OPEC unlikely to shift output targets: oil ministers

OPEC appeared poised to hold oil production quotas unchanged Wednesday, with its ministers voicing satisfaction with current global crude prices.

Instead, the focus at the organization's meeting in Vienna was to be on persuading members not to sell more oil than their quotas permit.

Crude's current price 'is good for everybody: consumers and producers' Saudi Arabian oil minister Ali Naimi

Kuwait's oil minister, Sheik Ahmed Al Abullah Al Sabah, said OPEC's markets monitoring committee would suggest to the 12-country group that oil output targets be held steady at the organization's meeting late Wednesday in Vienna. The gathering is being held in the evening since it falls during the holy month of Ramadan when Muslims must fast from dawn to dusk.

The recommendation offers further indication that ministers from the bloc supplier of roughly 35 per cent of the world's crude are turning their aim toward encouraging member discipline. Compliance with the output limits, which are designed to support prices, has been waning.

Prices are now roughly double their levels from December, when the Organization of Petroleum Exporting Countries announced its record 4.2 million barrel per day cuts from September 2008 levels. The price rally has been welcome news for cash-hungry member governments, but also a temptation to sell more oil.

U.S. benchmark light sweet crude for October delivery was hovering at around $71 US in electronic trading on the New York Mercantile Exchange. The level is well within the range that OPEC kingpin Saudi Arabia, and others, have said it would like to see.

Saudi Arabian Oil Minister Ali Naimi, whose country is OPEC's top producer and most influential member, told reporters Tuesday that crude's current price "is good for everybody: consumers and producers."

OPEC quotas routinely topped

OPEC leaders are concerned a price spike could hurt the nascent global economic recovery after the world's worst recession in decades destroyed demand for crude, the chief foreign revenue source for the majority of OPEC's members.

Iraqi Oil Minister Hussain al-Shahristani told reporters that while prices were significantly higher than at the start of the year, "we feel that there is still some room for improvement."

"But we are satisfied at the [current] level," said al-Shahristani, adding that "all indications [are] that the market is well supplied, and I don't think there will be need, really, to revise our previous decision."

The group's current production target is just under 25 million barrels per day, but output figures excluding Iraq indicate OPEC members are pumping around 26 million barrels per day, analysts say, adding that Angola, Iran and Venezuela have been particularly lax with their quotas.

Kuwait's Al Sabah said Tuesday while a quick rebound in demand for crude was unlikely, he expected a "noticeable improvement" in the first and second quarters of 2010.

That leaves the group with little room for error if it hopes to see current prices sustained through the year.