Oil and Gas

OPEC to Keep Output Steady as US Slows: President


A combination of economic slowdown in the United States and a seasonal fall in consumption will hit oil demand and OPEC will not increase output when it meets next week, the producer group's president said on Tuesday.

"I can tell you they are not going to increase production because there are plenty of stocks," OPEC President Chakib Khelil told Reuters.

"Gasoline stocks are high, then we have a second quarter reduction in demand and with the economic situation in the U.S., probably a recession, demand will definitely fall, maybe not by much."

Oil demand typically eases in the second quarter following the end of the northern hemisphere winter and refiners often take advantage of the drop in consumption to carry out maintenance.

Adding to comment from other ministers and oil executives, Khelil said that if refiners asked for less crude from April onwards, the Organization of the Petroleum Exporting Countries (OPEC) would supply less.

"If we are not able to sell our crude, then definitely we are not going to supply more," Khelil, who is also Algeria's energy and mines minister, said on the sidelines of a gas conference in Abuja.

With oil prices close to $100 a barrel, OPEC will be under pressure when it meets on March 5 in Vienna to refrain from a formal cut in output.

But the group, that is producing above its agreed output target, could still reduce the amount of oil it supplies to customers.

Khelil said Algeria was producing around 1.4 million barrels per day (bpd), slightly above its target of 1.357 million bpd.