U.S. says OPEC shouldn't cut output at Dec meeting
Source: Reuters
(Adds comment from U.S. senator on suing OPEC, paragraphs 12-13) By Tom Doggett BETHESDA, Md., Dec 1 (Reuters) - U.S. Energy Secretary Sam Bodman said on Friday that OPEC does not need to cut its oil output when the producer group meets later this month, because markets still need OPEC's crude to meet global demand. "I encourage them to keep markets well-supplied," Bodman told reporters after a speech to an African energy conference. When asked if he thought another OPEC production cut was not needed, Bodman replied: "That's my belief." Bodman said he was worried about the impact an OPEC cut would have on winter heating oil supplies in the United States. The Organization of Petroleum Exporting Companies meets on Dec. 14 and some of the group's ministers are pushing for a production cut because of fears of lower global oil demand, especially in the second quarter of next year. However, Guy Caruso, who heads the federal Energy Information Administration, told reporters that U.S. refiners will need OPEC oil in the second quarter to make gasoline for the busy summer driving season. "You need to build up (inventories) for gasoline for the summer. So refiners try to keep as a steady a crude supply as possible" he said. Saudi Arabia Oil Minister Ali al-Naimi said in Cairo on Friday that U.S. oil inventories were high and that was helping to "significantly" oversupply the world oil market. The Energy Department reported this week that U.S. commercial oil stocks stood at 341 million barrels, well above the average range for this time of year. But Caruso said OPEC ministers won't have complete information about U.S. oil inventories by their December meeting, making any further decisions on output cuts risky. He said OPEC's November production cut of 1.2 million barrels per day will not be reflected yet in U.S. crude stock levels due to the lengthy travel time for oil tankers. "They won't have the full impact of the cuts," Caruso said. "It won't really have shown up yet in a very timely or complete way." In response to Naimi's comments, Democratic Sen. Frank Lautenberg on Friday called for the Bush administration to immediately file a complaint against OPEC with the World Trade Organization for manipulating oil markets. "Just as gasoline prices have finally started to come down, we see OPEC making moves to shoot prices back up again," Lautenberg said. "If President Bush and Vice President Cheney refuse to stand up to this cartel, then they are refusing to stand up for American families. Separately, Bodman said he was not worried about Angola, Sudan and Ecuador joining OPEC, and that the U.S. government was not lobbying those countries against becoming members of the oil producer group.
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