OPEC members worked Tuesday to reach consensus to maintain its official output quota at a meeting here as Venezuela joined cartel president Iran in urging Gulf countries to cut their excess supplies.
Ahead of Wednesday’s OPEC meeting, the cartel’s president Iran said the Organization of Petroleum Exporting Countries would reach consensus over its latest output decision.
Kuwait Oil Minister Mohammad al-Baseeri said OPEC would likely keep its official production quota unchanged as the market was balanced and prices stable.
The 12-nation cartel must decide whether to change its oil production levels in the face of heightened Iran tensions, higher Libyan output and a weak economic outlook.
Analysts widely expect the Vienna-based organisation, which supplies a third of the world’s crude, to maintain its official output target of 24.84 million barrels per day — where it has stood for three years.
The International Energy Agency, which represents major oil consuming countries, said on Tuesday that OPEC in fact produced 30.68 mbpd last month, mainly because of higher output from Saudi Arabia and Libya.
The figure includes output from Iraq, which is not part of OPEC’s official output quota because of unrest in the country.
Excluding production from Iraq, the IEA estimated that the cartel pumped out 27.97 mbpd of oil in November — is still above the OPEC ceiling.
Speaking on the eve of Wednesday’s meeting, Venezuela oil minister Rafael Ramirez told reporters that while Saudi Arabia and Kuwait “must accommodate” higher Libyan output by cutting their excess supplies, OPEC should “maintain the same level of (official) production.”
He said “the Gulf countries have to reduce” their production, adding: “We believe there is enough oil in the market.”
Iran’s oil minister Rostam Qasemi said: “We will have the meeting, and then we will decide” what to do regarding output quotas.
“Whatever the decision will be, it will be made all together,” he added.
On Sunday, Qasemi renewed calls for OPEC kingpin Saudi Arabia and Kuwait to ease back their above-quota production as Libyan oil comes back onto the market.
The two Gulf states boosted production to compensate for the suspension of Libyan oil exports after the North African country’s descent into civil war this year.
Saudi Oil Minister Ali al-Naimi said on Monday that he was happy with the kingdom’s own crude output level of more than 10 mbpd to meet demand coming “from all over” the world.
But the IEA noted on Tuesday that the eurozone debt crisis was hitting oil demand growth while OPEC lowered slightly its own world demand forecast for 2012.
The organisation said world oil demand next year would reach 88.87 mbpd, revising downwards its previous forecast of 89.01 mbpd.
“The adjustment reflects slowing growth in the OECD, which is expected to have spillover effects for China and India, and hence impact oil consumption over the coming year,” it said.
Oil prices meanwhile were higher, with New York’s main contract, light sweet crude for January, up a sharp $2.39 at $100.16 in afternoon trade.
OPEC Secretary General Abdullah El-Badri last week said that current oil prices were “satisfactory,” adding that supply was adequate. The IEA said on Tuesday that prices were winning support from likely sanctions against Iran.
The cartel meets periodically to set production levels, hoping that its decisions result in fair oil prices for consumers and its dozen members, which also include Algeria, Libya and Nigeria.