Opec rejects US calls for more oil

Saudi oil minister rules out increase in output since 'market is well supplied'.

    The US energy secretary argued for an
    increase in oil supply[EPA]
    Abdullah al-Badri, Opec secretary-general, said the Organisation of Petroleum Exporting Countries was keeping a close eye on the market and stood ready to pump more when needed.

     

    "If we reach the conclusion that fundamental data warrants an increase in production, then our oil ministers will not hesitate to decree this," al-Badri said in an interview published by a German magazine on Saturday.

    "But at present we see no need for this," he said.

    US plea

    Bush and Bodman, concerned about the impact of high prices on the US - the world's largest economy - have said more oil would help ease tight supplies.

    "It's important there's an increase in supply," Bodman said on Saturday.

    "The figures would indicate a call for increased supply," he said.

    Saudi Arabia is Opec's most influential member and the only one among its 13 members able to boost supply significantly at short notice.

    But Opec, which produces more than a third of the world's oil, said it has little control over oil prices hovering around $90 a barrel.

    The producer group said that price speculation has divorced the oil price from market fundamentals, leaving it with little power to tame high energy costs.

    "You have to segregate the physical market from the paper market," al-Attiyah said on Sunday.

    "We've checked with our clients and they've confirmed that they don't feel there is a need for more oil. Oil inventories are comfortable."

    Last week, al-Attiyah said Opec needed to be cautious ahead of the seasonal drop in consumption in the second quarter and because of the possible effect on oil demand as a result of a US recession.

    US crude oil prices settled at $90.57 a barrel on Friday, having fallen from a record of over $100 earlier this month.

    SOURCE: Agencies


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