Kuwait Times
The first daily in the Arabian Gulf
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Oil market oversupplied: Qatar
MADRID: Oil markets are oversupplied but it would not be wise for any OPEC exporter to tighten the taps given the risk of exacerbating prices, Qatari Oil Minister Abdullah Al-Attiyah said yesterday. Attiyah's remarks came after Libya's most senior oil official said on Thursday he was studying the possibility of reducing output in response to a US threat to sue OPEC members, although he said the North African country had no concrete plans to do so for now. "It is not wise today to cut supplies even though t
here is a surplus because we do not want to create a psychological problem," Attiyah told Reuters. "I'm not in favor of it at all. We want to try to help to ease the psychological heat.
But the Qatari minister criticized a move by US politicians to sue the Organization of the Oil Exporting Countries if the oil club did not pump an amount of oil that Washington sees sufficient. "The Congress should look to increase exploration inside the United States," Attiyah said. "It is strange to ask what I should produce. It's an issue of sovereignty." The US House of Representatives has passed a bill allowing the Justice Department to sue OPEC members for limiting oil supplies and working together t
o set crude prices. The Senate has yet to vote on it and the White House has said it would veto the bill.
Attiyah said if enacted, the measure could create a problem for the US market as many producers would avoid US buyers. "You will see a lot of oil suppliers will avoid the American market and you will create another big problem." OPEC's biggest exporter Saudi Arabia has announced plans to hike output to 9.7 million barrels per day (bpd) - the fastest pace in decades-but some consumer economies blame the oil exporter group for doing too little to combat the rally.
Oil producers have to consider their reservoirs' productivity for the long run and not only supply and demand factors as they manage production levels, said Attiyah. "Sometimes I have to think carefully in terms of reservoir management. I do not want to damage all the reservoirs. We produce to satisfy the whole world but not at the cost of our reserves," he said. Record oil prices are putting pressure on the global economy, saddling companies and consumers around the world with higher energy costs and trig
gering protests from farmers in Spain to students in Nepal.
Meanwhile, a week after failing to deflate record oil prices at a summit in Saudi Arabia, the world's biggest crude producers and consumers will get another chance to tackle the problem at a meeting this week. More than 3,000 delegates, including leading corporate and political figures, are to meet at the 19th World Petroleum Congress (WPC) in Madrid, which runs from today to Thursday after an official opening reception yesterday. "It's the Olympics of the oil and gas industry," director of the WPC, Pierce
Riemer, told a press conference last week.
The gathering follows a surge in oil prices Friday that took both New York light sweet crude and Brent North Sea crude to record levels beyond 142 dollars a barrel. The president of the Organization of Petroleum Exporting Countries, the head of the International Energy Agency and ministers from Nigeria, Russia, Venezuela, India, France and the Netherlands are expected to be present. They are to be joined by the bosses of major international oil groups ExxonMobil of the United States, CNOOC of China, Britai
n's BP and Shell, Rosneft of Russia and Total of France.
Saudi Arabia convened a hastily arranged meeting of consumers and producers in Jeddah last weekend to tackle the problem of record oil prices, which are forecast by OPEC's president to touch 150-170 in the coming months. Most experts agreed afterwards that the only concrete result was Saudi Arabia's announcement that it would increase daily production by more than 200,000 barrels to 9.7 million-and that it could significantly step this up if necessary. The gathering pitted consumer nations, which are calli
ng for an increase in production, against producers. Most OPEC members remain firmly against any increase in their production and blame speculators and the fall in the dollar for the remarkable run up in prices, which have doubled in the last 12 months. - Agencies
here is a surplus because we do not want to create a psychological problem," Attiyah told Reuters. "I'm not in favor of it at all. We want to try to help to ease the psychological heat.
But the Qatari minister criticized a move by US politicians to sue the Organization of the Oil Exporting Countries if the oil club did not pump an amount of oil that Washington sees sufficient. "The Congress should look to increase exploration inside the United States," Attiyah said. "It is strange to ask what I should produce. It's an issue of sovereignty." The US House of Representatives has passed a bill allowing the Justice Department to sue OPEC members for limiting oil supplies and working together t
o set crude prices. The Senate has yet to vote on it and the White House has said it would veto the bill.
Attiyah said if enacted, the measure could create a problem for the US market as many producers would avoid US buyers. "You will see a lot of oil suppliers will avoid the American market and you will create another big problem." OPEC's biggest exporter Saudi Arabia has announced plans to hike output to 9.7 million barrels per day (bpd) - the fastest pace in decades-but some consumer economies blame the oil exporter group for doing too little to combat the rally.
Oil producers have to consider their reservoirs' productivity for the long run and not only supply and demand factors as they manage production levels, said Attiyah. "Sometimes I have to think carefully in terms of reservoir management. I do not want to damage all the reservoirs. We produce to satisfy the whole world but not at the cost of our reserves," he said. Record oil prices are putting pressure on the global economy, saddling companies and consumers around the world with higher energy costs and trig
gering protests from farmers in Spain to students in Nepal.
Meanwhile, a week after failing to deflate record oil prices at a summit in Saudi Arabia, the world's biggest crude producers and consumers will get another chance to tackle the problem at a meeting this week. More than 3,000 delegates, including leading corporate and political figures, are to meet at the 19th World Petroleum Congress (WPC) in Madrid, which runs from today to Thursday after an official opening reception yesterday. "It's the Olympics of the oil and gas industry," director of the WPC, Pierce
Riemer, told a press conference last week.
The gathering follows a surge in oil prices Friday that took both New York light sweet crude and Brent North Sea crude to record levels beyond 142 dollars a barrel. The president of the Organization of Petroleum Exporting Countries, the head of the International Energy Agency and ministers from Nigeria, Russia, Venezuela, India, France and the Netherlands are expected to be present. They are to be joined by the bosses of major international oil groups ExxonMobil of the United States, CNOOC of China, Britai
n's BP and Shell, Rosneft of Russia and Total of France.
Saudi Arabia convened a hastily arranged meeting of consumers and producers in Jeddah last weekend to tackle the problem of record oil prices, which are forecast by OPEC's president to touch 150-170 in the coming months. Most experts agreed afterwards that the only concrete result was Saudi Arabia's announcement that it would increase daily production by more than 200,000 barrels to 9.7 million-and that it could significantly step this up if necessary. The gathering pitted consumer nations, which are calli
ng for an increase in production, against producers. Most OPEC members remain firmly against any increase in their production and blame speculators and the fall in the dollar for the remarkable run up in prices, which have doubled in the last 12 months. - Agencies
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