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KUWAIT, April 16: Opec is likely to postpone a further production increase for the time being if prices continue to retreat, a spokesman for the oil producers’ cartel was quoted on Saturday as saying. The Organization of the Petroleum Exporting Countries in March agreed to raise production quotas by 500,000 barrels per day and said it would consult on another 500,000 bpd increase if prices continued to rise.
Kuwait’s state news agency KUNA quoted Opec spokesman Abdel-Rahman al-Khreiji as saying in Vienna that he expects “that the increase will be postponed for the present time in the event that oil prices continue to fall”.
Khreiji also said Opec prefers to bide its time until the “opaque” market picture clarifies.
Opec President Sheikh Ahmad al-Fahd al-Sabah, also Kuwait’s energy minister, said on Monday the group was on track to boost supplies by 500,000 bpd next month, but
dissent was emerging from
other members over whether a second output increase was
warranted.
Oil prices resumed their slide on Friday from last week’s record peaks, with US light crude slipping to near $50 per barrel, as swelling stockpiles in the United States, the world’s largest energy consumer, countered worries over rising global demand.
Prices have fallen about 13 per cent from last week’s all-time high above $58 a barrel.
“Prices holding at levels
that the organization sees as high will push the cartel to
look into an additional output increase,” KUNA quoted Khreiji as saying, adding instead “prices have declined in a noticeable way for a seventh day in a
row”.
He said prices have fallen
due to factors including recent data showing a rise in United States petroleum stockpiles, adequate supplies on the markets as well as geopolitical reasons and speculation on the oil futures markets.
He said it was difficult to ascertain where prices will
head next but pointed out
“that in light of the rise in global stockpile levels, there are some convincing reasons that point more to a possible decline in prices”, KUNA added.
—Reuters
