OPEC poised to pump down prices

The OPEC oil cartel is likely to hold a formal meeting in Amsterdam next week to approve an increase in production for bringing down spiralling prices.

Soaring prices have prompted calls for increased production
Soaring prices have prompted calls for increased production

Qatar’s Energy Minister Abd Allah bin Hamad Al Attiyah on Saturday said chances were bright for the informal meeting of OPEC ministers on the sidelines of an energy summit between 22-24 May becoming a formal meeting of the 11-member cartel.

“We will meet first to consult, if we reach an agreement, we change it to an extraordinary meeting,” the minister said.

The oil cartel’s next formal meeting is currently scheduled for 3 June in Beirut.

“The fear factor is adding $8 to prices”

Abd Allah bin Hamad Al Attiyah, Qatari energy minister

Al Attiyah voiced support for OPEC kingpin Saudi Arabia’s call for an increase of 1.5 million barrels a day of the production ceiling of the organization.

“I think this is a good indication that OPEC is doing its best to check the rise in oil prices,” the minister said.

All-time high

Oil prices have risen sharply recently and on Friday, a barrel was selling at an all-time high of $41.56 in New York.

Al Attiyah, however, said the high prices were caused by political fears and not a shortage on the market.

“The fear factor is adding $8 to prices,” he said. “I checked with all our lifters and end users and asked one question: do you feel there is a shortage of oil? Their answer is no.”

Analysts have listed security fears over terrorist attacks in Iraq and Saudi Arabia as the main reasons for the price increase.

Al Attiyah said the Organisation for Petroleum Exporting Countries was already producing more than 1.5 million barrels a day above its official ceiling of 23.5 million barrels a day.

But he refused to put a figure on OPEC’s likely increase in production if the organisation agrees on it at its meeting in Amsterdam or in Beirut.

Source : News Agencies

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