Thursday, June 30, 2011

OPEC Calls on IEA to Avoid Oil Releases


VIENNA—OPEC's top official said Wednesday he wants to mend fences with the International Energy Agency and avoid a repeat of a release of oil from stockpiles that has strained consumer-producer relations.

Abdalla Salem El-Badri, secretary general of the Organization of Petroleum Exporting Countries, said he hoped to set up a sit-down meeting with IEA Executive Director Nobuo Tanaka to discuss better coordination between consumers and producers. "We don't want this to be repeated," Mr. El-Badri said of the IEA's controversial release.

Mr. El-Badri said he would tell Tanaka, "Let us not disturb the market." Still, Mr. El-Badri's remarks Wednesday struck a more conciliatory tone than earlier in the week, when he joined other OPEC figures in sharply criticizing the IEA move. The IEA Thursday surprised markets by initiating an emergency release of 60 million barrels, pushing down oil prices and generating near-universal criticism from OPEC figures.

"Maybe [IEA's executive director Nobuo Tanaka] will come here [in Vienna or] I will go there and try to discuss the aftermath of this decision," Mr. El-Badri said.

The Paris-based IEA represents the governments of oil-consuming countries. Mr. El-Badri's Vienna office includes a prominent photograph with Tanaka in which the two men are seen smiling.

Mr. El-Badri said he wasn't trying to stop the planned release. "It's a decision, it's taken, it's over," he said. "I hope this will be the first and the last."

Mr. El-Badri said no plans had been finalized to meet Mr. Tanaka. But he said his message would be that consumers and producers should work together closely in case of sudden disruptions to supplies, saying OPEC members are always ready to supply market needs.

"We are partners in this business," he said. "I would like to assure him that we are supply the market," he said.

Mr. El-Badri made reference to statements by some OPEC members that signaled they would boost output to meet increased demand after a June 8 OPEC meeting disintegrated in disagreement. Despite the outcome of the June 8 meeting, "some of our member countries...are ready to add more oil into the market," Mr. El-Badri said.

"The IEA didn't give time for those countries to fulfill their commitments," he added.

Mr. El-Badri said he did have a conversation with Mr. Tanaka in the early days of the Libyan crisis.

"We had a telephone call during the Libyan crisis at the time" but "both of us thought that the problem would not last for more than two months," he said.

Although Mr. El-Badri read IEA comments in the press that suggested a possible release, he said he wasn't informed by the IEA of the agency's intent to release some of its stocks ahead of last Thursday's move.

"They didn't tell me they wanted to release this quantity," he said. Mr. El-Badri said he had been planning to meet with Tanaka in recent weeks on other business, but the two never managed to get together.

"Mr Tanaka [was] supposed to come here. He [wanted] to visit Vienna...but he was not able to come," he said.

Mr. El-Badri said he didn't foresee any emergency OPEC meeting before a scheduled gathering in December.

"We have a December meeting. There is no emergency meeting in our radar at this time."

Write to Benoit Faucon at

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