Higher oil output not needed: Opec

20 Jan, 2008

Opec currently sees no need for an increase in oil output but is analysing the market every day, the organisation's Secretary General Abdullah al-Badri told German weekly magazine Der Spiegel in an interview.
"We're carefully analysing the market day in, day out. If we reach the conclusion the fundamental data warrant an increase in production, then our oil ministers will not hesitate to decree this," he told the magazine in comments published on Saturday. "But at present we see no need for this."
When asked if Opec had celebrated when crude oil prices first reached $100 per barrel earlier this year, Badri said: "No, why should we? We're interested in sensible prices. We want stability. It was a sole trader who miscalculated and lost money in the process," he added.
Badri was also asked if he thought the cost of a barrel of oil could reach $200 in the next 10 years, as had been forecast by Germany's Berlin-based DIW economic think tank. "The price of oil should essentially be determined by supply and demand, and if it does, then a jump to $200 is highly unlikely," he said, in comments that were published in German.
However, Badri said this could change if geopolitical issues, speculation, the depreciation of the dollar and bottlenecks in US oil processing gained the upper hand. "Under these circumstances, the price can reach any level," he said.
Opec, which holds its next extraordinary meeting in Vienna on February 1, had a "lively discussion" in November about switching to the euro from the dollar for oil trading, Badri said.
Oil producers Venezuela and Iran - both of which have had strained relations with Washington - have pressed for this. The Secretary General added that Opec still had spare capacity, and could raise output by 3.5 million barrels per day. Investment in new technology would raise Opec's extra capacity to 6 million barrels per day by 2012, he added.
Asked whether Opec would like Russia to join the organisation to increase its leverage on prices, Badri said: "We're not knocking on any doors." According to Reuters information, the interview was conducted on January 14.

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