Growing demand for OPEC oil

Saudi Arabian petroleum and Mineral Resources Minister Ali I. Naimi has said that current demand for OPEC oil exceeded OPEC's new ceiling of 27.5 million bpd.
He stressed that if all member countries abided by their quotas, demand would exceed supply, leading to a rise in oil prices.
In an interview with the Saudi "Al Hayat" Naimi said OPEC's decision to raise its ceiling from 25.03 mm bpd to 27.5 mm bpd at its ministerial conference in Jakarta, Indonesia last month was meant to meet the world's growing demand for OPEC oil.
He reiterated that Saudi Arabia's policy was aimed at maintaining stability in the oil market.
"We realise that demand for Saudi oil in the first quarter of 1998 will exceed 8.76 mm bpd, the quota assigned to Saudi Arabia by OPEC," Naimi said.
He said the drop in oil prices since the Jakarta meeting was due to psychological reasons, noting that the market had received no additional supplies this month, compared with November and October. Some statisticsshowed supply in Dec. was even less than in the previous two months, he said.
Naimi said the Shaiba oil field in Saudi Arabia's "empty" quarter was expected to start production in the middle of next year. The field would be able to produce 500,000 bpd in a short time, he said.
The minister noted that the kingdom had an oil production capacity of 10.3 mm bpd, however, he said Shaiba was not part of a Saudi plan to increase production.
"Despite the fact the kingdom has the capacity to produce 10.3 mm bpd at present, there is no need to increase output, besides there is not sufficient demand," he said.
Naimi said it was one the kingdom's priorities to develop the gas and oil sectors. Saudi Arabia's proven gas reserve stands at 204 trillion cubic feet, while its crude oil reserve stands at 261 billion barrels.