(Updates throughout, changes dateline from LONDON)
NEW YORK, May 19 (Reuters) - Oil steadied on Monday after
profit-taking offset comments from OPEC's president that the
producer group would not increase output at its next meeting in
September.
The U.S. light crude contract for June delivery <CLc1>,
which expires on Tuesday, fell 3 cents to $126.26 a barrel by
1:30 p.m. EDT (1730 GMT) after hitting a record peak of $127.82
on Friday. London Brent crude <LCOc1> fell 50 cents at $124.49
a barrel.
"We're probably down on profit-taking here, after recent
highs and as the June crude contract expires tomorrow," said
Amanda Kurzendoerfer, commodities analyst at Summit Energy
Services Inc in Louisville, Kentucky.
OPEC President Chakib Khelil reiterated recent comments
from the cartel that despite record prices, 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 top exporter 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.
[]
On Monday, the Saudi state news agency quoted Naimi as
saying that the current level of oil output was fulfilling
market demand. []
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 United States, which has been stung by the
global credit crunch and high energy costs.
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.
Qatar oil minister Abdullah al-Attiyah also insisted 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, adding the OPEC
nation planned to boost total oil exports to 2.3 million
barrels per day from 2.0 million bpd by the end of the year.
[]
Diesel has taken center stage in the world energy crunch as
tight power supplies in China, South Africa, South America 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 Jim
Marshall)
