Opec's president said on Monday he will begin consultations with other cartel ministers from Friday to release an additional 500,000 barrels per day of Opec crude if oil prices remain high.
"If prices will continue to increase as it is now, by the end of this week...I will start consultation with my colleagues to release the 500,000 bpd," Sheikh Ahmad al-Fahd al-Sabah of Kuwait told reporters at parliament. Oil prices struck record highs on Monday, with US crude hitting a peak of $59.23 a barrel.
Opec agreed at is meeting last week to raise its formal production quotas by 500,000 barrels per day to 28 million bpd, roughly matching its current actual output, and promised another 500,000 bpd increase within a matter of weeks should prices stay high.
Most in Opec are already pumping at full capacity and Sheikh Ahmad said last week that any further increase could only be supplied by Saudi Arabia, the UAE and perhaps Kuwait itself.
Saudi Arabian Oil Minister Ali al-Naimi, who controls the bulk of spare Opec capacity, has said the kingdom is able to lift output, but that at present there is no demand for extra crude from the world market.
Instead he, and others in Opec, see refinery bottlenecks driving up prices by creating shortages of oil products - particularly diesel, jet fuel and heating oil.
Demand for crude, rather than price movement, should be the trigger for extra supply, Naimi has said.
Opec's communique for its June 15 meeting gave no specifics on what oil price could trigger extra barrels.
Asked if Saudi Arabia has told him it is prepared to increase its output from the current 9.5 million bpd, the Opec chief said:
"All the members of Opec are ready. Whenever there will be a demand the market will be well supplied."
"We will continue to secure the supply to the market whenever there will be a demand," he added.
But he said his information showed there was no increase in demand and prices were high due to market psychology.
"The market is well supplied and we believe in the third quarter there will be over one million (bpd) extra in the market," the Opec president said.
Sheikh Ahmad said the current actual production from the Opec, including Iraq which is not subject to quotas, is 30.3 million bpd.
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