OPEC head says $75-80 a barrel a 'good price'

ABU DHABI (AFP) – Seventy-five to 80 dollars a barrel is a satisfactory price for oil, the president of OPEC said on Monday, adding that the cartel may leave production unchanged at its meeting next month.

"Seventy-five to 80 dollars a barrel is a good price... for the recovery of the world economy," Jose Maria Botelho de Vasconcelos, who is also Angola's oil minister, told reporters on the sidelines of a conference on Gulf energy security in Abu Dhabi.

Oil prices were trading within that range on international markets on Monday.

De Vasconcelos said the cartel may leave production unchanged at its next scheduled discussion in Luanda on December 22, though "there is a provision for an increase" in production.

"This situation will be discussed" at the December meeting, he added.

However, he also told reporters on the sidelines of the conference that "the market is oversupplied."

De Vasconcelos said the rate of compliance by OPEC members with their production quotas "is around 65 percent." This rate is satisfactory, he added.

OPEC expects oil demand to rise by 20 million barrels a day (bpd) to 106 million by 2030, he said, but warned of uncertainty in the market.

"There is too much uncertainty in the market over such matters as future world economic growth levels, consuming country policies and technology," the OPEC chief said in a speech to the conference.

"This makes it almost impossible to devise effective investment strategies for future production capacity, to meet forecast rising levels of demand."

"The latest projections in OPEC's reference case see world oil demand rising by 20 million bpd to 106 million between 2008 and 2030. But these are only projections -- the reality may turn out to be very different in an uncertain world."

"So every effort must be made to avoid adding to this uncertainty in an unnecessary way," he added.

He said that one way to minimise the uncertainty is through consumer governments devising measures to ensure transparency and consistency in their policy making, which OPEC had already urged governments to do.

"This is one key area where efforts can be made to reduce uncertainty," he said.

De Vasconcelos also spoke about energy security and called for a reduction in the "very high levels of taxation imposed on oil products in many consuming countries."

He also said that the world economy, including the energy industry, performs best in an environment of interdependence among nations.

"Its (the energy industry?s) infrastructure and trading patterns are well-established and global in nature," he said.

"No country can afford to go it alone in the energy industry today. We should all recognise the true value of interdependence among nations and the comprehensive nature of energy security."

"This will support sound world economic growth," he added.

In London trading on Monday ,New York's main contract, light sweet crude for delivery in December, was up 90 cents to 77.21 dollars a barrel at midday.

Brent North Sea crude for January delivery gained 87 cents to 77.22 dollars a barrel.