Oil production curbs in doubt
OPEC'S commitment to cut oil output by am barrels a day has been thrown into doubt by fresh signs that it may allow 'leakage' to boost supplies.
Indonesian oil minister Purnomo Yusgiantoro, the cartel's president, said members may allow more oil on to the market if crude prices continue to soar.
'We will allow leakage if the price is strong but currently the price is not reflecting fundamentals,' he said. Brent crude dropped one cent to $30.49 a barrel.
Yusgiantoro's comments raise questions about Opec's credibility, given last week's vote by the cartel to curb output ahead of the traditionally weak second quarter.
The decision took its daily output ceiling to 23.5m barrels, excluding Iraq, and surprised analysts who expected the cartel simply to control its overproduction.
Opec members have been pumping out some 1.5m barrels over its previous 24.5m quota since the start of the year.
Japan is likely to increase pressure for Opec to break its new production ceiling by making a personal request to Saudi Arabian oil minister Ali al-Naimi when he visits Tokyo today.
'We always ask Opec to provide enough crude to the market to prevent proces from surging,' Seiji Murata, vice-minister of economy, trade and industry said.
'Crude supplies to the market are higher than its output quotas. We would like Opec to continue such flexibility in order to supply enough crude.'
