OPEC: production near capacity

| May 9, 2005 | 0 Comments
OPEC: production near capacity

The president of OPEC said Sunday that it will not raise production when its member nations meet in Vienna in June.

On Monday, he clarified that statement by saying that all members of OPEC are already producing oil at near-capacity and said that Saudi Arabia was pumping 10 million barrels of crude oil a day.

While OPEC officials could not confirm the figure for Saudi Arabia, they said that the 10 OPEC member nations subject to quotas were producing around 28.2 million barrels per day.

Including Iraq, which is not subject to quotas, the total came to 30.2 million barrels per day being pumped. This is above OPEC’s official ceiling of 27.5 million barrels per day.

All this, the OPEC president said, would keep the market supplied at adequate levels. However, Algeria’s energy minister claimed over the weekend that even pumping at full capacity, OPEC might not be able to meet fourth quarter demand if sufficient inventories were not built up ahead of that time.

US crude oil reserves currently stand at 327 million barrels. With ample production by OPEC, most analysts believe that oil prices may fall, at least in the short term.

At midday Monday, West Texas Intermediate for June delivery was up 9 cents to $51.05 per barrel in New York, but in London in the late afternoon, June Brent was down 5 cents to $50.72 per barrel.

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