Opec chief Abdallah al-Badri on Wednesday rejected US calls for increased oil output to cool record prices, saying the market is already well supplied. But the oil cartel's secretary general said a final decision would be made by Opec ministers at a meeting in Abu Dhabi next month, as prices dropped from highs near 100 dollars a barrel.
"At this time, frankly we don't see that we need to add more oil in the market," Badri told a press conference in Riyadh ahead of a rare weekend Opec summit to discuss long-term oil supplies.
"There is a plenty of oil in the market. There is no shortage of oil," Badri said in response to a question about a decline in US and Japanese oil inventories in the past few weeks and calls by Washington to raise output.
Badri, a Libyan official, said however that a final decision on production will be taken by Opec ministers when they meet in Abu Dhabi on December 5. "We (Opec) will show our figures to our ministers in Abu Dhabi. It's up to them to decide," he said.
He said oil inventories were still at the average level of the past five years and were sufficient for 53.5 days, a margin considered fairly safe. US Energy Secretary Samuel Bodman on Tuesday called on Opec, which supplies 40 percent of the world's oil, to help cool record prices by raising output.
"I do believe there is a lack of willingness to supply the market... It is contributing to the price environment," he told reporters on the sidelines of an energy conference in Rome.
The Opec chief said the cartel will not allow any shortage of supply to occur and called on the United States to help in resolving its refinery bottlenecks which are contributing to the price hike.
"We don't want to see any shortage in supply... If there is a shortage, we will watch it and we want to see if we can satisfy this shortage," said Badri, adding that Opec does not favour a high price for oil.
He said Opec members are investing 150 billion dollars on 120 projects to raise their capacity by five million barrels a day in 2015. The 12-member cartel plans to increase its capacity by 19 million barrels in 2030, he said.
Oil prices rose sharply to close to 100 dollars a barrel last week over concerns of tight supplies, geopolitical tensions and a decline in US oil inventories. Prices however lost some ground on Tuesday after the International Energy Agency (IEA) lowered its global demand forecast for crude for the fourth quarter this year.
The IEA, the energy policy advisor to major developed countries, cited weaker economic activity in the United States and pointed to an increase of 410,000 barrels per day in Opec output in October. In its monthly oil report, the IEA noted "strong indications that high prices are depressing demand."
But the IEA cautioned that despite its downward fourth quarter demand revision, "supplies are likely to remain constrained through to the end of the year."
This assessment contrasted with comments by Opec kingpin Saudi Arabia's oil minister, who said fears about a shortage of supplies were groundless and there was no reason for them to push prices to current levels. World oil traded higher in Asia on Wednesday, rebounding from heavy falls sparked by the lower demand forecasts. In afternoon trade, New York's main futures contract, light sweet crude for December delivery, was 26 cents higher at 91.43 dollars per barrel.
The contract had slumped 3.45 dollars to close down at 91.17 dollars per barrel in New York trade on Tuesday, well below a historic peak of 98.62 dollars reached last week.