Analysts have said oil producing countries are likely to raise output after crude rallied more than 30 percent from a low in May because they fear prices could damage economic growth in fuel importing countries.
Saudi Arabia’s Ali Al Naimi, said on Friday he was still happy with an oil price of $70-80 a barrel and there was no need for an extra OPEC meeting before the next scheduled one in June.
Others in the group have been pressing for a higher price, arguing that quantitive easing and a weakened US dollar that spurred gains across financial markets mean the oil price strength is partly nominal.
Egyptian Oil Minister Sameh Fahmy said the current increase in oil prices was the result of higher demand on heating fuel because of the cold weather in Europe.
United Arab Emirates Energy Minister Mohammed bin Dha’en Al Hamili said crude oil inventories are “quite high. It’s the highest over the five years average... The market is well supplied”.
European benchmark ICE Brent crude for February closed at $93.46 on Friday after hitting $94.74 a barrel, its highest level since October 2008.
Arab oil exporters meeting in Cairo this weekend said they saw no need to supply more crude as stocks were high and prices had been inflated temporarily by cold weather in Europe.
Asked by Reuters if the world economy could stand a $100 oil price, Kuwaiti Oil Minister Shaikh Ahmad Al Abdullah Al Sabah said: “Yes it can”.
Iraq’s new oil minister and the head of Libya’s National Oil Corporation both told Reuters that $100 was a fair price, while Qatar’s Minister Abdullah Al Attiyah said he did not expect OPEC to increase production in 2011. “I do not expect an OPEC meeting before June because oil prices are stable,” he said.
Some delegates even called for exporters to comply better with agreed production limits. OPEC members’ compliance with promised cutbacks reached 56 per cent in November, according to Reuters estimates.
When asked if output could be raised, Kuwait’s Shaikh Ahmad said: “No. More compliance, more compliance”.
The Cairo meeting of the Organisation of Arab Exporting Countries (OAPEC) brought together Arab members of OPEC including top exporter Saudi Arabia, which has traditionally been viewed as a price moderate, as well as non-OPEC countries Tunisia, Egypt, Syria and Bahrain.
OPEC cut output drastically after the global financial crisis struck in 2008 to prop up collapsing oil prices.
As demand has risen steeply in 2010 and is expected to rise further in 2011, the market is watching closely whether OPEC can release at least some of its spare capacity to prevent prices from soaring to around $150 per barrel as they did before the crisis struck in summer 2008.
Brent crude and US West Texas Intermediate (WTI) prices slid to eight-month lows on Monday, last trading around $85 and $78, respectively
While global growth this year was still expected at three per cent, it is now projected to slow to 2.2 per cent in 2023, revised down from a forecast in June of 2.8 per cent
In the OECD guidelines, five TP methods have been proposed to assess the arm-length price, which can be categorised into traditional transaction methods, and transactional profit methods
Adnoc to provide liquefied natural gas to the country by late 2022 as part of agreement
On offer is about 550.7 million shares, representing 11 per cent of the company, according to the issued prospectus.