No Need for OPEC to Boost Oil Output: Qatar

More crude supply from OPEC would do little to ease $80 oil as speculative investment flowing into the market from other assets is boosting the price, Qatar's oil minister said on Monday.

U.S. light, sweet crude was trading at $81.43 a barrel on Monday.

The price has been above $80 for much of the last three weeks, despite OPEC's agreement on Sept. 11 to boost output by 500,000 barrels per day from Nov. 1.

"I am confident that the price is not related to supply," Qatar's Oil Minister Abdullah al-Attiyah told Reuters by telephone. "We increased at the last OPEC meeting and were confident that it would help the market, but unfortunately the market is moving in a different direction. More oil won't help at all."

Members of the Organization of the Petroleum Exporting Countries (OPEC) were not in consultations at the moment about boosting oil supply, he said.

Two weeks ago, an OPEC source told Reuters the producer group would hold talks about a further supply boost if the price stayed above $80 for several weeks.

Attiyah said he did not know if OPEC would consult on output before the heads of state of its 12 members gather at a summit in Riyadh in November. Oil ministers were due to meet ahead of the summit.

The global credit crunch had encouraged investors to switch to oil from other assets, Attiyah said.

"Our increase in output could not overcome the investment flow switch," he said. "Investors believe oil is safer than some others (assets)."

The weak dollar was not making OPEC more resistant to an output change, Attiyah said. The higher price has helped insulate oil producers from the erosion of their spending power due to dollar weakness. The U.S. greenback hit a new record low against the euro on Monday.

"The weak dollar and OPEC's supply are not related," he said. "But it has affected us. A lot of our imports are in euros."

Qatar had no plans to change its policy to price and receive payment for all of its oil in dollars, Attiyah said.

Neighboring Gulf Arab OPEC members Saudi Arabia, the United Arab Emirates and Kuwait also receive all their oil revenues in dollars.

Iran, locked in a row with Washington over its nuclear work, is aiming to boost oil export earnings in non-dollar currencies to 80% by the end of October. It already receives more than 70% in other currencies.

Qatar is OPEC's smallest oil producer, with output of around 800,000 barrels per day.