OPEC: Organization of Petroleum Exporting Countries, Won't Boost Output Amid Record Oil. Chakib Khelil

Organization of Petroleum Exporting Countries won't consider increasing crude output before September, even amid investor concern that record oil prices may cause a global economic recession, according to the group's president, Chakib Khelil.

``OPEC will not increase crude oil output,'' Khelil, who is also the oil minister of Algeria, said in an interview today in Algiers. ``Supply is more than sufficient in the international market. Prices are not the consequence of demand and supply, they are the consequence of speculation.''

The Organization of Petroleum Exporting Countries, which controls more than 40 percent of the world's crude supply, doesn't meet again until Sept. 9 to review its production ceiling. Khelil said there was no plan to meet before then.

Crude oil rose to a record $119.90 a barrel on April 22 on the New York Mercantile Exchange, as the dollar dropped to all- time low against the euro, prompting investors to buy commodities as a hedge. The contract settled at $118.52 on the last trading day of the week yesterday.

The 13-member Organization of Petroleum Exporting Countries decided to keep output quotas unchanged at a meeting on March 5. The group produced 32.3 million barrels a day in March, according to Bloomberg estimates.

Volatile Prices
Khelil said the surge in oil prices was not responsible for slowing world economies. ``If there is an economic recession in the U.S., it is due to the subprime crisis,'' he said today.

On April 21, OPEC Secretary-General Abdalla El-Badri said in a Bloomberg Television interview in Rome that prices would probably remain volatile for the next seven months, adding OPEC would not meet formally before September. ``When we look at supply, we don't see a shortage,'' he said.

Venezuela, the largest crude-oil producer in Latin America, doesn't expect the price of oil to drop below $90 a barrel any time soon, Energy and Oil Minister Rafael Ramirez said April 21 at the International Energy Forum in Rome. He also said OPEC should not change its current output levels.

Nobuo Tanaka, the head of the International Energy Agency, on April 22 said a global recession is ``a possibility.'' International Monetary Fund First Deputy Managing Director John Lipsky on April 21 said current prices would remove up to 1 percentage point from global growth.

Source: Bloomberg|By Ahmed Rouaba and Maher Chmaytelli

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