OPEC oil producers are likely to keep their official oil production targets unchanged when they meet on Sunday, choosing to enforce existing quotas rather than cut output further, a Reuters poll showed on Tuesday.
Nine of 14 analysts polled thought the Organization of the Petroleum Exporting Countries would agree to roll forward production ceilings when they meet in Vienna on March 15.
Five analysts suggested the 12-member producer group would opt to reduce output quotas. The average output cut forecast by this minority was a reduction of 710,000 barrels per day (bpd).
Oil prices have fallen by around 70 percent since hitting an all-time peak of almost $150 per barrel in July last year as the global economic downturn has forced consumers and companies to reduce energy consumption.
OPEC has made a series of cuts in production over the last six months in attempt to balance the market and bolster prices.
The group has so far promised to cut 4.2 million bpd from its production levels in September and Reuters' surveys suggest OPEC has been fairly successful in enforcing the reduction, with more than 80 percent compliance.
Oil prices have recovered from recent lows between $30 and $40 a barrel and now trade in the mid-$40s, a rally many analysts say probably reflects recent cuts in OPEC production.
"CUT LESS LIKELY"
"I think a further cut is looking less likely, unless prices fall in the second half of this week," said Julian Lee, senior energy analyst at the Centre for Global Energy Studies.
"The time lags involved in moving oil from the Middle East to the United States and Europe mean that we are only just beginning to feel the effect of the recent output cuts in lower arrivals. The volume of oil arriving in the U.S. and Europe will continue to fall in the weeks ahead."
Several OPEC members are desperate to prop up oil prices as their budgets have been squeezed hard over the last few months.
Economists calculate that at $40 per barrel, 11 of OPEC's 12 members, as well as Russia and Mexico, face budget deficits.
Venezuela has said inventories are high and that it would agree to another output reduction in oil production quotas.
But cutting production is painful and Saudi Arabia, by far the largest OPEC producer and exporter, wants OPEC to discuss stricter compliance with existing supply curbs before considering more cuts, a Saudi-owned newspaper said on Monday.
Surveys suggest OPEC may still have to trim production by up to 800,000 bpd before it has met fully its promised cuts.
Lawrence Eagles, head of commodities research at JP Morgan in New York, said reports this week of Saudi Arabia's views, pointed to OPEC keeping production quotas unchanged.
"The Saudi statement suggests a no change announcement," he said. "The hawks will be pushing for a 1 million bpd cut announcement. I would go for the former."
How much will OPEC change its output targets on March 15?
million bpd Bache Commodities 0 Barclays Capital -0.5 BNP Paribas 0 Centre for Global Energy Studies 0 Deutsche Bank -0.5 Global Insight 0 HSH – Nordbank 0 J.P.Morgan 0 Landesbank 0 MFC Global Asset Management 0 MF Global -0.75 Petromatrix -0.8 PVM 0 Societe Generale -1.0 AVERAGE FORECAST (MODE) 0
