OPEC to maintain oil output ceiling
BY SUMMER SAID
VIENNA -- OPEC decided Friday to maintain its current oil production cap of 30 million bbl a day, people familiar with the matter told Dow Jones Newswires, after many ministers from the group said they were satisfied with current oil prices and that the market was balanced.
OPEC's largest member, Saudi Arabia, said ahead of the meeting that the oil market was in excellent shape. "The demand and supply are good, the inventories are good. So the market is in one of its best conditions," Saudi Oil Minister Ali al-Naimi told reporters prior to the meeting.
OPEC has had a collective oil production ceiling of 30 million bbl a day since December 2011, but actual output has consistently exceeded this level. The surplus has narrowed considerably over the past year. In April 2012, OPEC production exceeded its target by 1.6 million bbl a day, but the surplus was just 460,000 bbl a day last month, according to the group's monthly oil market report.
The decision not to change production comes as rising oil output in North America threatens to erode demand for OPEC's crude. The group's own analysts forecast that demand for its oil will fall by 400,000 bbl a day this year.
Rising U.S. shale oil production Thursday pushed U.S. crude inventories to their highest level in more than 80 years. Commercial crude-oil stockpiles rose by 3 million bbl, to 397.6 million bbl, last week, the highest level since 1931, the U.S. Department of Energy said in its weekly Petroleum Status Report. Oil stockpiles have risen 10% since the start of the year, and 30% since May 2008.
However, U.S. oil futures actually settled higher following the release of oil data Thursday, as gasoline demand rose. Light, sweet crude for July delivery settled $0.48, or 0.5%, higher at $93.61 a bbl on the New York Mercantile Exchange. Brent crude on the ICE futures exchange settled down $0.24, or 0.2%, to $102.19 a barrel.
Several OPEC ministers have said they are satisfied that a price of around $100 a bbl for Brent crude is fair both for consumers and producers.
--Sarah Kent and Nicole Lundeen also contributed to this report
Dow Jones Newswires