OPEC tries to keep oil output limits on hold
VIENNA – Reuters
The Organization of the Petroleum Exporting Countries (OPEC) were preparing to keep oil output limits on hold on yesterday, leaving swing producer Saudi Arabia to unilaterally decide whether it needs to scale back supplies to stem a price slide.
Most in the OPEC members want cartel number one Saudi Arabia to cut back to defend oil prices at $100 a barrel but Riyadh is keen to prevent high fuel costs hampering a return to stronger economic growth in the West.
Extra oil from Saudi is largely responsible for lifting OPEC output to 31.6 million bpd, well in advance of the group’s formal 30-million-bpd target.
“In my opinion we should be keeping to the ceiling, the ceiling we agreed in December,” said Angolan Oil Minister Jose de Vasconcelos.
“In all probability,” OPEC would retain that formal target, said Kuwaiti Oil Minister Hani Hussein.
Saudi Oil Minister Ali al-Naimi, though, has often surprised in the past and caused some uncertainty earlier in the week.
First he suggested OPEC might need to lift its collective limit to match forecast demand for the rest of the year -- estimated by OPEC headquarters at 30.7 million bpd. The next day he said said he was happy with policy as is.
Iran, often at odds with Saudi Arabia at OPEC, appeared in no mood to squabble at this meeting, despite being unhappy that a fall in prices has coincided with a drop in its exports because of Western sanctions against its nuclear program.
“We object to the drop in prices,” said Iranian Oil Minister Rostam Qasemi.
A meeting between Saudi Oil Minister Ali al-Naimi and Qasemi passed amiably, delegates from the two countries said.
Oil prices have dropped from a $128 peak for the year in March to $97, in part because the economic outlook has darkened but also because of increased Saudi output that in April set a 30-year high of 10.1 million barrels a day.
The OPEC meeting was continuing when the Daily News went to print yesterday.