Opec to discuss oil policy Feb 22 in Riyadh

Tuesday, 1 February 2011 00:01 - - {{hitsCtrl.values.hits}}

London, Reuters: Opec ministers will discuss oil output policy on the sidelines of an international energy conference in Saudi Arabia on February 22, an Opec delegate said.

The Organization of the Petroleum Exporting Countries is under pressure to raise output and rein in oil prices now near $100 a barrel.

Energy ministers from Opec are scheduled to gather on Feb. 22 in Riyadh with their counterparts from oil consuming nations and consumer body the International Energy Agency at the International Energy Forum.

‘All the Opec ministers will be in Riyadh during that time, so this would be a chance to discuss the situation in the market,’ the Opec delegate who declined to be named told Reuters.

Opec’s next scheduled meeting is not until June but the producer group has shown in the past that it is flexible enough to set policy at short-notice when necessary.

It is not yet clear whether the Riyadh meeting will set policy or not. Ministers could decide to call an emergency meeting before June.

Brent oil prices hit a 28-month peak on Friday, nearing $100 a barrel while U.S. crude surged more than 4 percent as anti-government protests in Egypt -- which is not an Opec member -- rattled markets.

‘Before taking any action, we need to wait for Egypt to settle down because its too early to say what will happen at this point,’ said the delegate.

Opec ministers blame speculators for the rise in oil prices and say global inventories are plentiful. ‘Stocks are still plentiful,’ said the Opec delegate.

But most oil analysts say prices are rising to ration demand as the West emerges from recession and as emerging markets growth continues apace.

Saudi Arabia is already pumping a little above its official 8.05 million barrel a day Opec allocation with a Reuters survey estimating output last month at an average 8.33 million bpd.

The Opec delegate said current Saudi output was 8.4 million bpd. Opec has not changed oil output quotas since cutting supplies sharply more than two years ago to combat a drop in demand when recession hit economies globally.

Oil prices slumped from a record $147 a barrel in mid 2008 to just over $33 late that year