* Saudi deputy oil minister says market has enough supply
* Libya, Iran top oil officials not expected to attend IEF
* Oil price hits highest in 2-1/2 years
(Updates prices, adds comment)
By Amena Bakr and Asma Alsharif
RIYADH, Feb 21 World markets have plenty of oil,
top exporter Saudi Arabia said on Monday, as a wave of
revolution that has already toppled two presidents tightened its
grip on OPEC member Libya and drove prices to a 2-1/2 year-high.
Energy ministers arrived in the Saudi capital Riyadh on the
eve of talks designed to narrow the gap between producer and
The formal agenda could be overwhelmed by concern
anti-government protests will drive oil prices still higher.
Oil on Monday climbed above $106 LCOc1 as energy firms
recalled international staff from Libya and spreading unrest
shut down some 100,000 barrels per day (bpd) of production
there. [ID:nLDE71K1NE] [O/R]
It was the first output disruption since popular unrest
erupted in Tunisia, ousting its president, before spreading to
Egypt, where it unseated Hosni Mubarak after 30 years of rule.
Libyan leader Muammar Gaddafi's four-decade-rule also
appeared in jeopardy as protests reached the capital Tripoli for
the first time. [ID:nLDE71K01F]
Saudi Oil Minister Ali al-Naimi will open proceedings at the
International Energy Forum with a speech on Tuesday, but
declined to comment to reporters on Monday.
His deputy Prince Abdulaziz bin Salman Al-Saud told a news
conference on Monday the market had plenty of oil.
"We're much more focused on how the market balance is, is it
sufficiently supplied? And the answer is 'yes, abundantly,'
therefore does the situation warrant any kind of intervention? I
don't think so," he said.
He also reiterated the long-held Saudi view $70-$80 was the
fair price for oil
"It is justified because it enables producers to invest, it
is justified because it does not harm consumers."
Even though oil prices are well above those levels, OPEC
ministers have repeatedly said the market has enough supply and
the Organization of the Petroleum Exporting Countries has no
plans to meet formally to reassess output until June.
IRAN, OTHERS STAY AWAY
Iran, OPEC's second largest oil producer after Saudi Arabia
and holder of the rotating OPEC presidency, was among several
oil ministers who will stay away from Tuesday's talks, delegates
His anticipated absence was interpreted as another clue OPEC
was not ready to react to rising oil prices with a formal output
The group's supply policy has been unchanged since December
2008 when it agreed a record output cut of 4.2 million barrels
Initially, it implemented the policy agreement rigorously,
but as the oil market has risen, OPEC members have increasingly
produced above their output targets.
They are now delivering only around half the promised curbs.
Libya's most senior oil official Shokri Ghanem was also
expected to be absent from Riyadh, although his fellow
countryman Abdullah Al-Badri, OPEC's secretary general, arrived
there late on Monday.
He told reporters he would not answer questions until
Even if OPEC does not add any oil to the market, Saudi
Arabia has around 4 million barrels per day (bpd) of spare
capacity and has said it is always ready to supply extra oil in
case of need.
Its output has been steadily increasing to well over 8
million bpd, although its exports have not. [ID:nLDE71F1TA]
Fellow Gulf producer the United Arab Emirates also said OPEC
was ready to add oil if there was a need, but that the market
was well-supplied. [ID:nLDE71K2AA]
Saudi Arabia's established policy of price moderation and
ability to add oil to the market at short notice has underpinned
a decades-long relationship with the world's biggest oil
consumer the United States.
The United States will be represented at Tuesday's talks by
Deputy Energy Secretary Daniel Poneman.
Asked by reporters on arrival whether he was worried about
current price levels, Poneman said only: "We believe in the laws
of supply and demand."
Take a Look on [ID:nLDE71G1J8]
Graphic on Saudi crude output, exports, stocks:
Graphic on U.S. crude oil in different currencies:
Graphic on Brent crude oil in different currencies:
(Additional reporting by Reem Shamseddine and Humeyra Pamuk)
(Writing by Barbara Lewis, editing by William Hardy)