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Politics : Rat's Nest - Chronicles of Collapse -- Ignore unavailable to you. Want to Upgrade?

To: Wharf Rat who wrote (344)	6/14/2005 11:37:38 AM
From: Wharf Rat	Respond to of 24225

OPEC running out of ammunition to tackle oil spike Reuters VIENNA — OPEC appears set to keep physical oil supplies unchanged, despite a plan to increase output quota limits aimed at easing crude from $55 a barrel. OPEC’s inability to tackle high prices was underlined today by the oil minister for its leading producer Saudi Arabia, in remarks that will do little to lower the temperature on heated world oil markets. US crude traded off 30 cents at $55,32 after a $2 leap yesterday. Saudi Oil Minister Ali-al Naimi said Riyadh had informed its customers of export allocations for July that mean keeping output steady at 9,5 million barrels a day. Naimi explained that Saudi, the only producer with spare capacity, was comfortably meeting demand. For the time being it cannot sell more crude. Others in OPEC are at full stretch. "There is certainly not a shortage of supply, there is absolutely no shortage," Naimi told reporters ahead of tomorrow's meeting of the Organisation of the Petroleum Exporting Countries. OPEC is at full capacity bar some Saudi volume of heavy, high-sulphur crude that needs advanced refinery technology to meet Western environmental regulations. A shortage of that type of refinery capacity has squeezed global supplies of refined products known as middle distillates — diesel, heating oil and jet fuel. "Middle distillates are in short supply as a result of the refinery configuration," said Naimi. "Governments and companies must be convinced to build, build, build refineries." OPEC ministers are considering lifting output quotas by 500 000 barrels a day, 2%, to 28 million bpd. Naimi said Saudi backs the move. But even OPEC’s President Sheikh Ahmad al-Fahd al-Sabah, admits it would be little more than a gesture to consumer countries, worried that oil prices are an increasingly difficult impediment to world economic groth. "Just symbolic," was Sheikh Ahmad’s assessment of the planned policy change. Actual OPEC output for 10 members with quotas is already close to 28 million bpd so very little, if any, new crude is expected to reach the market. Sheikh Ahmad may also be given discretionary power to raise output limits further before OPEC meets again in September, on top of the immediate 500 000-barrel-a-day increase. Nigerian Presidential Adviser on Petroleum Edmund Daukoru said Sheikh Ahmad might be asked to lift output again should prices stay high. "Above $55 is definitely uncomfortable," he said. businessday.co.za