DOHA: The Organization of the Petroleum Exporting Countries (Opec) has decided against cutting its oil output to lift prices, its president and Nigerian Oil Minister Emmanuel Ibe Kachikwu said following a meeting here yesterday.
Opec, whose members together pump out more than one third of world oil, is currently producing above its official target of 30 million barrels per day.
“Given the present position of the economy of countries that are purchasing (oil) and the worldwide economy, we will retain production at current levels,” said Kachikwu, who is minister of state for petroleum resources in Nigeria. Opec is currently pumping out around 32 million barrels of oil per day. The cartel yesterday published no figures on output in its communique, as it awaits increased output from Iran after sanctions were lifted on the Islamic republic.
“We cannot put a number now because Iran is coming, we don’t know when Iran will come, and we will have to accommodate Iran one way or the other,” said Opec Secretary General Abdalla el Badri.
“We decided to postpone this decision to the next OPEC meeting (in June) until the picture will be more clearer for us to decide on a number,” he added. Saudi Arabia yesterday repeated the kingdom’s stance that it would be willing to cut as long as non-Opec also reduces its output.
“We have said on more than one occasion that we are willing to cooperate with anyone that will help balance the market… with us,” Saudi oil minister Ali al Naimi told reporters gathered at Opec headquarters in Vienna.
Opec’s poorer nations – notably Venezuela, Ecuador and Algeria-had led the calls for a cut to help boost prices and in turn their badly-hit revenues. “Everyone is concerned about… the prices, no one is happy,” said Iraq’s oil minister Adil Abd Al Mahdi.
Opec yesterday confirmed that Indonesia had returned to the cartel after a near seven-year absence, bringing the number of member countries to 13.
Meanwhile Reuters reported Opec could hold another meetingbefore June if oil prices continue to slide Emmanuel Ibe Kachikwu said yesterday. When asked if there would be a meeting before June 2 if prices continue to fall, Kachikwu said: “Yes, potentially yes. We did say that we’d watch prices.”
A final statement was issued with no mention of a new production ceiling, apparently allowing member countries to continue pumping oil at current rates into a market that has been oversupplied. Opec abandoned production quotas for individual members several years ago and most members have been producing as much as they want.
Iran has repeatedly said it would boost production by at least 1 million barrels per day when sanctions are lifted. Without curbs elsewhere, this would add to a global glut, as the world is currently consuming up to 2 million bpd less than it is producing.
