By Brai Odion-Esene

WASHINGTON (MNI) - The Organization of Petroleum Exporting Countries has an ample amount of spare oil capacity ready to meet any potential rise in world demand, OPEC officials said Wednesday, dismissing worries about a potential shortage in the near future.

Speaking to reporters at the conclusion of the OPEC conference of member oil ministers in Vienna, OPEC president -- and Ecuador oil minister -- Germanico Pinto was asked if there is any concern among OPEC members of a possible shortfall in oil supplies over the next five years, and he replied that is unlikely to happen.

"We don't see that in the foreseeable future," he said. OPEC Secretary-General Salem El-Badri agreed, noting huge oil reserves held by both OPEC and non-OPEC producers.

"I would like to assure you -- and the rest of the world -- that there is no shortage for the foreseeable future," he said, accusing those who predict oil supplies running out soon of being motivated by commercial reasons -- promoting alternative energy sources.

OPEC has more than 6.6 million barrels per day of spare capacity, El-Badri said, "If the world needs more oil, we are ready to raise it. If we see abnormal circumstances here and there we can increase our production."

El-Badri said OPEC believes the growth seen now in the global economy is primarily due to fiscal stimulus packages, which can be withdrawn at anytime. The group, he said, is waiting to see when governments withdraw fiscal support -- something that he expects to be gradual -- and then what happens to "real growth."

In an opening statement at the start of the meeting, Pinto had noted that the economic recovery is far from self-sustaining in the major OECD countries and fears of double-dip recession remain a threat. "While there has been an improvement in the oil market outlook in recent months, there is still a long way to go before we can feel at ease with the situation," he said.

He added, "Developments in the world economy, which remains balanced on a knife-edge of uncertainty, will continue to have a direct impact on the outlook in the coming months."

"I hope we are out of the woods now," El-Badri told reporters, and that oil price stays in the same $70-$80 range for remainder of 2010. This price range is comfortable for both producers and consumers the secretary-general said, but added that if any negative changes occurred in the oil market before the group's next meeting October 14, it can "meet up anytime" to act.

OPEC, he repeated, does not have a target oil price, but in the current economic climate, producers are "happy" with the $70-$80 range.

OPEC is monitoring the overall global economy, and not just fiscal stimulus programs, Pinto said. There are very clear signs, he said, that the world is coming out of the recession.

"We expect that the situation will get better and better," he added.

The OPEC communique did not contain tough language encouraging stricter compliance by members with production quotas -- something industry observers had expected. When asked about this, OPEC president Pinto said the matter of better compliance was stressed at the meeting.

El-Badri agreed that compliance among OPEC members has been slipping, but said that due to the current path of the world economy, "We try to push (on compliance) but not that much."

The situation in the world economy -- as well as current oil price

"comfortable for everybody."

In its communique, OPEC ministers noted that while the global economy is clearly rebounding from the late 2008 and early 2009 recession, with continued positive signals coming from the manufacturing and services sectors, serious threats remain.

Downside risk, they warned, include: the mounting and potentially unsustainable public debt in the most advanced economies; a degrading fiscal position which might lead OECD governments to tighten fiscal and monetary policy, despite rising unemployment; weak demand; persistent global imbalances; and rising protectionism.

They also voiced concern that, although world oil demand is projected to increase marginally during the year, this rise will be more than offset by the expected increase in non-OPEC supply, meaning that 2010 is likely to witness a decline in the demand for OPEC crude oil for the third consecutive year.

The persistently high OECD stock levels -- estimated to currently stand at 59-61 days of forward cover -- they said, indicate that there has been a contra-seasonal stock build in the first quarter 2010 and the overhang in terms of forward cover is expected to continue throughout the year.

As a result, OPEC again decided to maintain the current oil production ceiling unchanged, with member countries reiterating their commitment to their individually agreed production allocations

"Given the uncertainty in the macroeconomic environment and world oil demand," OPEC said, "the Secretariat will continue to closely monitor developments in the months ahead, keeping Member Countries abreast of developments as they occur."

The situation will then be reviewed at the cartel's next meeting on October 14, 2010.

** Market News International Washington Bureau: 202-371-2121 **