Algeria oil min favors OPEC cut
VIENNA (Reuters) - OPEC President Chakib Khelil, speaking in his capacity as Algerian energy minister, said on Tuesday he favored an OPEC oil output cut to counter a slowdown in demand for fuel.
As OPEC president, Khelil said there was no consensus in the group for such a move and two options -- of holding output steady or cutting -- remained on the table.
"I would prefer in this situation to lower production, as Algerian minister," he told reporters. "The second quarter we are definitely going to have lower demand."
Speaking earlier on Tuesday, the OPEC president said "No change" when asked for his expectation of the group's Wednesday meeting.
Khelil said crude and gasoline stocks in the United States, the world's largest energy consumer, were already at multi-year highs.
That has raised concerns among the Organization of the Petroleum Exporting Countries that a short-term supply glut could send triple digit prices spiraling lower later this year.
"Cutting may not be easy or appear to be the right thing to do, but for the medium-term it may be the best thing to do," he said. "Sometimes we have to make a hard decision now because we want to ensure stability in the future."
Khelil said global oil demand could fall by as much as 2 million barrels per day in the second quarter.
U.S. oil prices soared to a record high of $103.95 on Monday and were trading above $102 on Tuesday.
Khelil said he did not believe any OPEC action could influence the current oil price since the market was being driven largely by speculative funds and a weak dollar.
The minister said he favored another OPEC meeting later this year because markets were particularly volatile.
The next opportunity for OPEC ministers to confer on output policy after Wednesday's meeting is in Rome next month at a consumers/producers conference.
"Anything can be discussed ... we don't need to have a meeting of OPEC to discuss that at that level," Khelil said.
"As president I always have the possibility to call my colleagues and make a decision."
