Qatar to cut crude oil supply

Qatar, one of Opec’s smallest oil producers, told at least three Asian lifters it will cut crude supplies for January by five per cent, sources said yesterday after Kuwait and the UAE pledged to boost term sales. Abu Dhabi and Kuwait told many major term customers earlier this week that they would supply full contracted term volumes for January, compared with cuts in November and December. Qatar Petroleum (QP) had not informed lifters of supply cuts in the weeks following Opec’s late October deal to cut production by 1.5 million barrels per day (bpd) until this week, traders said, although its oil minister said last month in Tokyo that it was making visible cuts in supply. “QP notified term lifters to cut Qatar Land and Qatar Marine allocations for January 2009 by five per cent,” a source with a refiner said. Three other lifters said they had yet to receive any notice for January, but some were unconcerned. “We are not checking closely as we do not need that much,” a trader with a second lifter said. Qatar’s oil minister, Abdullah al-Attiyah, told reporters on Wednesday that Opec will cut supplies at its next meeting in Algeria on December 17 as oil prices have fallen by more than $100 a barrel since July’s record peaks. Opec ministers meeting in Egypt last weekend deferred a decision on whether to reduce supply further amid signs that Saudi Arabia and its Gulf neighbours wanted tighter compliance with existing supply curbs. Opec members cut only 66 per cent of the 1.5 million bpd of a supply cut they had pledged in November, a Reuters survey showed. Qatar told at least two lifters last month that it was not planning to cut supplies in November and December. Core Opec members the UAE and Kuwait will increase oil sales to many major Asian customers next month, sources said on Tuesday, sending a mixed signal to markets looking for evidence of sustained Opec cuts. (Reuters) Iran demand The oil market is clearly oversupplied and producers should cut output to balance fundamentals, Iran’s Opec Governor said yesterday. “It is obvious that the market is oversupplied,” Mohammad Ali Khatibi told Reuters. “This is a critical situation and all producers are in the same boat, we are all suffering. If you remove oversupply and produce exactly what the market needs, it would be good for everybody.” “Every day we see more negative news,” he said. “It is difficult to quantify demand as the problem is getting worse every day.” Opec’s second largest producer was pumping at around 3.8 million barrels per day (bpd), Khatibi said.