DUBAI - There is no need for the Organization of the Petroleum Exporting Countries (OPEC) to boost output this year, the group's head of research Hasan Qabazard said on Thursday.
"I really don't see a need this year" Qabazard told reporters at an energy event in Dubai.
Qabazard said stocks were building as oil production was outstripping demand by 800,000 bpd to one million bpd in the second quarter of this year.
That was before top oil exporter Saudi Arabia boosted supply, he said.
"This year there is more production than demand," Qabazard said. "With the 300,000 bpd from Saudi, stocks should build even more."
He estimated that the average daily addition in stocks for the whole year, including the increased Saudi output, would come to around 500,000 bpd.
Saudi Arabia announced earlier this month it would boost output by 300,000 bpd to meet increased global demand. The kingdom would further increase output later if needed, a senior Gulf OPEC source said on Wednesday.
OPEC is next scheduled to meet to discuss output policy on September 9.
Oil fundamentals were sound and did not justify high oil prices, Qabazard said.
There was no lack of supply, and no consumers struggling to find gasoline at gas stations, he added.
High prices were due to the weak dollar and increased capital flows into the oil market from other asset classes, he added.
Concern in oil markets that future supply would struggle to keep up with demand was unfounded, Qabazard said.
OPEC was in the midst of $160 billion of projects that would help take the group's capacity to more than 40 million bpd in 2012-2013, up from around 34-35 million bpd now, he said.
OPEC producers were also looking beyond that at 20-year expansion plans, he added.
"There is no need to be pessimistic about oil supply,", he said.
"We don't see a peak, maybe non-OPEC supply may plateau. There is anxiety from consumers based on models and speculation. But the facts on the ground are different. There are enough investments to meet demand."
"I really don't see a need this year" Qabazard told reporters at an energy event in Dubai.
Qabazard said stocks were building as oil production was outstripping demand by 800,000 bpd to one million bpd in the second quarter of this year.
That was before top oil exporter Saudi Arabia boosted supply, he said.
"This year there is more production than demand," Qabazard said. "With the 300,000 bpd from Saudi, stocks should build even more."
He estimated that the average daily addition in stocks for the whole year, including the increased Saudi output, would come to around 500,000 bpd.
Saudi Arabia announced earlier this month it would boost output by 300,000 bpd to meet increased global demand. The kingdom would further increase output later if needed, a senior Gulf OPEC source said on Wednesday.
OPEC is next scheduled to meet to discuss output policy on September 9.
Oil fundamentals were sound and did not justify high oil prices, Qabazard said.
There was no lack of supply, and no consumers struggling to find gasoline at gas stations, he added.
High prices were due to the weak dollar and increased capital flows into the oil market from other asset classes, he added.
Concern in oil markets that future supply would struggle to keep up with demand was unfounded, Qabazard said.
OPEC was in the midst of $160 billion of projects that would help take the group's capacity to more than 40 million bpd in 2012-2013, up from around 34-35 million bpd now, he said.
OPEC producers were also looking beyond that at 20-year expansion plans, he added.
"There is no need to be pessimistic about oil supply,", he said.
"We don't see a peak, maybe non-OPEC supply may plateau. There is anxiety from consumers based on models and speculation. But the facts on the ground are different. There are enough investments to meet demand."
