Qatar's Oil Minister Doesn't Expect 'Dramatic' Decision At OPEC Meeting

Qatar's oil minister said he does not expect OPEC to make a "dramatic" decision during the upcoming OPEC meeting in June, and that the market is still well supplied.

"We think the fundamentals are fine... I don't expect OPEC to take a dramatic decision," Mohammed al-Sada told reporters on the sidelines of an industry meeting in Doha on Sunday.

Oil fell on Friday to cap a frenzied trading week that sliced prices by a record of more than $16 a barrel on demand worries and a move by investors to slash commodities exposures.

Brent crude fell $1.67 to settle at $109.13 a barrel in heavy trade, with volumes twice the 30-day moving average. The contract tumbled $16.76 a barrel for the week, marking the largest weekly decline ever in dollar terms.

"Today the price of most commodities has dropped, not only oil. We think that fundamentals are fine and we cannot see any shortage of supply," said al-Sada.

He added that OPEC and non-OPEC countries were producing enough crude to keep stocks at a "healthy" levels, and it is in the interest of OPEC countries to reduce price volatility.

"We are after the stability of oil prices. It's in the interest of suppliers and consumers," he said.

Asked if he expects a free fall in the oil price similar to the one in 2008, al-Sada said it was unlikely.

"The world economy is not bad enough to a see a free fall (in oil prices). Many developing countries are sustaining healthy GDP growth."

(Reporting by Regan Doherty; Editing by Amena Bakr)

Copyright 2011 Thomson Reuters. Click for Restrictions.

Comments

[1oldhippie]

05:25 PM on 05/09/2011

OPEC has stated that a barrel of oil should be 70/75 dollars. The rest is 'speculation'.
We could create a group, say, OFEC (organization of FOOD exporting countries), but the hard working farmers would never see an extra dime!
I live in farm country and have asked many farmers about eight dollar corn. They say its a 'myth'. Most locked in contracts for half that. Wall street, trades those contracts and make as much as the farmer, for doing jack squat...

[keramos]

07:20 AM on 05/09/2011

Lot's of press this morning about there being a looming glut of oil on the market and a potential for a fall of some $0.50 per gallon by labor day.  We should follow on with this bit of good news by adding to the margin rates required of oil traders and start squeezing out the speculation and fear premiums that have driven the cost of oil artificially high.

[bigshotprof]

04:02 AM on 05/09/2011

They don't need to pump more oil. The American speculators just need to stop acting like little girls at a slumber party who just found their brother's Ouija Board and stop driving up the futures.

[Dan Wetzel]

02:59 AM on 05/09/2011

Is there ever?

[MaxHeadroom]

10:11 PM on 05/08/2011

Yeah.. Like they can make a difference. Oil is under a $100 per barrel yet the price at the pump for regular unleaded still hasn't dropped below $3.89/barrel all weekend long. Who is fooling who?

Time for windfall profit tax again as the the big oil companies with their Republican buddies are keeping the price high all the while collecting their "much deserved" oil subsidies of over 4 billion a year, courtesy of the U.S. Taxpayer.

Gotta love it: Only in Amerika.

Geesh.

[retie133]

10:07 PM on 05/08/2011

I think if we got out of Iraq and Afganistan oil prices would drop down .The amount of fuel used to fight these wars has been astronomical and we have been paying high prices from the start.

[bluejoni2525]

07:14 PM on 05/08/2011

It's the speculators !!!!

[rchwel]

10:33 PM on 05/08/2011

True, I think the speculator parasites should actually have to buy the oil at the price they set lets see how long that speculation scam lasts.

[bluejoni2525]

11:12 PM on 05/08/2011

Yes !! No more paper barrels they should have be able to take delivery !!! F&F

[keramos]

07:20 AM on 05/09/2011

Increase margin requirements!

[GOP Victory 12]

06:17 PM on 05/08/2011

Domestic manufacturing tax deduction -- $1.7 B. This is a tax deduction given to every manufacturer in the US. Per CNN, it was "designed to keep factories in the United States." If that deduction were eliminated for oil companies only, it would mean singling out oil companies from all other manufacturers.

Percentage depletion allowance -- $1 B. Any industry can write down a portion of the cost of its capital equipment as part of the cost of doing business. Right now, oil in the ground is treated as capital equipment. Again, this "subsidy" amounts to how the cost of doing business is defined. All companies get it, not just oil companies.

Foreign tax credit -- $850 million. Companies get credit for taxes they pay to other countries. All companies get this "subsidy," not just oil companies. Should a company pay tax on tax? Should only oil companies pay tax on tax?

Intangible drilling costs -- $780 million. According to CNN, "[a]ll industries get to write off the costs of doing business, but they must take it over the life of an investment. The oil industry gets to take the drilling credit in the first year." Among these four tax "breaks," this smallest one was the only one that treated oil companies differently.

[keramos]

07:22 AM on 05/09/2011

Get rid of all tax giveaways to the oily corpulants.  Let's get at the true cost of this strategic product.  No more foreigners sapping our vital resources for profit only.

[GOP Victory 12]

07:49 AM on 05/09/2011

What you do for one, you must do for ALL.....so I hope you are prepared to put that rule on all the manufacturers and various industries. Exxon recently released its first quarter results for 2011. The number grabbing the headlines was Exxon's profit: $10.65 billion in a single quarter. The number not given quite as much exposure was the taxes it paid in that same quarter: $8 billion, or 42% of income before taxes.

And what does Exxon do with all that money it has left after paying $8 B in taxes? It put $7.8 billion into capital and exploration, as part of its plans "to invest between $33 billion and $37 billion per year over the next five years to develop new energy supplies."

In any other industry, that would be called "research and development." Exxon is plowing 73% of its after-tax profits back into R&D. Who would be better at spending $4 billion of energy companies' earnings in an attempt to provide our energy in the future: the energy companies or Obama's energy czar?

[southingtonian]

03:55 AM on 05/10/2011

Hehe, corpulants. :-) yes indeed!

[Robert Turner]

03:15 PM on 05/08/2011

OPEC Minister: Of course we expect (chortles) no dramatic changes. Just severe production restrictions, is all. HEY! We're not responsible for what the free market commodities traders are doing! (cough)boost prices!(cough)

[Dredd]

02:53 PM on 05/08/2011

Sounds like "The Day The Drama Died" (ode to Shakespeare)

http://blogdredd.blogspot.com/2011/05/will-this-float-your-boat.html

[LogicalMathMan]

02:01 PM on 05/08/2011

In related news, Trump was overheard telling the Shiekh of Qatar to go F*cK----___ himself because he has already imposed a 25% tariff on Chinese goods.

[alpina]

01:15 PM on 05/08/2011

How bout we put SEAL team 6 outside the door of their meeting for them to walk by as they go in and see if that creates a little "drama" for them?

[Anne Mccormick]

07:44 PM on 05/08/2011

i will admit it's an amusing thought. however, i think SEAL team 6 has more important things to do right now

[alpina]

11:57 PM on 05/09/2011

If oil prices dropped to $58 a barrel as an end result, it might be worth their time, right? ;) I mean you gotta let the rottweiler out in the yard every once in a while...just for the effect.

[guveqzero]

12:43 PM on 05/08/2011

In a farce free market, price has nothing related to demand. Like with our 20% unemployment problem, economic prosperity has nothing related to the number of people working. In a fools market, price is what a bunch of speculators want the price to be. That is what exists today, now we need to deal with it.

[CubnKira]

12:30 PM on 05/08/2011

OPEC has been playing us for fools for decades and squeezing every dime out of us. While I am not a Trump supporter, I do like his attitude re: OPEC, and wish that both Bush and Obama didn't treat them with such deference. Obama bowing to the Saudi royalty sends the wrong message.

And why does Saudi Arabia, perhaps the most repressive regime regarding women and other religions, rarely even gets scolded much less invaded. Obama's Folly in Libya, and nothing done to the Saudis.

[LogicalMathMan]

01:59 PM on 05/08/2011

So, you were okay with GW planting a kiss on King Abdullah?

[sd4david]

02:50 PM on 05/08/2011

Bush held hands with the Saudi King.

It is STUPID to attack someone whose oil we NEED. we don't have the upper hand. We need their oil more than they need our dollars. We are addicted to oil. And we behave like addicts behave to their supplier. So lets NOT need so much oil, THEN we can tell them to go F themselves.

[jflorish]

12:06 PM on 05/08/2011

OPEC has been controlling the oil prices for decades. Nothing I would love more then to get away from oil and stick it to OPEC. I'm guessing that probably won't be in my lifetime unless we get some major technology breakthrough.

[any mouse]

07:06 AM on 05/09/2011

Actually, we already have the technology to become entirely independent of hydrocarbon energy,

BUT ...

it cost more than oil does today (but a lot less than oil will cost in a few years), and requires a complete rebuilding of the US energy production, distribution and usage infrastructure in the US.

BUT ...

No ONE in the US has the political will to force Americans to get off hydrocarbon based energy. Because Americans always go for the cheapest, short term solution, they will have to be forced by draconian laws such as massive taxes on low MPGe vehicles.

Instead of forcing things to change (like China is doing), the US waits and waits until "market forces" cause near panic and the applies band-aid quick fixes (that cost a lot more in the end than organized forced conversion).

Note that there are a small number of people in the US that have successfully become independent of hydrocarbon energy, but it cost them some cash and convenience, which most Americans are completely unwilling to do.

Energy is a classic "pay now or pay a lot more later" situation.