(Updates prices)
By Jane Merriman
LONDON, May 19 (Reuters) - Oil fell below session highs on
Monday, after OPEC's president said the producer group would not
call an early meeting and was unlikely even at its September
gathering to boost supply as the world had enough oil.
U.S. light crude for June delivery <CLc1> was up 14 cents at
$126.43 a barrel by 1406 GMT.
It closed at $126.29 a barrel on Friday after touching a
record peak of $127.82 earlier that day after publication of a
bullish price forecast from investment bank Goldman Sachs.
London Brent crude <LCOc1> was down 8 cents at $124.91 a
barrel.
Chakib Khelil, president of the Organization of the
Petroleum Exporting Countries, said oil markets were well
supplied and blamed high prices on speculation, a weak dollar
and geopolitical problems.
"As for OPEC, indications shows that there is no shortage
(of supply)," he said in Algiers
Khelil said OPEC would not meet before its next scheduled
gathering in September and that this meeting was unlikely to
result in an output increase.
"All in all, there is little indication that we are on the
verge of a major price breakdown," said Edward Meir, analyst at
broker MF Global.
He said a production increase from Saudi Arabia, revealed on
Friday, was only "token" in terms of extra production.
Saudi Arabia has boosted oil output by 300,000 barrels per
day to meet demand and compensate for other producers' lower
output, Saudi Oil Minister Ali al-Naimi said on Friday.
[]
U.S. President George W. Bush said on Saturday he was
pleased with the Saudi move, but it was not enough to solve
problems in the top energy consumer the United States.
OPEC COMMENTS
But comments by OPEC oil ministers on Monday all highlighted
that global oil supplies are enough to cope with demand.
Qatar oil minister Abdullah al-Attiyah also said there was
no need to boost oil supplies to global markets. "The market
doesn't need more oil," he said, pointing to a cut in forecast
oil demand growth by the International Energy Agency.
"There is more oil in the market than consumers want," said
Iraqi oil minister Hussain al-Shahristani. []
Iraq aims to boost total oil exports to 2.3 million barrels
per day from 2.0 million bpd by the end of the year, he said.
Oil prices have risen sixfold since 2002 and doubled since
last year as rising demand from China and other developing
nations has stretched spare production capacity, adding pressure
on the U.S. economy already hard hit by a housing slump.
Diesel has taken centre stage in the world energy crunch as
tight power supplies in China, South Africa, Chile, Argentina
and parts of the Middle East triggered a boom in demand for
middle distillates for electric generators.
Chinese demand for imported diesel is expected to rise even
further in June after last week's earthquake disrupted gas
supplies to major cities and as companies built stockpiles ahead
of the summer Olympics.
Investment bank Lehman Brothers warned that record-breaking
commodities prices that were drawing in hundreds of billions of
dollars in new investments threaten to create an asset bubble.
(Additional reporting by Fayen Wong in Perth; editing by James
Jukwey)
