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Bloomberg: Oil Rises as OPEC Ministers Downplay Possible Production Boost

By Grant Smith and Alexander Kwiatkowski

Nov. 28 (Bloomberg) — Crude oil rose in New York trading as OPEC ministers countered reports the group is planning to raise production at a meeting next week.

The Organization of Petroleum Exporting Countries currently has no plan to raise oil output when it meets next week in Abu Dhabi because the market is well supplied, Qatar’s oil minister said today. Libya’s top oil official said the group is unable to increase production any further.

“I have not been informed of any plan,” Qatar’s Abdullah bin Hamad al-Attiyah said in a telephone interview today. “It seems to be that the market has reacted to physical supply as it has already dropped at the beginning of winter time.”

Crude oil for January delivery rose as much as 62 cents, or 0.7 percent, to $95.04 a barrel on the New York Mercantile Exchange. The contract was at $95.01 at 2:01 p.m. in London. Yesterday, the contract fell $3.28, or 3.4 percent, to $94.42, the biggest decline since Nov. 13.

“I don’t think that there is a big room to increase output because OPEC is meeting demand,” Libya’s top oil official, Shokri Ghanem, said in a telephone interview today from Tripoli. “OPEC is selling to anybody who wants to buy, it is doing all it can.”

Crude-oil stockpiles probably fell 1 million barrels in the week ended Nov. 23, according to the median of responses by 17 analysts surveyed by Bloomberg News before the release of an Energy Department report at 10:30 a.m. today in Washington.

Brent crude oil for January settlement rose as much as 57 cents or 0.62 percent to $93.09 a barrel on the London-based ICE Futures Europe exchange amid reports of a strike in Nigeria, Africa’s biggest producer. Brent was at $93.00 at 1:51 p.m. London time.

Nigerian Strike

Nigerian oil-worker union Nupeng plans to call a nationwide strike next week unless a dispute in the country’s liquefied natural gas industry is resolved, Platts reported.

OPEC will meet in Abu Dhabi on Dec. 5 to review production levels for the first quarter of 2008. The group agreed on Sept. 11 in Vienna that the 10 members of the group with production targets, all except Angola and Iraq, would increase output by 500,000 barrels a day to 27.253 million barrels starting Nov. 1.

OPEC is considering a 750,000 barrel-a-day increase because of concern that higher oil prices will slow the U.S. economy, Dow Jones Newswires reported, citing an OPEC delegate it didn’t identify.

Saudi Arabia, OPEC’s biggest exporter, will expand its spare capacity 22 percent in December to 2.8 million barrels a day, and is already pumping 9 million barrels a day, Saudi Oil Minister Ali al-Naimi told reporters in Singapore today.

“There’s obvious weakness in the U.S. economy, and OPEC itself is more inclined than perhaps it was to increase production,” said David Dugdale, a London-based energy analyst at MFC Global Investment Management. “These two factors are stopping oil getting to $100.”

To contact the reporters on this story: Grant Smith in London at [email protected] Alexander Kwiatkowski in London at [email protected]

Last Updated: November 28, 2007 09:03 EST

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1 Comment on “Bloomberg: Oil Rises as OPEC Ministers Downplay Possible Production Boost”

  1. #1 Ivo Cerckel
    on Nov 28th, 2007 at 19:49

    What happened to the announcement by the OPEC heads of state, accompanied by their oil ministers, at the OPEC Summit on November 17 and 18, 2007 in Riyadh, Saudi Arabia, that their FINANCE MINISTERS would meet BEFORE December 5 to discuss the sliding dollar’s impact on their economies after Iran and Venezuela proposed OPEC stop pricing oil in dollar? Could it be that that meeting of OPEC finance ministers will be held on December 3 and 4 on the sidelines of the Gulf Co-operation Council (GCC) meeting in Doha, Qatar? December 5 being the date of the meeting of OPEC oil ministers in Abu Dhabi, United Arab Emirates (U.A.E.)? ArabianBusiness.com having reported on Wednesday that the U.A.E. might revalue its currency against the dollar as early as this Sunday, December 2.
    http://bphouse.com/blaze/honest_money/2007/11/27/oil-for-gold/

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