	opec output in may seen over ceiling at mln bpd london june opec s may output appears to have risen well above its mln bpd ceiling to mln bpd and the increase is likely to put a short term lid on spot oil prices kleinwort grieveson securities says but kleinwort s latest world oil report said re stocking and lower non opec output earlier this year should allow the group to produce up to mln bpd in the current third quarter on the supply demand front the market continues to enjoy a degree of stability rarely seen in recent years it said it said most opec members were overproducing slightly but only the united arab emirates uae was seriously above quota the report said saudi arabia had been sending clear signals on the need to maintain oil prices at current levels of around dlrs a barrel and adopt provisional output rises agreed in december when opec meets in vienna on june if opec adopts the provisional ceilings of mln bpd in third quarter and mln bpd in the fourth there will probably be room for overproduction in the third quarter when demand for its  will probably be to mln it said it said that the uae and ecuador may demand higher quotas in vienna but the biggest obstacle is iraq which has refused to honour its quota as it is less than that of gulf war enemy iran but opec appears committed to a short meeting and realises something must be done about the iraq issue the report said according to kleinwort s sources saudi arabia has already held separate talks with iran and iraq and is urging iraq to be more moderate one strong indication that some kind of deal may be eventually worked out is the almost complete silence coming from iran it said indications are that in return for going along with the saudi desire to maintain official prices in vienna iran is seeking concessions from the kingdom on the iraq issue it said kleinwort said the kingdom will face an increasingly uphill task in trying to maintain prices around dlrs beyond firstly opec hardliners led by iran are bound to oppose such a move secondly other opec members will press for another price rise if the dollar remains weak against other currencies thirdly saudi arabia may be forced to raise prices earlier than it intended to ward off growing calls for higher prices from the u s to stimulate domestic drilling and exploration the report concluded that there is a strong possibility official opec prices will rise to dlrs a barrel by end and dlrs a barrel by end reuter 
