Oil producers reject raising output

ROME: Oil-producing countries have rejected calls to raise output amid record prices, five times higher in as many years, saying the rise in demand was artificial.

Kuwait's acting oil minister said on Sunday that supply and demand factors are not to blame for the soaring price of crude oil, which reached fresh highs last week.

Oil prices hit record highs above 117 dollars per barrel in New York, following a pipeline attack in Africa's biggest producer Nigeria.

"The level of stockpiles does not currently affect prices on the world market," Mohammad al-Olaim said on the sidelines of an energy forum in Rome attended by oil-producing countries, companies and consumer nations.

"The fundamentals do not affect the market," he said. "If there is a need to raise" production, ministers of OPEC, of which Kuweit is a member, "will make a decision," he added.

Organisation of the Petroleum Exporting Countries (OPEC) president Chakib Khelil, currently touring Kuwait, echoed him, saying there was no need for an immediate hike in production. He said the cartel "does not need to raise output in the near future," according to Kuwait's KUNA news agency.

"Today there is no need to get worked up and say, 'We must put more oil on the market', because the demands of oil consumers are probably motivated by political reasons," said Saudi Oil Minister Ali-al Naimi.

"We have raised output over last year and the prices have continued to climb," he told the Petroleum Argus, an oil industry weekly.

Calls for OPEC to raise output were distinctly muted, even if the deputy head of the International Energy Agency, founded during the 1973-4 oil crisis to defend the energy interests of 27 major consumer countries, said it was "unreasonable" for the 12 members of OPEC's cartel to "fix demand for the next 30 years".

Both Kuwait and Qatar's oil ministers underlined OPEC's common position that there are ample reserves of fuel available at the world's pumps.

OPEC Secretary General Abdullah al-Badri reiterated Saturday that ministers from OPEC member states did not need to meet on the sidelines of the Rome energy forum, despite soaring prices.

Khelil, on his part, said the falling value of the US dollar was responsible for the surge in oil prices. "When the dollar loses one percent, the price of a barrel of oil rises by four dollars," he said.