OPEC leaves production levels unchanged

The Organisation of the Petroleum Exporting Countries agreed to leave oil production unchanged at 25.4 million barrels a day, keeping prices of crude oil at the top end of the group’s $22-$28 target range.

OPEC President Abdullah al-Attiyah keeps tight grip on production
OPEC President Abdullah al-Attiyah keeps tight grip on production

Production levels will be reviewed again in September,  an unidentified OPEC spokesman said at an extraordinary meeting of the cartel’s members in Vienna Thursday.

“Having reviewed the current market situation the conference
noted that the market is stable,”  the spokesman told journalists, AFP reported.

“The conference therefore decided to maintain current agreed
production levels until its next meeting.”

The group will next meet on September 24.

Prices rise

US crude in electronic trading rose three cents to $30.71 a barrel.

Hopes that oil prices were set to fall after the end of the US-led war in Iraq have been dimmed by slower than forecast progress in getting the conflict-damaged country’s exports back on line.

Decrepit infrastructure, looting and sabotage have all impacted the country’s oil production and its exporting capability.

Analysts believe that Iraq’s oil production will be unlikely to impact OPEC decision making until later this year.  

“Prices will remain firm and inventories will stay relatively low leaving OPEC in good shape to address the more challenging environment next year when output cuts very likely will be necessary,” Gary Ross, chief executive of New York consultancy PIRA Energy told Reuters.

Iraq delays

Iraq’s production is not expected to exceed 1.5 million barrels per day before the end of the year, Ross said.

OPEC is waiting for the international community to recognise an official Iraqi government before inviting an Iraqi representative to its meetings.

OPEC controls the price of oil by increasing or decreasing production levels.

Source : News Agencies

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