Saudi Arabia's Shura council (parliament) will hold a series of meetings over the next two weeks to discuss a controversial proposal by a key member to curb oil production to save reserves for better prices, Saudi media reported. The council will listen to a report by deputy chairman of the Shura water and public utilities committee, Salim bin Rashid Al Marri, who will argue for cutting crude supplies to maintain the Kingdom's underground reserves.

"Marri will seek to persuade council members that the oil production must be linked to the country's actual development needs not the needs of foreign consumers," Alriyadh newspaper said in a report from the capital Riyadh. "He will tell the Council that keeping sufficient oil quantities underground is a good investment for the future as oil prices will then be higher…he will argue that this will be better than producing more oil and generating financial surpluses on the grounds these surpluses are causing inflation."

Saudi Arabia is the world's top oil exporter and its crude policy is normally determined by the King as the oil minister's job is mainly to implement that policy.

According to analysts, any major increase or decrease in the Gulf Kingdom's crude production must be approved by the Monarch, who was reported last week to have heeded a call by US president George Bush and agreed to lift output by nearly 300,000 barrels per day to cool down boiling crude prices. Saudi Arabia, which controls nearly a quarter of the world's total extractable oil deposits, has pumped an average of nine million bpd over the past year but its sustainable output capacity is almost two million bpd higher.

To face an expected increase in global demand, Riyadh is investing heavily in projects to boost its oil production capacity to 12.5 million bpd at the end of 2009 and maintain its traditional spare capacity of more than two million bpd.

"The price of oil under ground is actually higher than its current market price because it will become a unique commodity by time and demand will continue to rise because of a steady growth in the world's population," Marri told Alriyadh.

"The level of oil production in Saudi Arabia must be linked to the country's actual development and financial needs not to market prices and the need of foreign consumer. It is not wise to sap this resource just to satisfy the demand of foreign markets. Therefore, we need to revise our oil production policy before it is too late. Preserving our oil reserves is better than investing our financial surpluses which could lead to inflation."

According to the newspaper, Marri scoffed at what he called fears that the price of oil will decline after the development of more energy sources. "These fears are unjustified because they come from the consumers who are only benefiting from higher production and from the country's enemies who do not like to see prosperity and progress in Saudi Arabia," he said."Even if other major sources of energy are developed, they will remain costly and oil will remain a strong rival in the energy field. "