It is widely expected that the OPEC meeting in Vienna on Monday will call for production to remain at current levels. An $11 drop in prices since the Lebanon cease fire may encourage some to push for cuts further out.
OPEC production is at the highest level since 1979 to cushion against supply shocks. The Saudi-driven policy has succeeded with refiners storing away OPEC crude.
Though oil has dropped from record highs of $78.40, it is still above the $61 price at the start of the year and $20 at the start of 2002.
With the hurricane season and the end of winter still to get through there seems to be no reason for agressive calls for cutting oil production.
But some OPEC members are looking to 2007 when demand could drop sharply if independent producers bring on projects of new crude and slowing economic growth would furher erode demand for OPEC oil.
OPEC economists predict a drop of 800,000 bpd in the requirements for the group's oil.
OPEC's production ceiling was set at 28 million bpd and output this year has run just below the official limit with everyone of the 10 members save Saudi pumping flat out.
Riyadh pumping at about 9.2 million bpd holds most of OPEC's spare production capacity with more than 2 million bpd in reserve.
While the kingdom has supplied the customers with what they want, it has refused to discount barrels to force feed the market and depress prices.
Iran's deputy oil minister and oil minister said they expect OPEC to keep oil production steady when it meets to chart output policy. Their sentiments echoed those of Algerian Energy and Mines Minister.
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