VIENNA, 5 December 2003 — OPEC oil producers agreed yesterday to keep tight oil supplies on hold for the northern winter and move aggressively to shore up high prices early next year.
The Organization of the Petroleum Exporting Countries left output limits unchanged at 24.5 million barrels a day and will meet again on Feb. 10 in Algiers, UAE Oil Minister Obaid ibn Saif Al-Nasseri said.
Ministers also scheduled talks for March 31 in Vienna and June 3 in Beirut to leave international crude markets in no doubt about their intention to keep a tight rein on prices. “The message from OPEC is that it is still managing the oil market very well,” said Oystein Berentsen, head of international crude trading at Norway’s Statoil.
The deal saw oil prices initially dip 50 cents and then recover sharply as traders digested the prospect of cuts to come. US crude at 1700 GMT was up 24 cents at $31.34 a barrel. “Any downside move on price is likely to be limited. They can manage to support $30 US crude if they want to,” said Berentsen.
Saudi Minister of Petroleum and Mineral Resources Ali Al-Naimi gave little hope to consumer nations that OPEC’s grip on tight world inventories might loosen. “Inventories are as good as any now, they could be lower with no serious concern,” the minister said. “Inventories are less important to commercial buyers, they don’t need to carry so much, they know the oil is there.”
The group that controls half the world’s oil trade says it expects to cut deliveries in February to support prices at $30 for a US barrel.
Ministers already appear to have a consensus on the need for tougher restraints when they meet in February as demand eases after the northern winter and to make room for the recovery in post-war Iraqi exports.
