OPEC President: Likely to Raise Oil Output
Monday, March 14, 2005
STORIES
•OPEC: Oil Prices Will Stay High •OPEC Poised to Keep Supply Steady at $40 Level
OPEC will likely raise its output ceiling by 500,000 barrels a day if prices stay at present levels, Kuwaiti Oil Minister and OPEC president Sheikh Ahmad al-Fahd al-Sabah said Monday.
Meanwhile, leading OPEC producer Saudi Arabia called for a modest increase in cartel supplies that could help ease oil prices from near-record highs.
Saudi Oil Minister Ali al-Naimi, speaking ahead of a Wednesday meeting of the Organization of the Petroleum Exporting Countries (search), said the group should lift supplies by 500,000 bpd, two percent, to 27.5 million bpd.
A 500,000 bpd increase in OPEC output quotas would not add much to supplies on the 83-million-bpd world market.
With OPEC already overshooting quotas by about 700,000 barrels a day, any such move would mostly have psychological effect by signaling that the organization is formally ready to pump more in an effort to regulate prices.
Prices have shot up by nearly 20 percent in the past five weeks to around $54 a barrel in New York — a little more than a dollar shy of all-time records — putting pressure on the 11-nation organization to cool the markets.
Basic economics 101.
Yeah. I understand that. Just injecting a little humor in.
Now let's all look at the price of a gallon of milk and water. Basic economics 101.