MercoPress. South Atlantic News Agency

OPEC argues world oil stocks “remain at comfortable levels”

The Organization of Petroleum Exporting Countries, OPEC continues to monitor global oil markets and is prepared to help mitigate any tightness but the level of 30 million barrels a day ensures that commercial oil stocks remain at comfortable levels for the time being, said OPEC's Secretary General in Vienna.

Following the release last week of OPEC's monthly report on oil production, Abdalla Salem El-Badri said that global stocks remain healthy and "with OPEC maintaining production at its current level of 30 million barrels a day, this would ensure that commercial oil stocks remain at comfortable levels for the time being, if there is no significant change in market conditions". According to OPEC the most recent preliminary data for May indicates that total OECD commercial oil stocks are around 34 million barrels higher than the five-year average. Within Europe, total oil inventories have reached an historic high and now stand at 66 million barrels above the five-year average. In the US, crude stocks show an excess of 24 million barrels over the five-year average. While US gasoline stocks are still below the five-year average, they have generally shown an increasing trend in recent weeks. In May, gasoline stocks rose 4.9 million barrels. On the supply side there is an expectation of increased oil output from non-OPEC in the second half of 2007, as some production returns and delayed projects come on stream. OPEC however admits that considerable uncertainties continue to surround world oil demand and demand for OPEC oil. But a combination of current high inventory levels and increasing OPEC spare capacity, which is expected to reach around 15% in the second half of this year, means there are adequate supplies available to cope with any upward revisions to oil demand forecasts. Finally Abdalla Salem El-Badri said that oil markets remain well supplied and market fundamentals do not require any additional supply from the Organization at this time, but OPEC will continue to monitor developments and is prepared to help mitigate any tightness which may emerge at any future stage.