OPEC has done what it can to help the global economy and is powerless to influence the turmoil in global financial markets, the group's president said Thursday, putting the possibility of a recession in the U.S. at 40%.
"I don't think we have seen the (full) extent yet," of the U.S. subprime mortgage crisis and economic slowdown, said Chakib Khelil, who is also Algeria's oil minister. "We may not see the full ramifications before 2009."
In a press briefing with reporters ahead of an OPEC ministerial meeting Friday, Khelil said it would be hard for the oil cartel to either raise or lower production now.
"I don't see what increasing the supply of oil could do, I doubt it can help on the price issue," he said. Conversely, "production cuts are not in the cards because psychologically it's not possible...", noting that this would potentially spook the world economy.
He acknowledged that some producers within OPEC were under more pressure to raise output and put a dent in oil prices trading above $90 a barrel.
"Some members are most exposed to political pressures and may be more in favor" of taking action to relieve those pressures, Khelil said. Present conditions "militate in favor of not doing anything."
Khelil said 2008 was looking to be "probably the worst year we've had."
"Everything is hodge podge," he said. "There's no clear view on anything, politics, monetary and fiscal policy."