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Opec panel sees need for more oil

Vienna, June 4, 2011

An advisory panel of the Organization of the Petroleum Exporting Countries (Opec) has agreed that the group should raise output to meet higher second-half oil demand, as delegates gave split views over a possible increase in targets at next week's meeting.

One Gulf Opec delegate said the group would consider the first hike in its output ceiling since 2007. But two other delegates, including one from another Gulf Opec member, said they saw no need for the Opec to increase limits on June 8.

The debate comes as persistently high oil prices threaten to slow an already faltering economic recovery, and amid mounting pressure from consumer nations demanding the group take action.

Opec's Economic Commission Board at the group's Vienna headquarters, a panel which looks at data on the oil market but does not decide Opec policy, met on Friday and agreed more oil was needed, a delegate who attended a meeting of the group's advisory board told Reuters on Friday.

'There will be more demand during the second half of the year, and there is a need for Opec to meet that demand,' said the delegate, who spoke on condition of anonymity. He said the ECB had made no recommendation on how much more oil to pump.

Earlier this week Gulf sources had said Opec would discuss an increase of up to 1.5 million barrels per day (bpd), nearly equal to the production cut off in Libya, but that a rise of 1 million bpd would be the most likely outcome.

'There will be a consideration to raise output given that in the second half of the year demand will be higher, but this is just a consideration, not something certain,' the first Gulf delegate said.-Reuters




Tags: Oil | Opec | panel | rising demand |

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