OPEC shrugs off pleas to raise supply of crude oil
OPEC yesterday dismissed further calls to boost oil output from top consumer the United States, saying the global market is well supplied and the producer group has little control over oil prices near US$90 (HK$702) a barrel.
Qatar’s oil minister said there is no need for OPEC to boost output at its February 1 meeting.
In the past week, US President George W Bush and his Energy Secretary Sam Bodman have both urged the Organization of Petroleum Exporting Countries to pump more oil to ease the impact of record prices on the world’s largest economy.
“I don’t think there is a need to increase because the market is well supplied,” Oil Minister Abdullah al- Attiyah said.
OPEC, source of more than a third of the world’s oil, stood ready to boost supply when the market needed it, he added.
“If the market needs more oil we will be there,” he said.
Last week, Attiyah said OPEC would need to be cautious ahead of the seasonal fall in consumption in the second quarter and because of the possible effect on oil demand of an economic slowdown in the United States.
Attiyah blamed the high price of oil on speculation in futures markets rather than on any problem in supplies. US crude settled at US$90.57 a barrel on Friday, having fallen from a record of over US$100 earlier this month.
“You have to segregate the physical market from the paper market,” he said. “We’ve checked with our clients and they’ve confirmed that they don’t feel there is a need for more oil. Oil inventories are comfortable.”
Bodman, who is touring the Middle East, has told Saudi Arabia that OPEC should increase oil output. He met Saudi Oil Minister Ali Naimi in Riyadh over the weekend.
Naimi said earlier that Saudi Arabia would raise production levels only when the market justifies it, and that the current inventory seemed normal.
Last week Bush visited the region and raised the same concerns in Saudi Arabia. Saudi Arabia’s King Abdullah told Bush he was worried about the effect of high oil prices on the world economy - but there was no commitment from the king about increasing oil output.
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