SYDNEY, Sept 8: Opec President Purnomo Yusgiantoro blamed a "political premium" of $10-15 a barrel for soaring oil prices on Wednesday, saying, the oil cartel is exceeding its supply quotas but the market is not responding.

Purnomo said Opec was concerned about the high oil prices but exceptional circumstances restricted its room to manoeuvre on the issue. "According to our view based on the fundamentals -- supply and demand values - the price should not be as high as what we see today," he told reporters at the 19th World Energy Congress in Sydney.

"What we see is a political premium between $10-15 per barrel." Purnomo, who is also Indonesia's Energy Minister, cited market speculation and geo-political factors including unrest in the Iraqi city of Najaf and the Russian government action against the country's largest oil producer Yukos, for the high oil price.

He expects prices to fall from the current levels of more than $40 by the end of the year, based on contracts exchanged on oil futures markets. Asked to speculate on how much the price could fall he replied: "Boy ... five dollars a barrel?"

In Asian trade on Wednesday, oil prices continued to weaken as concerns over the possible impact of Hurricane Frances on the southern US states which are home to major oil production and refinery facilities faded.

In early afternoon deals, New York's reference contract, light sweet crude for October delivery was at $43.22 a barrel, down from the $43.31 close on Tuesday. Purnomo also said the Organization of Petroleum Exporting Countries was likely to change its target band of 22 to 28 dollars a barrel at a meeting in Vienna on September 15.

He refused to comment on where the revised band might be set but said it would reflect the impact of inflation and depreciation of the US dollar since the current target band was set in 2000.

Purnomo previously told reporters at the congress that Opec target band could be set at $26-34. He was non-committal on whether this month's meeting would authorize an increase in oil supply to force down prices, saying world supply was already exceeding demand by by 2.7 million barrels a day.

"We will see after we have updated our figures," he said "There is a monitoring committee that will be reporting to us the day before the conference ... I have no information from them yet." Opec represents 11 countries - Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela.

Purnomo said the cartel's quota was 26 million barrels a day but it was currently pumping almost 30 million barrels, although he conceded the two million barrels a day from Iraq fluctuated according to the security situation. -APP