* 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
By Amena Bakr and Asma al-Sharif
RIYADH, Feb 21 (Reuters) - Oil markets have abundant
supplies, 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 were arriving in the Saudi capital Riyadh
on the eve of talks designed to narrow the gap between producer
and consumer nations.
The formal agenda could be overwhelmed by concern
anti-government protests will drive oil prices still higher.
Oil on Monday climbed above $105 as energy firms recalled
international staff from Libya and spreading unrest shut down
some 100,000 barrels per day (bpd) of production there.
It was the first output disruption since a wave of
anti-government 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.
Saudi Oil Minister Ali al-Naimi will open proceedings at the
Inernational 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 producters 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 was well-supplied 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 expected to stay away from Tuesday's talks.
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 50 percent of the
Libya's most senior oil official Shokri Ghanem was also
expected to be absent, although his fellow countryman Abdullah
Al-Badri, OPEC's secretary general, arrived in Riyadh late on
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, although its
exports have not.
Saudi Arabia's established policy of price moderation and
ability to add oil to the market in times of need 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."
(Additional reporting by Reem Shamseddine and Humeyra Pamuk)
(Writing by Barbara Lewis, editing by William Hardy)
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