OPEC ministers signal output to remain on hold

Last Updated: Tuesday, June 10, 2014 - 22:43

OPEC ministers signal output to remain on hold
Vienna: All is not well within OPEC as the oil cartel focuses on how much crude to pump for the rest of the year.

Kurds in Iraq are defying the central government and selling their oil directly abroad. Nigeria is hurting due to shale oil production in the United States, its most important customer.

While worrisome for the two countries, such problems may help global supplies. But there is trouble in production, as well. Sales from Iran, normally second only to Saudi Arabia, are severely crimped by sanctions. And internal conflicts and domestic chaos have slashed Libya`s exports.

The upshot is that OPEC oil ministers are likely to keep their production targets unchanged at their meeting tomorrow.

While the International Energy Agency, oil consultant to major consuming countries, sees demand rising for the rest of the year, many of the 12 OPEC members are at their production capacity limits.

Once again, that will leave it to OPEC powerhouse Saudi Arabia to make up for any shortage. The kingdom is now pumping less than 10 million barrels a day. But Saudi oil minister Ali Naimi said last month its total capacity is above a daily 12 million barrels.

OPEC sets official output goals on total production by its members.

With many members producing near their limits, however, Angolan oil minister Jose Maria Botelho de Vasconcelos today said that the meeting could decide to extend the present target of 30 million barrels a day. That would allow the Saudis to adjust their production according to world market needs.

"I am confident that Saudi Arabia will, as always, discretely increase production to cover any losses from the shortfalls of others," said John Hall, chairman of the analysis group Alfa Energy.

AP

First Published: Tuesday, June 10, 2014 - 22:43

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