Cartel president Purnomo saysgroup will discuss whether to raise output at Sept. 15 meeting.
August 26, 2004: 6:40 AM EDT
JAKARTA, Indonesia (Reuters) - OPEC wants a faster retreat in oil prices and will discuss whether to raise its official oil output ceiling at its Sept. 15 meeting, cartel President Purnomo Yusgiantoro said Thursday.
"If we (decide to raise output), we will inventory how much spare capacity that we have from each member of OPEC so we can increase the OPEC quota," he told reporters. "We will also meet with non-OPEC and other oil producers to discuss ways to cool down... and stabilize the price."
He said the current drop in global oil prices was not moving fast enough. Crude oil prices have fallen by nearly $6 from last week's record highs of $49.40 a barrel for U.S. light crude.
"The oil price is falling, but not much," said Purnomo.
"The downturn is slow. We hope the price will fall to around $30 per barrel. That is good enough," he said, referring to the OPEC reference crude price, which dropped to $41.43 a barrel on Tuesday from Monday's $42.27.
Overproduction
Purnomo, who is also Indonesia's oil minister, said OPEC was overproducing by two million barrels per day (bpd) above its official quota of 26 million bpd.
"Iraq produces around two million bpd, and OPEC has extra production of two million bpd, so total production is 30 million bpd," he said.
"OPEC is now overproducing about two million. That is the option that we have. We will also see whether we still have spare capacity because it is important."
Tanker tracking consultancy Petrologistics said OPEC was estimated to have raised output in August to 29.9 million bpd, up 400,000 bpd from July. It added that cartel kingpin Saudi Arabia was estimated to have boosted supply by 400,000 bpd in August to 9.5 million bpd.
The OPEC estimate includes output from Iraq, which was lower in the first half of August, after sabotage on its main southern export pipeline, Petrologistics said.
Purnomo said he was still waiting for OPEC's long-term strategic team to give a report on the acceptable crude price band if the cartel were to revise it.
Under self-imposed rules designed to keep the price of reference basket of seven crudes in a $22 to $28 range, OPEC can consider raising output if the basket price stays above the upper limit of the target band for more than 20 straight working days.
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