OPEC决定不增产

henry

OPEC Ministers Decide
To Hold Oil Output Steady
By CHIP CUMMINS
December 5, 2007 8:08 a.m.

ABU DHABI, United Arab Emirates -- OPEC ministers said Wednesday they wouldn't open petroleum spigots any wider, a move that was expected after a recent slide in prices relieved pressure on the cartel to pump more crude.

In London trading, Nymex light, sweet crude futures rose $1.93 to $90.25 a barrel and Brent was up $2.04 at $91.57 a barrel. After climbing to $98.18-a-barrel late last month, the benchmark U.S. futures contract had dropped below $90. That appears to have lessened pressure on ministers of the Organization of Petroleum Exporting Countries to boost output.

After a closed-door meeting here Wednesday, delegates told reporters they had decided to stand pat for the time being. Libya's oil-policy head, Shokri Ghanem, said that OPEC has opted to leave its current output unchanged, but would meet again on Feb. 1 to take stock of the market.

The cartel controls some 40% of the world's oil supply, and the collective decisions it makes to raise or lower members' overall production quota has long been a crucial influence on the price of oil. As oil ratcheted higher all year, producers have blamed the increase on financial-market speculation and the weakness of the dollar. But some expressed worry that -- whatever the reason -- prices were getting out of hand, raising the possibility that they would act to increase supply.

Despite the recent price fall, the Bush administration has called for increased output, saying that supplies remain tight and prices too high. But energy ministers had in recent days sent out increasing signals they intended to do nothing for the time being. A big worry among producers is that a global credit-crunch could lead to a significant economic downturn in parts of the industrialized world, reducing demand for oil.

Concern isn't so much a short-term one, as most of the industrialized world is now entering the high-demand winter season. The more complicated calculation is what will occur in the spring, when winter demand typically subsides. A February meeting will help ministers assess fresh data and revisit their decision.

Geopolitical concerns have also eased after the release in Washington of an intelligence assessment that said Iran appears to have ceased efforts to acquire nuclear weapons back in 2003. As Washington and Tehran increasingly sparred over Iran's refusal to give up what it has said is a peaceful effort to develop nuclear energy, worry in the market has increased over the security of supplies from the oil-rich Persian Gulf.

Before the meeting in Abu Dhabi's Emirates Palace hotel, several ministers said they didn't see the sort of heightened demand that would warrant a production increase. Saudi Arabia's oil minister, Ali Naimi, told reporters that "all options are open" for the cartel, but the cartel's unofficial leader has argued in recent weeks that the market is already sufficiently supplied.

Algeria's energy minister, Chakib Khelil, said in a weekend interview that it didn't make sense for OPEC "to be talking about increasing or decreasing [production], because we really don't know whether the market really demands it." He argued that global stockpiles could rise markedly in the second quarter of next year if demand slumps by as much as two million barrels a day, as some in OPEC predict.

Oil-inventory levels in the U.S. and elsewhere are viewed as ample, especially if the winter is a mild one, said Qatar's oil minister, Abdullah bin Hamad al Attiyah.

Oil traders now predict that oil prices will continue to drop into the mid-$80s over the next month or so. But a shortage of world-wide excess capacity, they say, could still drive benchmark-crude prices back into the mid-$90s. OPEC produces about 32 million barrels a day at time when the world is consuming nearly 85 million barrels a day.