Wednesday, December 21 2005 15:40 Hrs (IST) - World Time -

Kuwait City: Oil prices are expected to remain stable and trade within a defined range, OPEC's chief said today (Dec 21,2005), adding that the cartel's stocks could reach a 55-day reserve in the next three months.

"Prices as we see them remain within a defined range that they have not breached," Sheikh Ahmad Fahd al-Sabah, also Kuwait's energy minister, said before leaving on a trip to Russia and China.

He said the powerful 11-nation Organisation of Petroleum Exporting Countries will allow its stocks of oil to build up to a reserve of 54 to 55 days over the next quarter.

"We are allowing the stocks to build up for that we believe the stocks will build up for about 54 to 55 days in the next three months," he said.

OPEC's production quota stands at 28 million barrels per day (bpd) and it decided at a meeting in Kuwait on December 12 not to renew its offer for emergency extra output of two million bpd.

The cartel will meet again on January 31 in Vienna to assess an expected seasonal drop in demand for energy between April and September, with a possible cut in output on the cards.

At the same time, a factor that may distort the traditional seasonal slump in energy requirements is the oil-guzzling economies such as China and India.

OPEC released a report five days ago saying that world demand for oil will increase by 1.9 percent in 2006 to 84.9 mbpd with booming China accounting for more than one fifth of the increase of 1.6 million over 2005.