oil related 111107

Saudi oil minister: Gulf producers do not control crude prices

Sunday, November 11, 2007

KUWAIT CITY: Saudi Arabia's oil minister said Sunday that Gulf producers could not control record crude prices but would continue their attempts to ensure adequate supplies.

Oil prices have surged near US$100 per barrel recently amid concerns about supplies, the weak U.S. dollar and OPEC's apparent reluctance to pump more crude into the market.

"Gulf countries do not control prices but they try as much as possible to secure supplies and market security," Saudi Oil Minister Ali al-Naimi told reporters at the end of a brief visit to Kuwait.

Some analysts believe prices have far outpaced levels justified by supply and demand. They blame market speculators for pushing crude prices to record levels and predict that a sharp decline is imminent.

Others believe rising demand from developing countries like China and India will keep prices at historically elevated levels.

Al-Naimi refused to say whether the Organization of Petroleum Exporting Countries, or OPEC, would boost production to curb prices, calling such speculation "premature."

"When we meet in OPEC, we will discuss the matter," added al-Naimi, the senior oil official in Saudi Arabia, the world's largest exporter of crude.

It was unclear if he meant the Dec. 5 meeting of OPEC oil ministers in the United Arab Emirates, or the gathering of the member countries' leaders Nov. 17-18 in Saudi Arabia.

Kuwait's acting oil minister, Mohammed al-Eleim, told reporters that if there is a need for increased oil production, "OPEC will not hesitate to fulfill its responsibilities." He said the organization was currently analyzing the reasons behind rising prices.

In October, OPEC ministers agreed to boost production by 500,000 barrels a day effective at the beginning of this month, but the move seemed to have little effect on prices.

Oil prices surged to a record US$98 per barrel on Wednesday before moderating slightly to close near US$96 at the end of the week.

Source: IHT