OPEC Again Raises Production Ceiling
Cancels extraordinary meeting
By Mike Oduniyi with Agency report
The Organisation of Petro-leum Exporting Coun-tries (OPEC) yesterday said it had cancelled its extra ordinary meeting scheduled for next week, but okayed the increase in the group's crude oil production quota by 500,000 barrels per day (bpd).
The increase, which will see OPEC's production ceiling rising to 26 million bpd effective August 1, 2004, will push Nigeria's OPEC quota to 2.142 million bpd from 2.101 million bpd.
In a statement issued from OPEC's Vienna headquarters, its President, Purnomo Yusgiantoro, said market conditions had not changed since the June 3, 2004 meeting in Beirut, Lebanon, when it took the decision to raise production by 2.5 million bpd.
Yusgiantoro said that OPEC members had already increased supply to the market and that it would further raise output ceiling by 500,000 bpd to 26 million bpd from August 1.
"There was now no call for the meeting to take place," he said, adding, "Consultations took place yesterday (Wednes-day), among OPEC heads of delegation on market developments since the 131st (extraordinary) meeting of the OPEC conference held in Beirut, Lebanon."
"The supply/demand outlook, a review which has confirmed that market conditions remain essentially unchanged," the statement said.
Amid fears that OPEC may go back on its plans to effect the August production increase, the group, which controls more than 40 percent of global oil supply, said it was going ahead with the plan in order to maintain adequate supply to the market and support the continued, robust, global economic growth.
"In these circumstances, the organisation has decided that there is, therefore, no call for the conference to meet on 21st July 2004, as originally foreseen," the statement said.
It said OPEC would continue to monitor market developments and remained determined to meet whenever the need might arise in order to maintain market stability and keep prices at acceptable levels to both producers and consumers.
Oil prices, which hit an all-time high of $42 per barrel in first week of June this year, dropped sharply on news of OPEC decision to raise production. Prices, which hovered around $35 par barrel to the delight of oil consumers, have however, been climbing following news that OPEC might not raise production any longer.
OPEC is next scheduled to meet on September 15, this year.
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