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OPEC agrees on need for cut, to decide on timing: minister
AFP
ABUJA
Petroleumworld.com 12 14 06OPEC oil ministers agree on the need to restrict their oil production but have not decided on the timing of an output cut, Algeria's energy minister said Thursday.
"I think there is a consensus for a reduction but we don't know if it is going to be applied straight away or later," Chakib Khelil told reporters.
OPEC ministers were meeting in the Nigerian capital Abuja to discuss their production policy. A formal decision was expected later Thursday.
The Libyan representative to the 11-member group, Shukri Ghanem, said that OPEC would decide to keep its production target of 26.3 million barrels per day (bpd) unchanged.
"My impression is that there will be no cut today," he said. "If there is a need (to cut), we will do it, but not today."
The Organisation of Petroleum Exporting Countries, whose members produce about one third of global oil supplies, decided in October at a meeting in Doha, Qatar to cut their output by 1.2 million bpd.
"We are satisfied with what's going on. The decision of Doha was great, I think. The market is stable now," said Kuwaiti Energy Minister Sheikh Ali Jarrah al-Sabah.
OPEC decided to cut production by 1.2 million bpd in October to stem falling oil prices, which had dropped from about a high of 78 dollars per barrel in July to about 58 dollars at the time of the meeting.
Indonesian Energy Minister Purnomo Yusgiantoro suggested that the group would meet again early next year, possibly to take a decision to cut production.
"The market is stable. I may propose to have some kind of meeting before the entering of the Spring session, before March," he said. "Because you know in Spring, demand is slowing."
World oil futures climbed on Thursday ahead of the meeting.
New York's main contract, light sweet crude for delivery in January, rose 30 cents to 61.67 dollars per barrel in electronic deals before the official opening of the US market.
In London, Brent North Sea crude for January delivery gained 23 cents to 61.56 dollars in electronic trading.
In assessing their production policy, OPEC members are mindful that the coming winter months in the northern hemisphere are the peak oil period of the year.
Analysts have warned that a cut could send prices back to uncomfortably high levels, which OPEC would want to avoid.
Nevertheless, Venezuelan Energy Minister Rafael Ramirez repeated his call for a further cut of 500,000 bpd, adding that compliance to the reduction in October should be observed.
"We want to get out of the market 500,000 bpd from the existing level," he said.
Actual production has been cut less than announced in October, analysts say, with the real reduction estimated at between 500,000-800,000 barrels per day because of over-production by some members.
AFP 14 1131 GMT 12 06
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