LUANDA, Angola - OPEC looks poised to hold output steady when it meets this week, with Saudi Arabia's oil minister yesterday declaring that current oil prices were "excellent" and another of the bloc's top officials saying there is agreement on maintaining existing production targets.
The comments on the eve of the Organization of the Petroleum Exporting Countries' meeting here in Angola's capital reflected a belief that a decision not to change supply had all but been made.
"There is a consensus that there is no change," Secretary General Abdalla Salem el-Badri of Libya told reporters when asked about OPEC's output plans for the meeting, which starts today. Even for next year, he said, changes to output are "not on our radar at this time."
Oil is trading near the $75 a barrel price that OPEC kingpin Saudi Arabia and several other members say they are happy with, arguing that it is fair for both producers and consumers.
Saudi Oil Minister Ali Naimi said upon arrival yesterday that the oil market was "very good. The price is excellent."
The challenge for OPEC now is to keep prices high enough without jeopardizing early signs of worldwide economic recovery.
The bloc last week nudged its 2010 forecast for global oil demand slightly higher, but warned that the market still faced risks because of lingering questions about the world's ability to rebound from its worst recession in decades. It expects demand to remain weak through the first half of 2010.
"We have to watch the market very carefully now, hoping that 2010 will be better," Qatar's oil minister Abdullah bin Hamad al-Attiyah told reporters.
OPEC still faces one of its most common and largely insurmountable challenges - keeping its members true to their production targets. As oil prices have rebounded, some of the 12-member group have exceeded their quotas to tap into the higher prices.
The Qatari oil minister said tackling historically high levels of cheating within OPEC would be on today's agenda. "We will discuss it," Attiyah said.
Crude prices have staged an incredible turnaround in the past year, more than doubling from a low below $35 a barrel."When the price of oil gets to $80, OPEC obviously recognizes it would inhibit recovery," said John Hall, chairman of EnergyQuote's John Hall Associates consultancy in London. "They are concerned. They want to see recovery move ahead."