OPEC says subprime crisis clouds demand picture

 @ibtimes
on August 28 2007 9:10 AM

OPEC Secretary-General Abdullah al-Badri said on Tuesday that the subprime crisis in financial markets has made it very difficult for the group to gauge demand for crude but supply levels were adequate for now.

The situation in the past couple of weeks has become a lot more serious, Badri told Reuters in an interview.

Speaking during a visit to Angola, OPEC's newest member, Badri said the producer group hopes to discuss establishing a quota for the southern African nation in a December meeting.

Badri, who held talks on the issue with Angolan Oil Minister Desiderio Costa, was optimistic that there would be no differences on the matter.

An output allocation for Angola, which has little reason to raise output because it is enjoying an oil bonanza and one of the world's highest economic growth rates, would give OPEC greater control over the market and less competition from independent producers.

We will not have a quarrel when we discuss this sometime later this year, he said.

OPEC, which has resisted demands from consumer nations for a production increase, will meet on September 11 to set policy.

Badri was not concerned about supply levels. But he said the subprime mortgage crisis in financial markets will cloud the demand picture over coming months and knock-on effects may hurt global economic growth ahead of an OPEC meeting in December.

My point of view is the market is very well supplied. There is no shortage whatsoever in the market. And because of subprime mortgage problems, at this time the picture is not very clear to us. It will be much clearer in December, he said.

OPEC has a further meeting planned for December in the United Arab Emirates.

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