The government said the move was to encourage development in the country of 24 million, where hundreds of thousands of people have been hurt by a two-month stock market sell-off.

But participants at the region's first Carbon Management Symposium on global warming, organised by state oil giant Saudi Aramco, criticised the price cut.

"There's an obvious argument that you shouldn't have such cheap gasoline ... because you then see an all-motorised society, no bicycles, no pedestrians," Robert Socolow, an engineering expert at Princeton University, told the forum.

The price cut, which came amid record high oil prices, reversed hikes in 1999 when Saudi Arabia was searching for ways to compensate for low oil prices that had dented state revenue.

"Oil is cheaper than water here," joked a scientist from Sweden who had given a paper on technology for efficient removal of carbon dioxide.

Aramco announced at the gathering that it would join other oil majors who have begun research into reducing emissions in the oil and gas industry, which experts said accounts for up to 40 percent of annual carbon dioxide increases in the atmosphere.