World oil demand currently outpacing supply:
US' Abraham
London (Platts)--20May2004
World oil demand is currently out-pacing supply, US energy secretary Spencer Abraham said Thursday, voicing his concern that high oil prices could harm global economic growth. There is "clearly a growing level of demand over a fairly lengthy period of time," Abraham told reporters in London. "Markets are very tight because demand is outpacing supply levels," he said, adding that this was "a major component of the [high] price of oil." "There may be other factors but we believe the issues of supply and demand are central to the way the market is behaving," he said, speaking after giving a speech at the Royal Institute of International Affairs. Abraham said the US administration of President George W Bush was "deeply concerned" about the impact of high prices. "High energy prices could have a major potential impact on the growth of the world economy," he said. From London Abraham is due to travel to Amsterdam to attend this weekend's International Energy Forum, a biennial meeting of the world's major energy consuming and producing countries. While in Amsterdam, Abraham has planned bilateral talks with the oil ministers of five OPEC countries--Indonesia, Kuwait, Qatar, Saudi Arabia and the UAE. Abraham, who is expected to press the OPEC ministers to boost oil output to bring down surging crude and gasoline prices, said he welcomed the "opportunity to convene in Amsterdam and have a very open discussion." "Producers and consumers do better in a growing world economy," he said. Asked to comment on whether he thought OPEC had abandoned its official price target of $22-28/bbl in favor of higher oil prices, Abraham said he took OPEC countries seriously when they said the $22-28/bbl band still applied. OPEC ministers are expected to meet in Amsterdam to discuss a proposal put forward earlier this month by Saudi oil minister Ali Naimi for output quotas to be raised by at least 1.5-mil b/d to ease high oil prices. In addition to the informal discussion in Amsterdam, OPEC is due to convene a formal ministerial conference Jun 3 in Beirut. This story was first published in Platts real-time news and market reporting service Platts Global Alert (http://www.platts.com/Oil/Real-Time%20Information/Global%20Alert/ ).
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