The Organization of Petroleum Exporting Countries (OPEC) wants oil prices that traded near $50 a barrel last week before retreating this week to fall faster, and will discuss whether to increase production at a meeting next month, the group’s president said Thursday.
“Oil prices have retreated, but we want them to fall to around $30 per barrel,” Purnomo Yusgiantoro told reporters. “That would be good enough.”
U.S. light, sweet crude futures traded on the New York Mercantile Exchange have fallen by nearly 12 percent since last Thursday, when they settled at $48.70 — the highest Nymex settlement on record — as concerns about supply disruptions have faded.
The October contract fetched $42.89 a barrel Thursday morning, down 58 cents from Wednesday’s settlement price.
Purnomo, who is also Indonesia’s mines and energy minister, said the group would discuss whether to increase its official output ceiling at a meeting in Vienna next month.
“That’s part of the agenda,” he told reporters. “If we consider that (raising output) needs to be done, we will take an inventory on how much spare capacity we have from each member of OPEC, so we can raise OPEC quotas.”
OPEC’s current production ceiling, excluding Iraq, is around 26 million barrels a day.
The rise in oil prices has been fueled by fears of terrorist attacks in the United States, disruptions to Iraqi crude exports, and uncertainty over the fate of troubled Russian oil giant Yukos.
Speculators have also played a part in the recent record run, which has come at a time of high global energy demand and limited spare production capacity, market-watchers say.
Analysts said Thursday that OPEC’s $30 a barrel target was probably unrealistic, and they expected crude prices to spike back toward $50 a barrel later this year.
“The market has taken a breather,” said Ng Weng Hoong, editor at EnergyAsia.com in Singapore. “An attack on $50 (a barrel) is still on the cards.”
Ng said some of hedge funds that had been betting on a surge in crude prices had cashed in some of their gains, helping prices to ease.