Opec to examine how to cut price of oil
Opec oil producers are becoming increasingly worried over stubbornly high oil prices and will be exploring "various options" for the September meeting which will hopefully help ease prices, the cartel chief said today.
"We are becoming increasingly concerned at the continuing high level of oil prices, which does not properly reflect the underlying fundamentals of the market," Sheikh Ahmad al-Fahd al-Sabah said in an English language statement in Kuwait City.
"OPEC will be exploring various options for the September meeting which will hopefully contribute to moderate prices," added Sheikh Ahmad, who is also Kuwait's energy minister.
He did not elaborate on the nature of these options. Sheikh Ahmad said oil resources and supplies are plentiful and Opec has been producing more than the call on Opec crude by 1.5 million barrels per day in the third quarter of 2005.
He said existing spare capacity in Opec countries, together with new capacity additions early next year, will be more than adequate to cover demand growth throughout the winter this year and in 2006.
"Furthermore, demand is starting to slow down as a result of high prices," he said.
"In view of these fundamentals, one expects to witness some price moderation rather than any further rise," Sheikh Ahmad added.