'Politics' behind high oil: OPEC head<\/p>\n
Associated Press, Sydney<\/p>\n
OPEC president Purnomo Yusgiantoro blamed a \"political
\npremium\" of US$10-$15 a barrel for soaring oil prices on
\nWednesday, saying the oil cartel is exceeding its supply quotas
\nbut the market is not responding.<\/p>\n
Purnomo said OPEC was concerned about the high oil prices but
\nexceptional circumstances restricted its room to maneuver on the
\nissue.<\/p>\n
\"According to our view based on the fundamentals -- supply and
\ndemand values -- the price should not be as high as what we see
\ntoday,\" he told reporters at the 19th World Energy Congress in
\nSydney.<\/p>\n
\"What we see is a political premium between $10-$15 per
\nbarrel.\"<\/p>\n
Purnomo, who is also Indonesia's Energy Minister, cited market
\nspeculation and geo-political factors including unrest in the
\nIraqi city of Najaf and Russian government action against the
\ncountry's largest oil producer Yukos, for the high oil price.<\/p>\n
He expects prices to fall from current levels of more than $40
\nby the end of the year, based on contracts exchanged on oil
\nfutures markets.<\/p>\n
Asked to speculate on how much the price could fall he
\nreplied: \"Boy ... $5 a barrel?\"<\/p>\n
In Asian trade Wednesday, oil prices continued to weaken as
\nconcerns over the possible impact of Hurricane Frances on the
\nsouthern U.S. states which are home to major oil production and
\nrefinery facilities faded.<\/p>\n
In early afternoon deals, New York's reference contract, light
\nsweet crude for October delivery was at $43.22 a barrel, down
\nfrom the $43.31 close Tuesday.<\/p>\n
Purnomo also said the Organization of Petroleum Exporting
\nCountries was likely to change its target band of $22 to $28 a
\nbarrel at a meeting in Vienna on Sept. 15.<\/p>\n
He refused to comment on where the revised band might be set
\nbut said it would reflect the impact of inflation and
\ndepreciation of the U.S. dollar since the current target band was
\nset in 2000.<\/p>\n
Purnomo previously told reporters at the congress that the
\nOPEC target band could be set at $26 to $34.<\/p>\n
He was non-committal on whether this month's OPEC meeting
\nwould authorize an increase in oil supply to force down prices,
\nsaying world supply was already exceeding demand by 2.7 million
\nbarrels a day.<\/p>\n
\"We will see after we have updated our figures,\" he said
\n\"There is a monitoring committee that will be reporting to us the
\nday before the conference ... I have no information from them
\nyet.\"<\/p>\n
OPEC represents 11 countries -- Algeria, Indonesia, Iran,
\nIraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United
\nArab Emirates and Venezuela.<\/p>\n
Purnomo said the cartel's quota was 26 million barrels a day
\nbut it was currently pumping almost 30 million barrels, although
\nhe conceded the two million barrels a day from Iraq fluctuated
\naccording to the security situation.<\/p>\n
He expected Iraq to contribute a stable three million barrels
\na day after planned elections early next year.<\/p>\n
The United Arab Emirates and Qatar have already said OPEC
\nshould increase its target price band at the Vienna meeting.<\/p>",
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