Nov. 28 (Bloomberg) -- OPEC ministers, arriving in Cairo for a meeting tomorrow, said they may delay a decision on production levels until December as they assess the impact of their last supply cut amid falling demand.

“Now we are preparing the data and we will take the final decision in Algeria,” Iranian Oil Minister Gholamhossein Nozari said at his hotel in Cairo. Saudi Oil Minister Ali al-Naimi declined to speak as he arrived in Egypt today.

Kuwaiti Oil Minister Mohammed al-Olaim and his counterparts from Qatar and Angola also said the group would probably wait until its Dec. 17 conference in Oran, Algeria, before making a final decision. OPEC agreed last month to reduce production quotas by 1.5 million barrels a day.

The 13 members of the Organization of Petroleum Exporting Countries, which supply more than 40 percent of the world’s oil, are meeting for the third time in as many months to discuss a further cut in production after crude prices plunged 65 percent from July’s record of $147.27 a barrel in New York.

“The market is very related to the global economic crisis,” Qatari Oil Minister Abdullah bin Hamad al-Attiyah said after arriving at Cairo airport today. “There’s pressure on demand.”

Crude oil for January delivery declined 1 cent to settle at $54.43 a barrel at 1:47 p.m. on the New York Mercantile Exchange.

Waiting three weeks will give OPEC “a better chance to assess how effective they have been themselves in implementing the cuts,” Mike Wittner, head of oil market research at Societe Generale SA in London, said in a Bloomberg Television interview. “The Saudis and some of the other more moderate gulf countries will say the cuts only took effect on Nov. 1, let’s at least give ourselves a month to see how we did.”

Cairo Cut Unlikely

OPEC won’t make a cut at tomorrow’s meeting mainly because it doesn’t yet know how much oil output has been taken off the market from its previous reduction, and some are still exceeding quotas, said an OPEC delegate in Cairo who declined to be identified because the decision is not yet official.

The 11 OPEC states subject to output quotas will produce 27.8 million barrels a day in November, according to Geneva-based consultant PetroLogistics Ltd., which is in excess of their official limit of 27.3 million barrels a day.

The Cairo gathering, originally intended just for ministers from Arab nations, was expanded into a full OPEC “consultative meeting” including countries such as Venezuela, Iran and Angola.

Venezuela

“If OPEC producers agree to cut production, we will support it,” Venezuelan Oil Minister Rafael Ramirez said today in Cairo. Venezuela is “concerned” the oil market is oversupplied, he said, adding that “stocks are very high.”

Ramirez’s comments were echoed by United Arab Emirates Oil Minister Mohamed al-Hamli, who said the market is “certainly oversupplied.”

Kuwait’s al-Olaim said in Cairo that oil inventories are rising and a decision “could be taken” later, in Algeria.

“There is a surplus on the market,” al-Olaim said earlier today at Kuwait airport. “Everybody knows that. The decline in demand is there and it is a big amount” because of the slowdown in the global economy.

“At this meeting maybe we will not see a cut because we still need to see more information” on the market, which may not be available for another two weeks, he said. “We have to take a decision, a firm and reasonable decision, but we have to take it a little bit later.”

New Year Resolutions

Since exporting nations typically arrange oil sales several weeks in advance, there’s only a “slim” chance that OPEC will initiate a further reduction in physical crude supply before January, Catherine Hunter, an energy analyst at consultant Global Insight Inc., said in a report today. “This makes the meeting more about New Year’s resolutions, rather than the immediate present.”

OPEC produced 32.18 million barrels of crude a day in October, according to Bloomberg estimates, including the 11 members with quotas, plus Iraq and Indonesia, which are exempt.

“I am not expecting any earthshaking decisions,” said Nigerian Minister of Petroleum H. Odein Ajumogobia. “This is a consultative meeting.”

“I don’t expect a decision here,” Angolan Oil Minister Jose Maria Botelho de Vasconcelos said today in Cairo. “I expect one in Algeria.”

Economic reports this week showed a deepening recession in the U.S., the world’s largest oil user. Consumer spending slumped the most in seven years and orders for durable goods including refrigerators and washing machines declined twice as much as forecast, the Commerce Department said Nov. 26.

Eleven years ago, OPEC members bickered over quotas as oil prices slid 28 percent in 10 months amid the onset of the Asian financial crisis. At a meeting in Jakarta in November 1997, they raised quotas, even as economic turmoil in Asia was slowing demand and prices fell another 44 percent by December 1998 to a low of $10.35 in New York.

“We have seen this cycle before, just nine years ago the price was below $10,” al-Attiyah said today. “For the last 20 years this is a normal cycle, but we will come back.”

To contact the reporters on this story: Fred Pals in Cairo at fpals@bloomberg.netAyesha Daya in Cairo at adaya1@bloomberg.net

Last Updated: November 28, 2008 15:26 EST