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And improved tools, streamlined operational processes, and new revenue streams, and cost saving initiatives.
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Whether these innovations are revolutionary step changes that transform our business, or incremental improvements, and enhancements.
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They are all important in helping us maintain Saudi Aramco's status as the single most reliable supplier of vital energy to Saudi Arabia, and the wider world.
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One prerequisite for such an environment of innovation, and engagement, is developing and sustaining a culture of creativity, and self development.
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In which people at all levels of the business are encouraged to challenge, or change outdated modes of thinking.
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And to manage their own careers, and assume responsibility for their own professional development.
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To a large extent, the tone is set by an organization's leadership team.
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Who must themselves question their own assumptions, be prepared to step out of their own comfort zones, and take calculated, and well informed risks.
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Recognizing, that they are risks all the same, and contain not only the seeds of success, but also the possibility of failure.
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But more important than lofty talk and high level discussions are concrete applications which nurture, and sustain such a culture.
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For example, at Saudi Aramco, we utilize a whole range of self sustaining programs which cultivate the intellect and hone the talents of our people.
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These include an extensive offerings of online learning courses in many different fields, structured individual development plans, and a performance management program for uniform employee evaluation and development.
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Cafe style conferences, which bring employees together to discuss pressing issues, and recognition programs to highlight those men and women throughout the company, who have created and spearheaded innovative programs and initiatives.
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Yet, as the Chinese say, and I just came from China, talk doesn't boil the rice.
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[COUGH] [LAUGH] And even those programs are wasted unless the intellectual energy they unleash can be harnessed, and an innovative idea turned into an innovative application.
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It's like the waters of a rushing stream, or a river, it's only when you build a water wheel to turn a millstone, that you have converted the energy of the current into beneficial effort.
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Perhaps, the most significant step we have taken in that regard is our idea management system.
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Which lets employees electronically submit ideas and suggestions to the responsible organization for evaluation, and where applicable, implementation.
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But if innovation is the motor that keeps an organization moving through both choppy seas and still.
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Then insight, is the ability to look all around and make sense of those waters, charting dangerous rocks, and reefs and identifying where the passage will be smoothest.
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[COUGH] When it comes to insight, I see four areas which are important for a successful executive, and indispensable for a true industry leader.
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The first is knowing what you get to do in your company, or what you get paid to do in your company.
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Of course that sounds ridiculous, but perhaps the most frequent failing of executives, who rise up through their organizations is staying engaged in minute details and relatively low level issues.
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In other words, keeping the keys to the workshop, the warehouse, or the sales room in your pocket even after you have been given the swipe card to the executive suite.
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In my case, I don't need to know every detail about how our real time remote drilling systems work.
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Or what kind of catalysts we are using in our refineries, or whether preventive maintenance has been carried out on a specific pump in any of our large plants.
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There are other people, who get paid to take care of those things, and they do it much better than I ever could.
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In a company like Saudi Aramco, we have hundreds of professional disciplines hard at work every day.
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As CEO, I don't need to know how they do their work.
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But what I need to know, is how to enable them to work together to ensure we meet our commitments as a company, that's what I and my management team get paid to do.
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Second, top notch executives use their time to stay engaged in their industries.
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They stay abreast of trends in the market and developments in technology.
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They know who their competitors and counterparts are, and what strategies they are pursuing.
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And they seek out mentors among experienced leaders in their area of business.
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By studying their industry, and engaging with others in the same field, sharp executives not only enhance their own professional attitude, and the performance of their organizations.
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But also create a network of contacts, which stand them in good stead throughout their careers.
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Third, it's essential that business leaders gain a high degree of comfort in transcending generational, and particularly cultural boundaries.
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Given the increasingly globalized nature of business, this level of confidence is essential for leaders of companies both large and small.
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Even if yours is a local or regional business and not a major multinational, it's highly likely that both your workforce and your customer base are multicultural and multi ethnic in nature.
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Cross cultural understanding is imperative actually.
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At Saudi Aramco, people of many different nationalities have worked side by side since the earliest time of the company and multiculturalism is hardwired in our corporate DNA.
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Although we are a state owned Saudi company, the official language of our business has always been English.
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And we send students every year to Japanese, Korean and Chinese universities to earn their degrees by studying in those languages.
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And today we have nearly 60 different nationalists represented in our workforce.
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And if by any chance you drop by our headquarters dining hall at lunch, you will hear not only Saudi Arabic and drawls from the Texas oil patch.
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But also Spanish, French, Tagalog, Hindi and a half dozen other languages.
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For me, that's a source of pride and yet another competitive advantage for my company because I know we can do business anywhere in the world and feel at home.
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Personally, I am fascinated by the societies and traditions of other lands and have benefited as a businessman by taking arduous hikes in Korea.
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Visiting ancient Japanese temples, prowling fragrant spice markets in India and journeying through the lush Brazilian rainforests.
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At the same time, I'm proud to be an Arab and seek to share my culture and interpret my heritage to others just as I study and sample theirs.
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And Mahatma Gandhi beautifully put it he said, I want the cultures of all lands to be blown about my house as freely as possible.
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But I refuse to be blown off my feet by any.
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Fourth, I think it is important to nourish your own innate intellectual curiosity.
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These outside interests might be a passion for the visual arts or music, an appetite for great literature and poetry.
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Keeping up to speed with the latest developments in science and technology, even pastime sports as participant or fan?
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Personally, I am a ferocious reader of world literature and current events titles.
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I love Italian and German opera and the classic and modern Arabic music.
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And of course there is nothing that can match playing with my two granddaughters.
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These things have sustained me throughout my time as CEO at Saudi Aramco because they are very, very enriching.
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Whatever inspires and informs you should continue to be a part of your regimen as you progress in the world of business.
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Because the rewards will remain with you long after the next quarterly performance review or annual board meeting.
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Ladies and gentlemen, I said earlier that innovation is the motor which powers our company's progress and insight enables us to make sense of the environment around us.
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But neither is complete without the third element in the Graduate School of Business mission statement, and that is a principle.
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This is the guiding light by which we must steer our ship and chart the course of our company.
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I believe principle underlies both of the others and in its absence we may do the job right but still not do the right job.
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To my mind, principle in business comes down to simply this.
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Identify your responsibilities as an organization or a company and make only those commitments that you are confident you can keep in an ethical manner.
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The issue of defining your organization's responsibilities is one that fascinates me and which has played an important role in my time as head of Saudi Aramco.
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I would like to share with you the way we view our purpose as a company.
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We have identified three key areas of responsibility or basic principles for Saudi Aramco, which has given rise to what we call the tripod concept.
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And these are first, our responsibility to keeping global petroleum markets reliably supplied, being of course the world's largest producer and exporter of crude oil.
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And the fact that we are the only company that is a main supplier to all the three major global market regions.
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We are the number one supplier of crude oil to economies like China, India, Japan and Korea, and a major provider of petroleum to Europe and the United States.
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As such, a large chunk of the global economy is running on our crude oil production.
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Second, we have a responsibility for the economic development of Saudi Arabia and the prosperity of its society.
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Which we fulfill not only through revenue generation but also by providing petroleum products to the local market.
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Supplying natural gas to industries and utilities across the country, including the Kingdom's massive gas based petrochemical industry.
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And through the goods and services we procure from the Saudi private sector.
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I would also include our far reaching corporate social responsibility programs and knowledge sharing initiatives in this category.
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Because of the profound positive effect they have had in local communities and companies.
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And third, there is our responsibility to our shareholder, the Saudi government, to conduct our operations in the most profitable, cost effective manner possible.
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We are a national oil company but retain the commercial Mindset and commitment to efficiency of a multinational.
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In fact, outside observers often see Saudi Aramco as a company with commercial sophistication, technological capabilities, and market savvy, And no less than any other international oil enterprise.
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This tripod concept helps us direct not only our existing business portfolio and industrial activities, but has proven invaluable when it comes to making investment decisions.
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Which, in our business, really comes down to building the next generation of the company.
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Since the plants and facilities we are building today will continue to be in operation 30 or even 40 years from now.
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That's because the tripod itself gives rise to a second concept, that of the Golden Quadrant.
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Simply put, we don't pursue each of the three legs of the tripod in isolation from one another.
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We look for the programs and investments that contribute simultaneously, I mean, as much as possible, to all the three areas of responsibility.
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For instance, when we look at a program, does this multi billion dollar project on the table help to enhance our operational reliability and our capacity to supply the market?
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Does it benefit the Kingdom and its society?
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And does it make good business sense over the long term?
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If the answer to all those questions is yes, then it stands a good chance to being green lighted.
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Our recent moves to integrate petrochemical facilities with refining assets in the Kingdom are an excellent example of this sort of golden quadrant program.
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Because many of the petrochemical products that will be produced will be exported.
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These facilities will help to meet rising long term global demand for petrochemicals and goods and materials made from them, particularly in the developing economies of the Far East.
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These projects will also create good jobs for Saudi nationals.
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And because they will form the hub of associated industrial clusters and manufacturing parks, they provide tremendous opportunity for the Saudi private sector, as well as international investors.
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And in terms of commerciality, these projects enable us to add more value to the Kingdom's precious hydrocarbon resources and further leverage our existing refining infrastructure.
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Put another way, they are win-win projects, and we are very bullish on their future prospects.
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However, there is one additional area of responsibility which underlies this tripod, and that is our commitment to protect and preserve the natural environment.
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Which to my mind is one of the most pressing and most complex challenges the petrochemical industry and indeed, our planet faces.
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At Saudi Aramco, you may not know this, but at our company we have had an environmental policy in place since the 1960s, long before the environment became a major concern.
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And we have an excellent track record of environmental stewardship related to our facilities and our operations.
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Now though, we are also engaging in a number of research and development activities related to environmental protection.
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Including cleaner burning fuels, desulfurization of whole crudes and refined products, and next generation engine technologies.
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We are also closely engaged in a number of carbon management initiatives within the industry.
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And partner closely with local and international universities and research institutes to conduct environmental studies.
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In fact, last week, as I told you, I was in China, and Saudi Aramco was presented, by that forum, was presented the award for environmental stewardship.
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We served first committee that after this group met in Rio two years ago, a group was formed and led by Saudi Aramco so that all national companies don't start from scratch to just exchange ideas.
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And if possible, pool resources so that really we can make a difference.
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[COUGH] Another area is that in Saudi Arabia we also have targeted children.
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We are working on children and adolescents, there's a lot of teaching that as part of our corporate social responsibility to teach the children the importance of the environment.
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The importance of keeping the proper environment, the importance of awareness of the dangers that are facing us in the future.
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And one other thing, Saudi Aramco two years ago brought people from all over the world.
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For the first time, we brought experts on carbon capture and carbon management from all over the world.
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And we had a three-day conference to bring awareness to the issues of climate change to our part of the world.
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We invited people from all over the Middle East and we had people from all over the world, experts of all, just so that we bring awareness.
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We keep to bring awareness to this issue.
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Even though we are an oil company, we are not throwing this issue under the carpet.
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We are really putting it on the table and we are talking about it and we are doing, hopefully a lot, but with others.
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At the beginning of my remarks I told you that by living these values and implementing these concepts, you could indeed change the world for the better.
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My conviction is based not on a philosophical premise or wishful thinking.
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But on my firsthand experience with Saudi Aramco as the largest and most reliable supplier in what is arguably the most important industry in the world.
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We believe Saudi Aramco's activities and operations touch or influence virtually every individual on the planet.
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Petroleum is an enabling industry to every other form of economic activity, from industry and manufacturing to agriculture and infrastructure development, healthcare, information technology, and telecommunications.
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And of course transportation.
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Oil and oil products help to fuel entire countries and communities, power economic growth and development and give a wide range of companies and institutions the energy they need to make their own commitment.
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As an oil man, I'm proud of that.
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And as a Saudi Aramco, I'm proud of the degree to which my company has contributed to that pool of energy for generations.
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But I'm most proud of the positive impact our petroleum energy has had on individual men and women the world over.
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I take pride in the fact that this morning our children could board a school bus fueled by petroleum.
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I take pride in the pharmaceuticals and life saving medical equipment developed from petroleum products, in the fertilizers which help farmers earn livelihood and in the film, packaging and fuel used to wrap their products and deliver it to our market and our tables.
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I'm also proud that our industry has helped and enabled people to live safer, healthier and more mobile and more dynamic lives.
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I believe that at Saudi Aramco we have helped to change the world, one neighborhood, one family and one individual at a time through the energy we provide.
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People in my company will tell you that we are in the business of making people happy.
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And that is a business that I'm fortunate to have worked in for the last 40 years of my life.
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Ladies and gentlemen, as I prepare to retire after a challenging and rewarding career, let me wish you every success in your own career, regardless of whatever sector of the economy, professional discipline or level in the organization your path may lead you to.
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Yours will be a different world of business in many ways from the one my generation has known.
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But I believe the sense of excitement, satisfaction and purpose that comes with business leadership will always remain constant.
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Ultimately, my friends, the key to realizing true success over your career is always remembering that as a leader you have both privileges and responsibilities.
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And never forgetting that your primary mission is tied not only to profits, earning statements, and share prices, but to making a positive difference in the lives of your people, your companies, and your stakeholders, and thereby changing the world for the better. Thank you very much.
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>> [APPLAUSE] >> Speaker 2: First, thank you for flying here.
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It's a true pleasure to have you share your experiences and knowledge.
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We really appreciate it, especially at the very last end of your career, to make this real step. We really appreciate it.
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One of the questions that seemed to be really of interest to a lot of people is that.
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The investor, Matt Simmons, who wrote the book Twilight in the Desert, has made a case for dwindling oil supplies in Saudi Arabia based on the advanced drilling techniques that Saudi uses in its fields.
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What are your response to this proposition and what are your views on the notion of peak oil?
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>> Speaker 1: Well, with all due respect, Matt is a fine gentleman.
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I know him, I meet with him and we talk together.
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But we came immediately when he brought, he was ready to issue his book.
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We brought our experts to Washington at the center for International Strategic CSIS in Washington and our people really just explained that Matt came to Saudi Arabia for a week.
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He is not an earth scientist in any way.
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He's a financial man and wrote a book what he said based on 200 papers that we presented.
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Those 200 papers were represented by our professionals in professional societies.
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These are not secret papers.
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These are papers that are out and our people were engaging others.
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And let me just liken what Mr Simmon on peak oil. Peak oil is a theory.
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A theory has certain assumptions and when you change one of those assumptions, that theory can go.
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The theory is that you have a constant amount of oil, constant amount of production.
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No, everything is being equal around you in alternatives on other sources of energy.
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Really it has been discredited.
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But it's like going back and looking at the medical file of a child and says he had fever when he was 2, he had measles at the age of 5, he had broke his leg when he was at 10.
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At 40, he has brain tumor and so on.
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And he says, if we look at all of those, then he must be dead.
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The question is, if he had fever, he was treated.
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But you look at one well in Ghawar that has 4,000 or 5,000 wells and the well has a problem.
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And you generalize, okay.
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I mean, this is the fallacy of composition they call it.
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As you look at one minute area and then Saudi Arabia, I can tell you we have consistently produced in excess of 3 billion barrels every year.
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And we have added to our reserves more than that or equivalent to that every year.
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So we did not have to draw down our reserves.
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Technology is enabling us to do a lot of things that we were not doing a whole.
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Maybe some of our people in upstream are here with you.
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They can sit with you and tell you how we manage our reservoirs and so on.
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Anyway, to make a long story short, that theory is truly discredited.
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If you ask all the people in the industry, they have no problem.
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They have no problem with our position.
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Okay, but anyway, next question.
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>> Speaker 2: Time will prove. Time will prove.
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Well, to build on that, the notion of peak oil has really moved the world to really different areas.
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And being in this part of the world, Silicon Valley, we see high determination to shift the world towards renewable sources of energy.
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We see venture capital firms and research institutions focusing on them.
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What are your views on this shift and do you view it as a serious threat to the Saudi economy?
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>> Speaker 1: Absolutely not.
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We are encouraging the development.
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Every additional BTU that we can make, we should make it.
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Because the world will need energy.
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However, what we should think about is that fossil fuels, coal, gas, and oil, fortunately or unfortunately, are going to be with us for the long haul, okay?
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So actually, we are looking at solar, we are looking at wind ourselves, okay?
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And we want to add, for every thousand US citizen, you have around 800 vehicles, the Chinese have only 20 or 30 vehicles for every thousand.
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So if the Chinese were to go to one quarter of the level of the US, okay, you need a lot of energy, and therefore, we need all sorts of energy. We encourage it.
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KAUST, the new university, is going to put a concentration on solar energy.
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And if you think of solar resources, there is no place that has more sun than Saudi Arabia.
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>> [LAUGH] >> Speaker 2: Well, that's good news for me at least.
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[LAUGH] Well, let me go to a more political question now.
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We noticed, especially during the presidential campaign, a large movement pushing for US energy independence, as well as complaints about US funds going to unfriendly countries.
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And unfortunately, Saudi has been mentioned a few times as one of these unfriendly countries.
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What are your views on this?
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>> Speaker 1: [COUGH] Political rhetoric is a short term business, the oil industry is very long term.
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>> [LAUGH] [APPLAUSE] >> But let me get down to, there is no such thing today, if what we see today of the economic situation of the world, there is no one who is isolated.
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So there is interdependence, and energy, it's interdependence.
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Oil is a fungible commodity, okay?
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If the US doesn't take it, China is going to take it.
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So it's one pool, we are taking from the same pool.
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And of course, if you don't want it to an unfriendly country like Saudi Arabia, you can go to your friends in Venezuela.
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I mean, this is another thing.
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>> Speaker 1: [LAUGH] >> But let me, no, seriously.
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>> [LAUGH] >> Seriously, let me just get back, what you pay at the pump is not what gets into the pockets of the Saudis.
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What you get in the pump, refiners take it from Saudi Arabia but then they ship it, they put it in pipelines, they refine it.
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They have a huge business in the US that part of what you pay at the pump is paying for bringing it to you in the US, this is a whole industry.
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But I think more important is, the money we get is not just money we spend for or not, Saudi Arabia needs funds for its, we depend on oil.
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And therefore, to have a stable Saudi Arabia and have a stable income is very important for the world, for the US and for Saudi Arabia.
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Second is that, I didn't talk about oil today, but Saudi Arabia is the only country that keeps between one and a half to two million barrels of extra capacity so that the world doesn't see any hiccup in its supply of energy.
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We keep that at an exorbitant price. A lot of money.
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Actually this capacity stood many a time between world economic peril and world economic prosperity.
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And in 2003, 2002/2003, that capacity came handy to elevate our supply to the US from 1.
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5 million barrels per day within four months to 2.
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2 million barrels per day.
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We covered the problems emanating from the Iraq-Iran War.
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We covered the upheavals of the loss of Kuwait and Iraq in 1990.
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We covered during the 2003 war, okay?
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And we continue to do our responsibility.
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The other thing is, a lot of this money comes back actually to the US to buy equipment, material, turbines, so that it can help for energy security of the US.
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If I buy 20 or 30 GE turbines and I take them to Saudi Arabia, actually they contribute to the energy security of the US.
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So the money doesn't go one way, a lot of it comes back, by the way, and we get a lot of it also when we buy food and material and we buy coffee, of course.
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>> [LAUGH] >> And a cup of coffee costs $3 and a cup of oil costs zilch.
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[INAUDIBLE] >> [LAUGH] >> Speaker 2: Well, just to be mindful of the time, we'd like to open the questions to the board now.
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>> Speaker 3: Do you think that unforeseen events such as the financial crisis, wars, technology development, or political development would make Aramco become the next General Motors or Lehman Brothers?
45:53
>> Speaker 1: One thing I can tell you, Saudi Aramco, we are the world's largest producer of oil.
46:02
We have a capability today of 11 million barrels per day, and we are raising it by next year to 12 million barrels per day.
46:09
We are producing much less now because of the demand.
46:13
But I have no debt on my balance sheet, because all of my capital program, which is for 5 years, is just under $100 billion, is financed from internally generated funds. This is very important.
46:30
So, no, you don't see Saudi Aramco, we have the resources.
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We have roughly one quarter of the world's proven reserves.
46:40
But I think the most important thing is that we really don't tap the financial market to finance our projects, only in our joint ventures we have joined them.
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But our program is totally from internally generated funds.
46:57
So we are not the next Lehman Brothers.
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>> [LAUGH] >> Speaker 2: Other questions?
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>> Speaker 4: What is your view on the role of various governments in manipulating production and thus influencing world prices of crude oil?
47:13
>> Speaker 1: Well, you are talking about OPEC, I'm not OPEC, I'm not going to comment, I'm a commercial company.
47:20
I do get instructions from my government as to what level of production.
47:24
But when the price was at 140, we are arguing there is no shortage in the market.
47:32
And there is no shortage in the market today, okay?
47:36
And I'm not going to defend what they do when they pull oil from the market, all it's because if the price goes way down, what you have is there is no investment.
47:52
And in oil, the problem is, it's not sufficient that you build a facility and that's it.
47:57
If you build a facility, To stay at where you are, you have to pump billions of dollars every year to keep producing.
48:10
The price is a price that can give the producers time to develop, I mean money to develop their economies, but also to give the companies enough money to make the investment so that we continue to provide that barrel here.
48:29
We have been a reliable supplier. We have been putting.
48:36
In the last three years, we have put increments, oil increments that are equivalent to the production of Venezuela, okay?
48:45
And we keep a cushion of roughly the production of Kuwait and the Emirates.
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These are major oil producers.
48:57
We produce oil that is equivalent to the daily production of Shell, Exxon, Chevron and British Petroleum combined together, okay?
49:10
All I'm saying is the movement they do, is so that the price really doesn't go way down where people will stop investment.
49:24
By the way, look what's going to happen on investment now, even when the price have reached 50.
49:32
When we were at 20, we didn't think the price will go to 60.
49:36
When we were at 140, we didn't think it will come down.
49:39
But at 140, there was a lot of oil in the market.
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And our customers are telling us they don't need oil.
49:49
It's only political circles that are talking about a shortage, but the refiners themselves. We offer oil.
49:57
Saudi Arabia put oil in the market and said come and take it.
50:00
Nope, there are no takers.
50:03
>> Speaker 2: Well, we have like three minutes left for the last question.
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>> Speaker 3: Same question thank you.
50:19
Following up on the issue of the price, as you pointed out, there's been a lot of speculation on oil futures that has been fueling up the price of oil over the past few months.
50:31
There has been calls in the US to think of commodities, to rethink the market for commodity futures.
50:37
I was wondering if you could share some of your thoughts on that concept.
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>> Speaker 1: No, we have always said what brought the price.
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And it's clear now what brought the price to 140 or close to 150 was speculation in the markets.
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People were playing the market.
50:54
And the king of Saudi Arabia, custodian of the holy mosque, King Abdullah, when the price was reaching around 120, 130, he called for a conference of producers and consumers to tell them, look, the market is well supplied.
51:12
The customers are saying there is no shortage of oil.
51:16
There is absolutely no reason for the price to go to where it went.
51:22
And there was no change in the market between the 140 and the 60 or 50 right now in terms of supply to the market.
51:33
So, yes, I think any regulation that will probably regulate you need a price discovery mechanism.
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And by the way, I mean this.
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We don't set the price ourselves. We don't set the price.
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We talk our customers and we say we'll look at what is traded in the market.
51:56
But that was the most efficient way of finding price finding between us and the customers that were acceptable to us and to them.
52:05
And if there is any, would be great if Stanford would come and give us a new method of price discovery and not be subject to what's happening in the market.
52:18
We would love to have that.
52:21
>> Speaker 2: This has been great.
52:22
Again, thank you so much, Mr. Jamal, for coming here. We really appreciate it. >> [APPLAUSE]