VIENNA, Sept 18: Opec kingpin Saudi Arabia was set on Sunday to lead the oil cartel to higher production quotas despite a slight easing of crude prices, saying it was looking ahead to when the northern hemisphere would head into winter. An increase would lend largely symbolic support to industrialized economies where consumers have begun to feel the effects of sharply higher energy costs.
Saudi Arabian Oil Minister Ali al-Nuaimi, a key figure in the Organisation of Petroleum Exporting Countries and among the first to arrive in Vienna for a two-day meeting that starts on Monday, gave unqualified support on Saturday for increased Opec production.
When asked if his country, the world’s biggest oil producer, backed a mooted rise in the group’s headline output figure, Nuaimi replied “absolutely yes”.
Opec president Sheikh Ahmad Fahd al-Sabah has proposed the official quota be raised by 500,000 barrels per day to 28.5 million bpd, which would be an all-time high since its creation in 1987.
An increase has also been backed to various degrees by the United Arab Emirates (UAE), Iran and Indonesia.
The decision will be made by all 11 Opec ministers expected to attend the meeting, but the Saudi position makes it likely the others will go along.
Yet analysts and Opec officials themselves maintain that the real reasons for high oil prices lie elsewhere.
Nuaimi acknowledged there was no real demand for more crude oil now, but added: “You have to look forward beyond today.
“Our next meeting is in December and things can change between now and December,” when winter begins in many industrialised countries.
His country stands ready pump up to 11 million barrels per day towards total Opec production from around 9.5 million at present, but Nuaimi did specify what the group’s new official output ceiling might be.
In Abu Dhabi, UAE Energy Minister Mohammad bin Dhaen al-Hamli told the official WAM news agency: “Should crude prices remain at their current levels or rise, the upcoming ministerial meeting might decide to increase production to calm world oil markets.” But he added that along with Iraq the cartel was already pumping around 30.2 million bpd.—AFP
