Qatar says Opec could cut supply as inventories grow

Qatar says Opec could cut supply as inventories grow Bloomberg Published: January 31, 2008, 01:28

Doha: The Organisation of Petroleum Exporting Countries (Opec) won't raise output quotas at a meeting this week and will consider a supply reduction in the future because world econ-omic growth is slowing and oil inventories are ample, Qatar's energy minister said.

"The world has sufficient supply, even oversupplied in some places,'' Qatar's Abdullah Bin Hamad Al Attiyah said yesterday. "So to increase, I don't think this is on the agenda.''

He said the 13-member producer group, the supplier of more than 40 per cent of the world's oil, would consider a production cutback "if the world economy moves toward a recession.'' Weaker economies may lead to reduced demand for energy, he said.

The Opec is expected to keep its output target unchanged at 29.67 million barrels a day when it meets in Vienna on February 1, according to 29 of 32 analysts surveyed by Bloom-berg News.

UAE Energy Minister Mohammad Bin Dha'en Al Hamili said yesterday he was concerned about the possible knock-on effects of the US mortgage crisis on the world economy and oil markets.

Al Hamili said Opec was monitoring the impact on crude oil demand of a possible slowdown in the global economy and would discuss the matter.

A senior Iranian oil official also made clear yesterday he did not expect Opec to decide to change output levels at the meeting. "Because no special conditions have been created in oil markets, it is unlikely that Opec will make a special decision in its meeting on Friday," Javad Yarjani, head of Opec affairs at Iran's oil ministry, said. "Market conditions do not need a new Opec decision."

Oil prices have tumbled from a record $100.09 a barrel set on January 3 amid signs of an economic slowdown in the US, the world's biggest energy consumer.

Crude oil for March delivery was up 45 cents at $92.09 a barrel in electronic trading on the New York Mercantile Exchange ay 9.28am London time.