OPEC gives guarded response to U.S. call for oil

By Michele Kambas

NICOSIA (Reuters) - OPEC gave a guarded response on Wednesday to calls from President George W. Bush for more oil to lower near-record prices, saying supply was enough for now and exporters would pump more if needed.

With two weeks until OPEC meets to set policy and oil falling from a record high above $100 hit earlier this month, officials have continued to blame factors beyond their control for the run-up in prices.

"I'm sure the ministers of the conference will not be hesitant to increase production if fundamentals justify that," OPEC Secretary-General Abdullah al-Badri said in the Cypriot capital.

The oil minister for small Gulf producer Qatar said it was already clear there was no need to boost production. "I don't think the market needs more oil," Abdullah al-Attiyah told Reuters.

OPEC needs to be cautious ahead of the seasonal drop in consumption in the second quarter and because of the possible effect on oil demand of a U.S. recession, he added.

OPEC President Chakib Khelil added his voice on Wednesday, saying that if crude inventories rise during the second quarter, "I don't see why OPEC should raise output."

The White House earlier said Bush, wrapping up a Middle East trip on Wednesday, hopes his talks in Saudi Arabia will help encourage OPEC to raise production and dampen oil prices.

Saudi Arabia, the world's top oil exporter, vowed on Tuesday to boost output when the market needed more, although Saudi Oil Minister Ali al-Naimi did not say whether OPEC would do so at its meeting in Vienna.