Saudi Arabian Oil Minister Ali Al Nuaimi said yesterday that Opec had “a little more work to make the market even more stable”, a hint the oil exporters’ group needed to reduce its output further.

His comments could mean a further cut in Opec production target, currently at 26.3 million barrels per day, or greater compliance from Opec members, some of whom are suspected of producing more than their allocated amount.

 

“The fundamentals of the market are much better than they were in October and I think the market is moving towards better stability.
“We probably have a little more work to make the market even more stable,” he said as he arrived here.

The Organisation of Petroleum Exporting Countries, whose members regulate their oil exports to control the price of oil, took a decision in Qatar in October to cut their output by 1.2 million barrels per day.

The cut has helped to lift prices since, but analysts believe that actual production has been cut by far less, with the real reduction estimated at between 500,000-800,000 barrels per day. The comments by Nuaimi indicate that he believes the market is still over-supplied.

Analysts had suggested before the start of the meeting that the issue of overproduction and quota cheating would figure at the gathering.

“We made a good decision in Doha,” Nuaimi said, referring to the decision to cut production at the Opec meeting in the Qatari capital in October.

He added: “I think the market is in much better situation than it was in October, but we need to do a little more.” The high level of oil stocks in OECD countries, the biggest oil consuming nations in the world, was one of the reasons given for falling oil prices in September and October.

Commenting on developments since Ocotober, Nuaimi said: “Already 50 (million barrels) has been taken out of the market.” pf-adp/nh AFP 131413 DEC 0