Saudi Arabia would ease production if it believed oil markets were oversupplied.
OPEC on its meeting on Dec. 10 in Cairo will decide whether to make a formal reduction in its collective production ceiling, so Saudi source said the kingdom will continue to pump 9.5 million barrels a day "for the time being."
"Our policy is to satisfy our customers needs and to make sure the oil market is balanced," the source said. "We do not like oversupply or undersupply. If the market told us that it was oversupplied, we would adjust production."
The oil minister of OPEC?s second biggest producer Iran yesterday said that world oil markets were oversupplied, the first sign of unease in the cartel over falling prices.
State-owned oil company Saudi Aramco, has had difficulty placing incremental barrels of Arab Medium and Arab Heavy crude oil for months. Demand has been relatively sluggish for the heavier, high-sulfur grades that are more costly and cumbersome to refine into desired light-end products such as gasoline and heating oil. Now, even Aramco's offers of additional Arab Light cargoes are being turned down, said traders, who also complain that Aramco has priced its crude too high given market condition.
