OPEC Governors Chmn:Oil Output Hike Possible,Others Disagree

OPEC Governors Chmn:Oil Output Hike Possible,Others Disagree
DJ
Δευ, 21 Ιανουαρίου 2008 - 06:17
AMMAN (Dow Jones)--The chairman of OPEC's board of governors Monday said some in the group could press for an increase in output of as much as a million barrels a day at its Feb. 1 meeting, a view that contrasts sharply with oil ministers and other officials who have rejected any notion of a hike.
"Perhaps some members of the organization would call strongly for an output increase by 500,000 to 1 million barrels a day," Falah Alamri, head of Iraq's State Oil Marketing Organization and the country's governor to the Organization of Petroleum Exporting Countries, told Dow Jones Newswires in a telephone interview from Baghdad.

Dow Jones Newswires estimates the 13-member cartel pumped some 32.2 million barrels a day last month, almost a million barrels a day above the implied need for its crude, as forecast by the International Energy Agency, in the lower demand April-June period.

Alamri didn't identify those countries that he said would favor an output hike but said they would need to persuade members against any output change and a majority could "be in favor of increasing output by 500,000 to 1 million barrels a day."

A person attached to an influential Gulf OPEC member delegation and a separate official familiar with the group's thinking ahead of the Feb. 1 meeting both rejected Alamri's comments Monday.

Data presented by the head of the U.S. Energy Information Administration Guy Caruso to Saudi Arabian officials in Riyadh Jan. 19 indicates that falling oil stocks held by rich, industrialized countries warrant OPEC action, U.S. Secretary of Energy Samuel Bodman told Dow Jones Newswires in an interview Monday.

"The data shows there is a decline during the bulk of 2008. Maybe in all of 2008 we will have a decline in the amount in inventories," Bodman said. "Our view is that the market is looking at that decline and responding to it with higher prices. The question of the data I don't think is in doubt."

Increasingly, OPEC is seen as unlikely to raise output when it meets in Vienna, given the shakedown underway in the economies of the U.S., Europe and elsewhere combined with weaker oil prices and the end of the Northern Hemisphere's winter.

The Paris-based IEA trimmed its global oil demand growth forecast for this year from 2.5% to 2.3% in last week's oil market report, a figure that some analysts think remains too high.

At the start of this year, light, sweet crude futures in New York briefly hit $100.09 a barrel, the highest nominal figure since Nymex introduced crude futures trading in March 1983.

Jitters over the credit crunch that is cutting a swathe through the financial and housing sectors in the U.S. and European economies have driven out some market participants from oil, resulting in a 10% decline to below $90 a barrel in a little over two weeks. At 1350 GMT, U.S. light, sweet crude futures were down $1.72 a barrel, or 1.9%, at $88.85 a barrel.

OPEC Secretary General Abdalla Salem el-Badri told German weekly magazine Der Spiegel in an interview published Sunday that he currently doesn't see a need for increasing oil output.

However, "if we come to the conclusion that the fundamental data warrant an increase in production, then oil ministers won't hesitate to decree this."

"I believe we will see a rollover during the Feb. 1 meeting," a senior official with a top five OPEC producer said last week.

He that that OPEC should consider cutting output in March when the cartel meets again in readiness for a slowdown in winter demand from the northern hemisphere.

"We would be bracing for the low demand season, so there won't be need for as much oil in the markets," the delegate added.

"I don't think there is a need for any action by OPEC," Shokri Ghanem, the head of Libya's National Oil Co., said last week. "Consumers have enough supply and prices are falling."

Iraq's Alamri said that oil prices, currently determined by a weak dollar that had attracted speculators to the oil market and a lack of refinery capacity, are likely to range between $85 and $95 a barrel in the January-to-March period but are harder to forecast beyond that.

OPEC officials have repeatedly asserted that high crude oil prices are largely the result of market speculation and geopolitical factors, not fundamental supply concerns, and is thus beyond its control.

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