Fin24

Oil rises as Opec talks break down

2011-06-08 16:09

Vienna - Talks among Oil Producing and Exporting Countries (Opec) broke down in acrimony on Wednesday without an agreement to raise output after Saudi Arabia failed to convince the cartel to lift production.

“Unfortunately we are unable to reach a consensus to reduce or raise production,” Opec secretary general Abdullah El-Badri told reporters.

“This is one of the the worst meetings we have ever had,” said Saudi Oil Minister Ali al-Naimi.

Naimi said six countries in the 12-member group were opposed to an increase in output.

He said Gulf Arab countries had proposed an increase to 30.3 million barrels per day (bpd), compared to current supply of about 29 million bpd, including Iraq which is not bound by an Opec quota.
 
Next meeting not until December

El-Badri said the effective decision was no change in policy, but that he hoped Opec would meet again in three months' time. Naimi said the next meeting would be on December 14.
 
The failure to reach an agreement will be a blow for industrialised consumer countries hoping Opec would take action to stem fuel inflation.

Brent crude rose $1.64 a barrel to $118.42.
 
No date has been set for another meeting.
 
Gulf Arab delegates said Iran, Venezuela and Algeria were among those to refuse to consider an output increase. Non-Gulf delegates said Saudi Arabia had proposed an increase on top of April supplies that was too high for them to contemplate.

Naimi said Saudi Arabia was committed to supplying market needs. Earlier in the week a Gulf official said the country was already raising output by at least 500 000 bpd in June to 9.5 to 9.7 million bpd.

Saudi Arabia's output was last as high in the middle of 2008 after oil prices set a record $147 a barrel, shortly before the recession sent prices crashing.
 
Forecasts suggest more oil is required to stop oil prices rising again. Opec’s Vienna secretariat sees demand in the second half of the year at 1.7 million bpd higher than current cartel output.

Comments
  • Paul - 2011-06-09 09:18

    To Fin24 Editor ...WTF ...is Oil the only comodity in The World or are you a Saudi ???

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