QUITO: Saudi Arabia said Saturday it still favored a $70-$80 price range for oil, a restatement of a two-year-old policy that will be welcomed by consumer nations worried that rising oil prices may get out of control and hamper global economic recovery. Saudi Oil Minister Ali Al-Naimi told reporters at an OPEC meeting in Quito: “$70-$80 is a good price.” The comments came as the Organization of the Petroleum Exporting Countries agreed, as expected, to keep production restraints in place, despite a recent surge in crude prices to $90 a barrel. “The fact that Naimi keeps saying $70-$80 a barrel makes it a meaningful statement,” said Edward Morse, Managing Director at Credit Suisse in New York. US crude closed at $87.79 a barrel Friday having touched a two-year high of $90.76 earlier in the week. Venezuela called for $100 oil and said OPEC should not lift output again through the end of 2011. “We believe that the market should compensate high production costs. $100 appears to be an adequate price,” said Venezuelan Oil Minister Rafael Ramirez. Iranian Oil Minister Massoud Mirkazemi said global oil demand was “not good” and that “nominal prices are good, real prices are not.” OPEC agreed its biggest ever supply curbs at the end of 2008 after a price collapse from $147 to just over $33 caused by a recessionary drop in fuel demand. It has not changed policy since. Many OPEC ministers say supplies are sufficient and that they will only open the taps to meet extra demand. “Once there is a shortage in the market, or once we feel there is a shortage in the market, we of course will increase production but it is not just a function of the price,” Libya's head of delegation Shokri Ghanem said. “If prices go high because of speculation we can do nothing about it,” said Secretary General Abdullah Al-Badri. “When you go to buy oil and you cannot find it, that's when OPEC will interfere and solve it.” The International Energy Agency, adviser to consumer nations, said Friday that world demand, bolstered by an early winter cold snap, is rising more quickly than expected. Extra demand has flattened the oil futures price curve and reduced the discount for prompt crude, cutting the incentive for traders to store oil, likely meaning inventories will start dropping.
