December 06, 2007	Thursday	Ziqa'ad 25, 1428

ABU DHABI, Dec 5: Opec froze oil output levels on Wednesday, resisting calls for a hike to help cool sky-high prices that have flirted with $100 and which threaten to dampen global economic growth.

The Organisation of Petroleum Exporting Countries decided against an increase of 500,000 barrels per day to its official production levels at a ministerial meeting in Abu Dhabi, insisting the market was “well supplied.”

But in Paris the International Energy Agency, which monitors energy policies in developed countries, said consumer anxiety about oil shortages would remain, even if Opec was producing above its daily ceiling of 27.25m barrels.

Opec, which produces about 40 per cent of the world’s crude, insisted on Wednesday it was not responsible for the price of crude soaring to a record high of $99.29 a barrel on November 21.

“The market is not controlled by supply and demand ... It is totally controlled by speculators who consider oil as a financial asset,” the cartel’s secretary general Abdalla al-Badri told a press conference.

On Wednesday, Opec also announced an extraordinary meeting for February 1 in Vienna, “given the need for extreme vigilance in assessing the market during the coming months”. The cartel would still meet on March 5 for its scheduled gathering.

Opec’s latest output decision was reached after oil producers put aside differences.

“The decision was the result of some compromise between hawks and doves in discussions,” Barclays Capital analyst Costanza Jacazio said.

On Tuesday, Saudi Arabia had said all options were on the table, which suggested it temporarily favoured an output hike.

Saudi Arabia, the world’s biggest producer of crude, is the only Opec member with sustainable spare capacity.Among Opec’s 13 member-nations that had firmly opposed a supply increase in the UAE capital were Iran, Libya, Qatar and Venezuela.

They were concerned that an increase in production would oversupply the market during the second quarter, when demand for heating fuel falls as winter passes. —AFP