LONDON – Crude oil supply does not need to increase because rising prices reflect bottlenecks in gasoline supply, OPEC's head of research said on Friday, despite calls from consumers for more crude.
"I think that pumping more crude into the market is not needed," Hasan Qabazard, head of OPEC's research division, told Reuters. "We have a bottleneck in the supply chain and the bottleneck is the refineries producing gasoline for the summer."
The comments came a day after Brent crude rose to a nine-month high above $71 a barrel and on the heels of calls from the International Energy Agency, which represents consumer countries, for OPEC to raise output.
Oil has risen from about $50 in January for reasons including lower supply from OPEC, violence in Nigeria that has cut output there and a drop in inventories of gasoline in the United States.
The Organization of the Petroleum Exporting Countries, source of more than a third of the world's oil, agreed last year to curb output by 1.7 million barrels per day, roughly six percent.
Qabazard, the top research official at the group's Vienna headquarters, said the return of oil refineries from maintenance would help boost fuel stocks and lead to lower prices.
"Eventually, when refineries are at full throttle and the gasoline stocks, which have already started to rise, will rise more and that will push the prices down," he said.
U.S. gasoline stocks rose in the latest week to 196.7 million barrels but remain 14.5 million below year-ago levels, a government report showed on Wednesday. Various refinery problems have curbed production.
Brent crude was trading at $70.78 a barrel as of 1234 GMT, up 6 cents. It hit $71.80 on Thursday as a strike in Nigeria threatened more of the country's output and Iran remained defiant over its nuclear work.
OPEC gathers on Sept. 11 to set supply policy and officials have consistently ruled out a need to meet before then.