OPEC overproducing to curb oil prices

KUWAIT CITY, Monday (AFP) OPEC president Sheikh Ahmad Fahd al-Sabah reaffirmed here the cartel is producing 30.4 million barrels per day (bpd), one million bpd over market needs, in a bid to curb soaring oil prices.

"OPEC is currently producing 30.4 million bpd ... This production is more than the market needs to allow the building of strategic and commercial stocks in order to stabilise prices," Sheikh Ahmad told the official KUNA news agency.

He added there was one million bpd of overproduction in the market. The figure of 30.4 million bpd is the same as that given by OPEC officials in early August, well before Hurricane Katrina drove up oil prices to record highs.

Sheikh Ahmad said current oil prices are above what the crude prices should be. "If measured by economic factors only, crude prices should be lower than their current level," Sheikh Ahmad, who is also Kuwait's energy minister, said.

He attributed the rise to "geopolitical and climatic factors in addition to speculations in world markets and lack of refining capacity."

He also said that Hurricane Katrina in the United States will further negatively affect supply of products.

Sheikh Ahmad said in a statement Wednesday that OPEC would do its utmost to ensure the stability of the global oil market in the wake of Hurricane Katrina and would discuss the means at its meeting in Vienna on September 19-20.