DUBAI, United Arab Emirates – The Organization of Petroleum Exporting Countries (OPEC) will cut oil output at its next meeting on Dec. 17 in Algeria, Qatar's oil minister said Wednesday.
"For sure we will cut in Oran (Algeria)," Abdullah al-Attiyah told reporters on the sidelines of a petrochemical conference in Dubai. "I don't know by how much. We will discuss it there."
US crude settled below $47 a barrel on Tuesday, the lowest close since May 2005 and over $100 below the peak in July. The impact of the growing global economic crisis on oil demand and OPEC's inaction at informal talks in Cairo at the weekend pushed prices lower this week.
Attiyah said on Tuesday that OPEC was concerned about a glut of crude supplies on the market.
OPEC ministers meeting in Egypt deferred a decision on whether to reduce supply further amid signs that Saudi Arabia and its Gulf neighbors wanted tighter compliance with existing supply curbs.
OPEC members cut only 66 percent of the 1.5 million barrels per day (bpd) of a supply cut they had pledged in November, a Reuters survey showed.
Despite holding any decision to cut further, a majority of OPEC oil ministers, including those from core members in the Gulf, discussed in Cairo the need to reduce supply by 1 million to 1.5 million bpd at the next meeting in Algeria, OPEC delegates said.
Attiyah reiterated that a price of under $70 a barrel was threatening to derail projects to boost oil and gas capacity. Oil has stayed below $70 since Nov. 5.
"My concern is that the oil price will go lower," Attiyah said. "And many projects will be delayed."
OPEC's most influential member, Saudi Arabia, said at the weekend that oil prices needed to return to $75 to keep the more expensive projects at the margins of world supply on track. Other OPEC members, such as Nigeria and Kuwait, have supported the Saudi view that $75 is fair to both consumers and producers.
Qatar is a small OPEC producer and the world' largest exporter of liquefied natural gas (LNG). It also sits on the world's third-largest gas reserves.
The Gulf Arab state is on track to boost LNG production capacity to 77 million tons per year in 2010, Attiyah said.
A new production facility to produce 7.8 million tons per year of LNG would be commissioned in December, he added. Qatar started testing the facility, known in the industry as a train, in July. The plant will ship gas to Britain.
The project was delayed from start-up last winter as the number of simultaneous energy projects under construction in Qatar led to labor and equipment shortages.
Qatar would be producing around 23 billion cubic feet per day of gas in 2012-2013, he added.
