TEHRAN (Fars News Agency)- OPEC, the producer of more than 40 percent of the world’s oil, will leave production unchanged at its meeting today, an official from a Persian Gulf state involved in the talks said.
Qatar is among members of the Organization of Petroleum Exporting Countries opposed to a proposal to raise the current quota of 27.25 million barrels a day by 500,000 barrels, the OPEC delegate, who declined to be identified, said today in Abu Dhabi, where the group is meeting. Most OPEC members, including Iran, Venezuela and Qatar, have said they oppose an increase.
Oil has fallen more than 11 percent from a record $99.29 a barrel in New York on Nov. 21 amid speculation the group may produce more. Venezuelan Oil Minister Rafael Ramirez said the decline in prices means OPEC should reject a US request for more oil, while Saudi Arabia’s Ali al-Naimi and Qatar’s Abdullah al- Attiyah said the market has enough crude. OPEC agreed in September to raise output by 500,000 barrels a day starting Nov. 1.
“The case to raise production is not compelling for OPEC,” said David Moore, a commodity strategist at Commonwealth Bank of Australia in Sydney. “The outlook for demand in 2008 is uncertain and raising output may create a supply glut.”
OPEC’s internal production watchdog committee recommended the group maintain its current oil production targets, Iranian Oil Minister Gholam Hossein Nozari said.
The Ministerial Monitoring Committee, which comprises representatives from Iran, Nigeria, Kuwait and the OPEC Secretariat, met earlier today in Abu Dhabi. OPEC ministers are currently meeting in closed door talks.
Reuters reported OPEC has agreed to keep production unchanged, citing an OPEC delegate it did not identify.
Crude oil rose in New York on the news OPEC won’t raise production. Oil for January delivery on the New York Mercantile Exchange rose 77 cents, or 0.9 percent, to $89.09 a barrel at 9:20 a.m. London time.
Venezuela’s Ramirez and his counterpart from Iraq, Hussain al-Shahristani, said OPEC may need to meet again in early January to discuss output.
Saudi Arabia’s al-Naimi earlier today decline to speculate on the outcome of today’s meeting. World oil demand will rise by between 1 million and 1.2 million barrels a day in 2008, he said.
Oil ministers from Algeria, Iran, Venezuela and Qatar said today there are enough supplies in the market and there’s no need to boost output.
Oil prices are “very high” and ministers should respond, as energy costs increase and mortgage losses slow the economy, US Energy Secretary Samuel Bodman said yesterday in Washington.
The group, scheduled to meet again in March, will have an extraordinary meeting in late-January, the Persian Gulf delegate said.
Twenty-three of 42 analysts in a Bloomberg News survey this week, or 55 percent, expect OPEC members to maintain production at current levels. The rest expected an increase of between 500,000 and 750,000 barrels a day.
“OPEC will produce as much as required, but I don’t think it’s needed now,” Iran’s OPEC governor, Hossein Kazempour Ardebili, told reporters yesterday.
Venezuela’s Ramirez said the market was “well-supplied,” and his Qatari counterpart, al-Attiyah, said “I don’t see there’s any need” to raise targets.
Deutsche Bank AG Chief Energy Economist Adam Sieminski said yesterday that the exporter group’s “safest course” is probably to keep output targets steady and hold another meeting at its Vienna headquarters early next year.
Libya’s top oil official, Shokri Ghanem, said there’s no need for an increase in output as the market has sufficient oil. Yesterday, he said he is more concerned about fluctuations in the value of the dollar than oil prices, which he called “reasonable” in real terms.
Oil-exporting nations are paid in US dollars. But most OPEC members are considering calls by Iran and Venezuela for the group to price oil in other currencies.
OPEC’s 12 members pumped 31.14 million barrels of crude a day in November, while the 10 members subject to quotas produced 27.09 million barrels a day, according to Bloomberg estimates published yesterday.