4 May 2007 - 17:14
  • News Code: 103795

RIYADH – Oil producers cartel OPEC on Wednesday saw no need to increase output even as the International Energy Agency (IEA), the consumers watchdog, stressed the need to pump more crude.

"The market is stable. I think maybe in June we will review the market to see if we need more oil or not. But I don"t think we need it," Organisation of Petroleum Exporting Countries secretary general Abdullah el-Badri said.

 

"The market is stable and the supply and demand is stable," Badri told reporters on the sidelines of a meeting for Asian energy ministers when asked if OPEC needs to pump more crude to ease prices.

 

But IEA chief Claude Mandil warned there was a supply shortage which required producers to hike output.

 

"At present, there is a lack of crude because we see crude stocks not increasing whereas they should increase at this time of the year," Mandil said.

 

Mandil also called on oil producers to invest in the oil sector to increase spare production capacity which would eventually ease pressure on prices.

 

"We hope that in the medium term, there will be an increase in investments, both in upstream and downstream, which could ease the pressure on prices," he said.

 

"But we think part of the pressure on prices is the result of the lack of spare capacity," he added.

 

Badri, however, expected that oil projects will now take longer to complete because of sky-rocketing cost.

 

"We have not seen this kind of high cost in the past. Now I think they will not be shelved, but they will be delayed ... Instead of finishing them in three to four years, some of them will finish in six years, some in 10 years," he said.

 

Badri said that by 2030, OPEC will have to increase its production capacity by nine million barrels a day and that will require investments of between 230 and 500 billion US dollars.

 

He said OPEC is capable of supplying the world with enough oil for the next 80 years, but they need guarantees for demand.

 

"We have no problem (of ensuring the supplies). The problem is the security of demand," he said.

 

"Because really the concern of most OPEC countries is they don"t want to invest and keep that added capacity, because you have to spend to maintain that added capacity."

 

PIN/AFP

News Code 103795

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