Opec Boss Rounds on Oil Speculators

25/01/2003| IslamWeb

The head of oil producers' cartel Opec has rounded on speculators who have played on fears of war with Iraq to profit from a rise in crude prices.Abdulla Al-Attiyah said the recent rise in oil prices to more than 30 dlrs a barrel was based on
misplaced concerns of an oil supply squeeze. "There is no shortage of oil," Mr Al-Attiyah, Opec president, told a meeting of world leaders.

Profits

Even if the US did attack Iraq, experience of previous conflicts showed that Opec members would be able to meet demand.

"Always in the Gulf, including the Iran-Iraq war, has the most efficiency in supply, and there has never been a delay to cargos," Mr Al-Attiyah said, adding that he would prefer an oil price of 25 dlrs a barrel.

Speculation, rather than "reality", had played a strong hand in the current strength of crude prices.

"We will see a lot of people making profits in the name of supply," he said.

The comments came at the start of the third day of the World Economic Forum's annual summit, in Davos, which has been overshadowed by the threat of US-led war against Iraq, and its impact on the global economy.

US Secretary of State Colin Powell, who arrived at Davos on Saturday, has said that the US has gained considerable support for any conflict.

Oil surplus?

Mr Al-Attiyah said that oil supplies were so strong that Opec might be considering an oil cut at its 11 March meeting.

"[We] will face a large surplus in the oil market," he said.

A ring round had revealed that crude buyers were not facing supply problems - an observation backed by Saudi Arabian Oil Minister Ali Al-Naimi.

"Every one of our customers is satisfied, not concerned about his supply," Mr Al-Naimi said.

He added: "There is no reason for prices to be where they are today."

Saudi Arabia had three million barrels a day in excess supply which could be brought on line, and whose existence he credited for keeping current prices below 40 dlrs a barrel, and saving the global economy 400m dlrs a day in oil costs.

"That's a very significant number to keep in mind," he said.

PHOTO CAPTION

President of the OPEC conference and Qatari Minister of Energy and Industry Abdullah bin Hamad Al Attiyah speaks during a news conference after an extraordinary meeting of ministers of the Organization of the Petroleum Exporting Countries (OPEC) at the OPEC's headquarters in Vienna, on Sunday, Jan. 12, 2003. OPEC members agreed to boost oil output target by 1.5 million barrels a day. (AP Photo/Ronald Zak)