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OPEC: Political tension keeps oil on boil
Reuters
LONDON
Petroleumworld.com 03 29 07
Oil prices have risen because of political tension over Iran and there is no need for Opec to pump more oil, the exporter group’s secretary-general said on Wednesday.
Oil was trading above $64 a barrel on Wednesday, with traders still rattled by a $5 spike overnight on a rumour, quickly dismissed by the Washington administration, that a US naval vessel had clashed with Iran.“The increase is due to the geopolitical situation. This is a risk premium. I hope the situation will be resolved peacefully very soon,” Abdullah al-Badri told Reuters by telephone from Opec’s Vienna headquarters, adding “As far as we are concerned, the supply and demand situation is balanced, it’s fine. There is plenty of oil in the market.”
Opec, which pumps more than a third of the world’s oil, agreed at a March 15 meeting to keep current oil output restraints in place. There is no need for more supply from members at the moment, Badri said.
“No...there is nothing wrong with the fundamentals at this time.
Maybe there is a gasoline supply and demand tightness in the US, that’s because of the refinery problems there.”Gasoline has been rising ahead of the summer driving season in the US, when demand rises. A US government report later on Wednesday is expected to show inventories fell for a seventh straight week.
The Organisation of the Petroleum Exporting Countries had agreed supply curbs totalling 1.7 million barrels per day, or 6% of supplies, at meetings last year.
Opec holds its next scheduled meeting in September and Badri said he did not expect the group to gather before then to discuss the market.
Reuters 28 03 07
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