OPEC secretary-general: Oil market “balanced” despite speculation after attacks

by The Associated Press

World oil markets look balanced despite market speculation after the terror attacks in the United States, OPEC's secretary-general said Sept. 17.

“There has been and still is a lot of speculation, but I would say the market is still balanced,” Ali Rodriguez told Dow Jones Newswires by telephone from OPEC headquarters in Vienna, Austria. “Prices went up due to nervousness, but they likely will reverse that trend a bit,” he said.

Rodriguez, a former Venezuelan oil minister, said he didn't know if OPEC will reverse a 1 million barrel a day production cut it implemented on Sept. 1. OPEC ministers are meeting in Vienna Sept. 26.

“It's still too early to decide on that. We need a clear picture on the demand side. We could have an increase (in demand) due to seasonal effects, but we can't ignore the negative impact of a possible recession of the world and U.S. economy,” he said.

Rodriguez said he had assured U.S. Energy Secretary Spencer Abraham on the day before that OPEC was committed to market stability, “just as we have shown over the past two years.”

Kuwait's News Agency quoted a Kuwaiti oil official on Sept. 17 as saying that OPEC was prepared to accept a price of between $20 and $22 a barrel, lower than OPEC's target price of $22 to $28 a barrel. Rodriguez declined to comment on the report.

Crude oil prices soared to more than $30 a barrel in London immediately after the Sept. 11 attacks. The value of OPEC’s basket of seven crude oils averaged $27.36 per barrel Sept. 14, up from $26.23 per barrel Sept. 13, OPEC’s news agency said.

OPEC produces 40 percent of the world’s oil.