OPEC president sees oil quota unchanged

OPEC president sees oil quota unchanged

TOKYO (Reuters): Oil traders can expect business as usual next month at the OPEC meeting in Jakarta, with a likely roll-over of its production quota, the group's president said yesterday.

"I don't expect there will be an increase in Jakarta. I believe they will roll over again," Abdullah bin Hamad al-Attiyah told Reuters in an interview.

"I expect a very ordinary meeting," he said of the Jakarta OPEC session, scheduled to begin on Nov. 26.

The group meets twice a year in order to review its own policies and assess the global oil supply/demand balance.

But Attiyah, who is also Qatar's oil minister, stressed that OPEC should no longer be expected to shoulder the burden of stabilizing prices for the entire oil industry, adding that markets were too volatile and in some cases unrealistic for one group to control.

"OPEC is the only organization in the oil world trying to stabilize the market and see very closely the reactions of the market," Attiyah said.

"And yet today's markets are psychological. They are all reactive, and not very realistic markets. Prices go up and down in the same day with no indications, no reasons," Attiyah said. Producing countries outside of OPEC should take a more cooperative stance in regulating their output in order to control world oil prices, Attiyah said.

"Last summer (at the OPEC meeting) in Vienna we tried to send a signal to non-OPEC countries by maintaining our quotas," Attiyah said, "but signals are not always heeded."

OPEC's decade-old system of restricting member-country production in order to gird global oil prices has met with increasing skepticism in recent years for what appear to be blatant quota violations by some producing countries.

The group's output, estimated in a Reuters survey at 27.54 million barrels per day (bpd) for September, has risen by over a million bpd in the last year and is about 2.5 million bpd, or 10 percent, above OPEC's official 25.03 million bpd ceiling.

Qatar, the group's smallest producer, is also said to be its biggest quota violator on a percentage basis with estimated daily production of 660,000 bpd, sailing some 75 percent over its 378,000 bpd quota.

Attiyah said he would not discuss whether the tensions seen at the last OPEC meeting in Vienna between Saudi Arabia, the group's largest producer, and Venezuela, which is said to be the largest volumetric quota violator, would resurface in November.

"We should not be a judge in advance," Attiyah said.

Asked whether the eventual return of OPEC-member Iraq as a full-fledged oil producer would affect the group's planning, Attiyah said he hoped United Nations sanctions, imposed on Iraq following its 1990 invasion of Kuwait, would be lifted.

"It is my opinion that Iraq has the right to produce its own oil," Attiyah said, adding that any strain in relations between the U.N. and Iraq would only be temporary.

"Whatever happens today with the United Nations agreement, tomorrow or after tomorrow, Iraq will come back to the market," he said.

The Organization of Petroleum Exporting Countries consists of Qatar, Saudi Arabia, Iran, Iraq, Kuwait, Libya, the United Arab Emirates, Indonesia, Venezuela, Algeria and Nigeria.