OPEC ministers say may hold off on more oil cuts

ABUJA, Dec 13 (Reuters) OPEC appeared willing on Wednesday to pull back from more oil output cuts, responding to consumer nation calls to hold off until winter has passed to guard against price spikes that would hurt the world economy.

OPEC, which produces over a third of the world's oil, will hold talks on Thursday to decide whether to curb supplies beyond the 1.2 million barrels per day ministers agreed in October.

''I don't think there will be any cut,'' the head of Libya's delegation, Shokri Ghanem, told Reuters.

There is consensus in the group the market is oversupplied -- crude oil stocks in top consumer the United States are at a 13-year high -- but some ministers fear cutting output now, during peak demand, could drive prices further above .

OPEC's core Gulf members, including leading exporter Saudi Arabia, are among those who favour holding fire, a delegate said.

They want to see OPEC focus on its existing agreement.

''No cut, compliance -- this is the view up until now from the Gulf members,'' the delegate told Reuters on Tuesday evening.

Members have delivered almost two thirds of the 1.2 million bpd reduction so far, according to Reuters estimates.

U.S. Energy Secretary Sam Bodman and the International Energy Agency have called on OPEC to wait until next year before deciding on further supply reductions.

Some ministers have indicated they are prepared to take note.

OPEC President Edmund Daukoru, among the strongest advocates of a cut, was reticent in comments to reporters.

''When we meet we will look at all the factors and we will come up with what is best for us, what is best for the consumer and what is best for the global economy,'' Daukoru, who is also Nigeria's minister of state for petroleum, said on Tuesday.

Kuwaiti Oil Minister Sheikh Ali al-Jarrah al-Sabah said he believed OPEC should stay its hand if prices remained at .

United Arab Emirates' Oil Minister Mohammed bin Dhaen al-Hamli said OPEC would only cut if ''absolutely necessary''.

Oil has fallen from a mid-July peak of .40 but is still three times the price at the start of 2002 as Asian demand kicked in.

Refining constraints and worries over supply from Iraq, Nigeria, Iran and Russia helped fuel the rally.

SLIM MAJORITY? A leading OPEC economist told Reuters on Monday a narrow majority of members were leaning towards further curbs of at least 500,000 barrels per day from the current output target of 26.3 million bpd, in place since Nov. 1.

Research director Hasan Qabazard put the split at 60/40.

Iran and Venezuela are among those pressing for a reduction.

Cuts in place have already gone some way towards draining oil stocks in the industrialised world that reached 2.76 billion barrels, 55 days of demand, in September. That compared with 2.64 billion barrels the previous year, or 53 days of demand.

OPEC is anxious not to damage the world's most important economy, the United States, and risk slowing oil demand growth.

Fears of U.S. economic weakness have knocked the dollar to its lowest levels for nearly two years against the euro.

''We believe that unless prices fall sharply in the next two days, OPEC will not cut because they will not need to and will not have any incentive to,'' said Mike Wittner, global head of energy market research at investment bank Calyon.

Ed Morse, chief energy economist at Lehman Brothers, predicted a tight oil market in 2007.

''Demand seems on the verge of a new spurt, buttressed by high economic growth in China, India, and the commodity producing countries,'' Morse said.

On Tuesday, the U.S. government's Energy Information Administration cut its forecast for non-OPEC supply growth in the first quarter by 400,000 bpd.

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