Major oil cartel OPEC may consider increasing output for the first time in 4 years to ease prices and lessen the drag of high energy costs on global economic growth.

According to a prominent member of the Organization, there is a need for an increase to replace the loss from Libya as oil prices are too high and is scaring people.

OPEC, which pumps more than a third of the world’s oil, may raise supply targets by as much as 1.5 million barrels per day (bpd) when ministers meet on June 8.

The 11 members of the group bound by OPEC production targets pumped 26.23 million bpd in May, nearly 1.4 million bpd above their 24.84 million bpd target.

Raising formal output targets would force OPEC to confront tough issues aside from overproduction. Top oil exporter Saudi Arabia holds most of the group’s spare capacity so is likely produce most of any extra oil supply.

Other members would be reluctant to cede their theoretical share of any supply target increase, even if they are already at full capacity.

OPEC members Iran, Libya and Venezuela could resist any rise in targets, industry publication Energy Intelligence reported on Wednesday, citing an OPEC insider.

Source: Commodity Online