OPEC probably will not cut output: Purnomo

OPEC probably will not cut output: Purnomo

Bloomberg, Singapore

OPEC would probably not cut oil production when it meets in June because prices are high, Indonesia's Energy Minister Purnomo Yusgiantoro said on Thursday.

The Organization of Petroleum Exporting Countries is pumping at full capacity, producing about 30 million barrels of oil a day, Purnomo said.

OPEC will next meet on June 15 in Vienna.

"Right now we are doing it at maximum capacity," he said. "Markets are over-supplied."

Oil and gasoline prices reached records last month as concern that rising demand might outpace supply eclipsed efforts by OPEC to bring prices down.

The group agreed in March to boost oil-output quotas by 500,000 barrels per day (bpd) to 27.5 million bpd, and to add another 500,000 bpd as early as May should prices continue to rise.

OPEC is unable to control prices because a lack of refining capacity in the U.S. and investments by hedge funds are pushing them higher, said Qatar's energy minister Abdullah bin Hamad al- Attiyah on May 9.

Crude oil futures in New York have fallen from a record US$58.28 a barrel reached on April 4 though are 23 percent higher than a year ago.

"We still have a high price. This high oil price is not because of OPEC," Purnomo said.

The International Energy Agency, an adviser to 26 countries, said in its monthly report on Wednesday that rising oil inventories are insufficient to compensate for the lack of spare production capacity that's keeping oil prices above $50 a barrel.

Crude oil for June delivery on the New York Mercantile Exchange fell as much as 60 U.S. cents, or 1.2 percent, to $49.85 a barrel in after-hours electronic trading after a U.S. government report Wednesday showed that the country's oil inventories rose last week.

Oil production by the 11 members of OPEC rose 0.9 percent to 30.7 million bpd in April, the highest since October, a Bloomberg survey showed last week.