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OPEC says it has capacity to meet demand
The Organization of Petroleum Exporting Countries has “more than adequate” spare capacity to cover expected global demand this winter, acting Secretary-General Adnan Shihab-Eldin said Oct. 31.
Shihab-Eldin told an energy conference in Moscow that the 11-member bloc’s spare capacity is currently 2 million barrels a day, according to Dow Jones Newswires.
Shihab-Eldin said he expects OPEC to increase its output by a total of 12 million barrels a day over the next five years, faster than OPEC’s expectations for global demand growth, which he estimated at 7 million to 8 million barrels a day. Bottlenecks in refining He added, however, that he expects refining bottlenecks to put upward pressure on prices at least for the next two years. Shihab-Eldin said that global refining capacity won’t match world demand growth until 2007.
“OPEC itself has the reserves to meet ... growing oil requirements ... and to ensure that the market will be well supplied with crude at all times,” Shibah-Eldin said.
The group has repeatedly voiced concerns about the inability of industrialized countries’ refineries to cope with the increased volume of relatively high-sulfur, or sour, crude that its members and other major exporters such as Russia have shipped to world markets in recent years.
Shihab-Eldin repeated calls made the week of Oct. 24 for companies to invest more in refining and for governments to do more to encourage such investments.
Current high oil company profits don’t seem to have translated into investments in refining so far, he added.
—The Associated Press
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