Global oil market at comfortable level, Saudi Arabia says

Global oil market at comfortable level, Saudi Arabia says

Agence France-Presse, Riyadh

Oil giant Saudi Arabia said on Saturday that global oil
inventories were at "very comfortable" levels with supply
exceeding demand, but was non-committal on what OPEC would do at
its next meeting in December.

Oil Minister Ali al-Nuaimi also called on leading oil
consuming states to stop blaming the OPEC cartel for their
"suffering" from high crude prices, which he said were due to
taxes those nations were imposing.

"Global inventories today are in a very comfortable position.
As a matter of fact, supply today is higher than demand," Nuaimi
told reporters after a meeting of Gulf Arab oil ministers in the
Saudi capital.

"Prices have started to stabilize," added Nuaimi, whose
country is the world's top oil exporter.

But he would not say if he thought OPEC would at its meeting
in Kuwait on Dec. 12 renew its offer to pump an additional two
million barrels per day (bpd) or consider an output cut for next
year to prevent prices from dropping, as some pundits have
predicted.

The option of OPEC pumping an additional two million bpd is
now "on the table. What happens at the meeting, I will tell you
when we meet," he said.

The oil cartel will "study the market then, and the decision
will be taken accordingly," Nuaimi said, adding he expected a
growth in demand in 2006.

OPEC's current official production ceiling is 28 million bpd,
and it maintains the option of pumping the extra two million bpd
if demand requires.

Prices are now in the range of US$55-$58 a barrel after
reaching a record high of more than $70 in late August.

Nuaimi echoed a call by Saudi King Abdullah last week on
leading consumer states to cut taxes on petroleum products.

"We hope that major consuming countries will discontinue
blaming the burden on the consumer on OPEC. What they should do
is look at ... where is the source of the burden," Nuaimi said.

"The source of the burden is both the tax and the VAT which
are imposed on the individual. So it is not fair to say that the
consumer is suffering because of the price of crude oil. He is
suffering because of the high burden of taxes on him."

Qatari Energy Minister Abdullah bin Hamad al-Attiyah said OPEC
would consider "all options" when it convenes next month.

"I'm not saying there (will be) a cut or not. I said every
time we met this ... has been the practice. We will discuss all
the options," he said.

"There should be no shortage of supply, (nor) should there be
a big surplus on the market," Attiyah said.

Iran's OPEC envoy, Hossein Kazempour Ardebili, was quoted
Saturday as saying the cartel did not need to alter its output
quotas at the December meeting.

The meeting of Gulf Cooperation Council (GCC) oil ministers
opened with an appeal to consumers to reciprocate the "wise and
flexible" policies of Gulf Arab oil producers by refraining from
applying protectionist and "discriminatory" measures.

The Gulf bloc is committed to "guaranteeing oil supplies and
meeting growing demand for crude" and to coordinate with other
producers and well as with consuming countries in order to help
"improve the performance of the world economy," the GCC chief
said in a statement read on his behalf.

But the GCC policies "will not bear fruit in terms of
achieving the desired stability on oil markets ... without the
cooperation of the other parties and without refraining from
pursuing protectionist policies and laws (which impose) taxes and
discriminate against oil," Abdulrahman al-Attiyah said.