Saudi Pumping Extra Oil to Meet Demand: Saudi Source By REUTERS Published: June 21, 2008 Filed at 2:06 p.m. ET JEDDAH, Saudi Arabia (Reuters) - Top world oil exporter Saudi Arabia has decided to increase oil supply to meet demand from customers, a Saudi oil source said on Saturday. Saudi Arabia will raise output to 9.7 million barrels per day in July, the fastest daily rate in decades. "We increased because they (our customers) asked for it," the source said. He was speaking as delegates from oil consuming and producing countries arrived in Jeddah for a meeting on Sunday to try tackle record oil prices. There was no consensus yet between consumers and producers on the causes of high oil prices, he said, but he believed there was a collective will to try to stem the record rally. "I really believe strongly that there is a political will of oil producers and consumers to lower the price and stabilize it, otherwise they would not have come," he said. Oil markets were well-balanced but the price of oil was unjustifiably high, the source said. "Right now the majority of people think the price of oil is very high," he said. "There is no justification for this price." The kingdom currently has spare output capacity of around 2 million barrels per day, he said. Saudi Arabia has a long-held policy of keeping a cushion to deal with any surprise global supply disruptions of between 1.5 million and 2 million bpd. (Reporting by Simon Webb, editing by Alex Lawler/Barbara Lewis)
Libya Says It May Cut Oil Output to Prevent Market Over-Supply By Ayesha Daya Last Updated: June 21, 2008 14:41 EDT June 21 (Bloomberg) -- Libya may reduce its oil production because there is more than enough supply in the market, Oil Minister Shokri Ghanem said. ``We may have to cut production,'' Ghanem said today on arrival in Jeddah, where Saudi Arabia has convened a special summit of producing and consuming nations to address record oil prices. The kingdom has decided to raise its oil output to meet what it says is additional customer demand. ``We don't see any need for more oil. There is plenty of oil in the market,'' Ghanem said, commenting on Saudi Arabia's decision. To contact the reporter on this story: Ayesha Daya in Jeddah, Saudi Arabia on adaya1@bloomberg.net
OK let me see the Saudi's say they are going to pump an extra 200,000 barrels a day more in July. The militants bomb pipeline reducing supply by 120,000 barrels a day. Now the the Libyan's says it is going to cut oil production due to over supply. It is starting to look like oil production is one step forward and two steps backward every week. Not too mention peak oil! http://www.bloomberg.com/apps/news?...id=aMTWS1Pzs0Jc Saudi to Raise Oil Output 2% in July, Al-Naimi Says (Update1) By Ayesha Daya and Maher Chmaytelli June 21 (Bloomberg) -- Saudi Arabia, which convenes a meeting of government and business leaders tomorrow to discuss world energy markets, will raise its oil output by 2 percent in July, the country's oil minister said. The kingdom will add 200,000 barrels of oil to its daily production next month, taking its total to 9.7 million barrels a day, Ali al-Naimi told reporters in Jeddah, Saudi Arabia today. http://www.bloomberg.com/apps/news?...A_0c&refer=home Libya Says It May Cut Oil Output to Prevent Market Over-Supply By Ayesha Daya June 21 (Bloomberg) -- Libya may reduce its oil production because there is more than enough supply in the market, Oil Minister Shokri Ghanem said. ``We may have to cut production,'' Ghanem said today on arrival in Jeddah, where Saudi Arabia has convened a special summit of producing and consuming nations to address record oil prices. The kingdom has decided to raise its oil output to meet what it says is additional customer demand. ``We don't see any need for more oil. There is plenty of oil in the market,'' Ghanem said, commenting on Saudi Arabia's decision.
News gets better by the day. So it isn't the speculators. http://www.cnn.com/2008/WORLD/meast/06/21/oil.rise/index.html JEDDAH, Saudi Arabia (CNN) -- Oil prices are hitting record highs because production has not kept pace with increasing demands, U.S. Energy Secretary Samuel Bodman said Saturday. Saudi Arabia will host a meeting of oil-producing and -consuming nations Sunday in Jeddah. "All nations must be better at conservation, and the U.S. is at the top of that list," said Bodman, who is attending a international meeting of oil producing and consuming nations focusing on high oil prices in Saudi Arabia on Sunday. Although some have blamed speculators for driving up oil prices, Bodman said he did not believe that they are the cause
What do you expect Bodman to say? Seriously? At any rate, whether we who believe oil is plentiful, and delivery is being manipulated are right, or Mr. Bodman is right, the largest OPEC producer is ramping up production. Libya's comments are pretty much rendered meaningless on the news of Saudi increases.
Sounds like OPEC is starting to come apart. Soon there will not be a monopoly that can manipulate supply. They were trying to hedge against the falling dollar by keeping supply flat, but now they've created a bubble.
I'm not so sure. Saudi Arabia is pretty much OPEC. By increasing or decreasing production, they affect prices, and can twist arms of fellow members.