The oil market is stable and supply shortages can be covered, so the Organization of Petroleum Exporting Countries has no reason to change its production levels, according to Saudi Arabia’s oil minister.
OPEC’s current output of about 30 million barrels a day is the right level and global oil demand is “great,” Ali Al-Naimi told reporters in Seoul today. Saudi Arabia, the biggest producer in the 12-member group, is pumping about 9.6 million barrels a day and has 12.5 million of capacity, he said.
Oil at about $100 a barrel is a “fair price for all,” said Al-Naimi, who is attending ministerial meetings on clean energy in South Korea’s capital. Brent futures are above $108 in London today, rising for the first time in three days amid concern that the crisis in Ukraine may disrupt energy supplies from Russia. West Texas Intermediate, the U.S. benchmark crude, was near $100 in electronic trading in New York.
OPEC, which is responsible for about 40% of the world’s crude supply, produced 29.9 million barrels a day in April, the least since June 2011, a Bloomberg survey of producers and analysts show. Saudi Arabia’s output fell by 100,000 barrels a day from March on reduced demand from power generation and as refineries shut for maintenance, while a pipeline linking Iraqi oil fields to the port of Ceyhan in Turkey has been closed because of attacks.
Production from Libya, the holder of Africa’s largest crude reserves, has dropped more than 80 percent since the start of the uprising against Muammar Qaddafi in 2011. Supply from what is now OPEC’s smallest producer has fallen to 235,000 barrels a day as shutdowns at fields operated by Sirte Oil Co. continued, according to state-run National Oil Corp.
Shut Libyan production must come back quickly, OPEC Secretary General Abdalla El-Badri said in separate comments posted on the International Energy Forum’s website.
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