Opec implementing September decision

Opec implementing September decision
Reuters Published: October 24, 2007, 23:44 (GULF NEWS)

Beijing: Opec Secretary-General Abdullah Al Badri said the group was implementing a decision taken in September to increase production by 500,000 barrels per day (bpd).

Opec countries agreed to increase oil output from November but the Petrologistics consultancy, which tracks tanker movements, said on Tuesday it was already raising oil supply this month in response to record high prices.

Asked on a visit to Beijing if Opec had already started increasing production by half a million bpd from October, Badri would only say: "We are implementing our decision we took in September, at the last conference, that are we going to increase production by 500,000 bpd from November 1."

Opec's 10 members subject to output limits, all except Iraq and Angola, are set to pump 27.5 million bpd in October, up from a revised 27.2 million bpd in September, said Conrad Gerber of Petrologistics.

Output from Opec is set to rise 500,000 bpd to 31.4 million bpd as a result of higher shipments from Iraq and Angola, it said.

The estimate indicates that Opec may be relaxing adherence to supply curbs, as oil prices hit a record of $90.07 a barrel on Friday, fuelling fears that higher energy bills could strangle global economic growth.

Crude prices fell below $85 yesterday on signs that Opec was boosting production and on forecasts that US oil inventories likely rose again heading into the key winter demand season.

Javad Yarjani, head of Opec affairs at Iran's Oil Ministry, said there was no shortage of oil in the market and that prices were being driven up by fear rather than fundamentals. "As far as future consumption, and stocks [is concerned]... there is definitely no shortage of crude oil. You may see in some places, some shortage, but that is again because of lack of refining, or sometimes glitches at refineries," he said.

OPINION
Output should rise by a further 500,000 bpd
Opec should raise oil output by a further 500,000 barrels per day to ensure sufficient supply in the fourth quarter when seasonal demand rises, an Opec delegate said yesterday.

The comments contrast with recent remarks from Opec officials that world oil markets have enough crude oil and that a surge in prices to record highs reflects factors beyond the group's control.

"My personal view is I think we need to increase another 500,000 bpd in November," said the source, one of the more senior delegates in Opec.

Leaders of Opec member countries gather on November 11-18 in Riyadh for their third heads of state summit. Opec oil ministers are expected to meet during the event.