Lagos (Platts)--4Jan2008
A Nigerian delegate to OPEC said Friday he believes it is unlikely the
cartel will raise its crude output when the group meets in Vienna on February
1 because the market is "well supplied."
"The feelers now are that nobody is convinced that the market is in short
supply (of oil)," the Abuja-based delegate said. "The market is still
well-supplied. What (oil) OPEC is offering has not been fully taken."
Oil prices fell by almost $2 Friday on profit-taking after the week's
record-breaking run to $100/b, driven largely by concerns over tight supplies
and a weak dollar.
Despite seven straight weeks of crude stock draws in the US, where
inventories are now at a three-year low, several OPEC ministers this week said
there was little OPEC could do to cool prices that reached $100/b for the
first time.
"Unless and until what OPEC is offering is fully taken, then OPEC will
not talk about increasing supply and Nigeria will support that," the delegate
said. "But for now, supply is not the problem."
OPEC officials continually pinned the run-up in crude prices in 2007 on
refining bottlenecks in the US, geopolitical worries, market speculation by
hedge funds, and strong oil demand from China and India.
Additional price support this week came from renewed violence in
Nigeria, although exports have not been affected.
"Tuesday's clashes between militants and troops had no direct impact on
oil production or loadings," the delegate said. "But once the international
media mentioned Port Harcourt, oil traders got jittery, not minding that the
fighting was not near any oil wells or export terminal."
At least 12 people were killed over New Year in Nigeria's oil capital
Port Harcourt when gunmen attacked two police stations and a hotel.
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