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OPEC president says oil market "well supplied"
AFP
CARACAS
Petroleumworld.com 06 01 06The world oil market is "well supplied," OPEC Conference President Edmund Daukoru told reporters ahead of a meeting here Thursday when the 11-member oil cartel will set its future production quota.
"Everybody has to do the best they can to moderate the (tight market) situation, but there is no question that the market is well supplied," said Nigeria's Minister of State for Petroleum on his arrival here Tuesday.
Oil reserves, he added, were at a five-year high, "so we have to look elsewhere for the cause of the tightness of the market."
"Downstream problems," the minister said, included "geopolitical tensions, refining capacity."
Asked what OPEC could do to lower crude oil prices, Daukoru said: "it's not the way to put it, but there are structural problems, there are also intangibles like the fear factor, and the fear factor is a major factor."
The Organization of Petroleum Exporting Countries began a series of consultations Tuesday in preparation for Thursday's conference, when market analysts believe they will decide to maintain their current production quota of 28 million barrels per day -- its highest level in a quarter century.
Venezuelan President Hugo Chavez on Tuesday said he hoped his fellow OPEC members would decide against any increase in production.
"The market supply is sufficient and there is no need to boost production to prevent a price drop and unbalancing a tight market," Chavez said during a brief visit to Quito.
"Indeed, we say there's an overproduction right now, but that's something we should talk about," the president said, adding that OPEC makes consensus decisions and that Venezuela "respects everybody's position."
Chavez said the cost of Venezuelan oil -- approaching 60 dollars a barrel -- "is a fair price."
He said the price of crude "must not fall below 50 dollars a barrel while the ceiling will be set by circumstances."Chavez said Thursday's "will be a very important summit."
AFP 31 0714 GMT 05 06
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