"The market is well served and has even started to suffer from oversupply," said Shukri Ghanem, who also acts as the country's oil minister, adding that the Organisation of Oil Exporting Countries (OPEC) aimed to balance supply and demand.

"Prices have lowered and the supply is exceeding demand. The role of OPEC is to maintain the balance," he told AFP ahead of a meeting of the oil cartel in Vienna on Tuesday.

"But we are not going to make decisions before studying the the market situation," the economic committee report and the opinions of member countries, he added.

Oil prices fell below 105 dollars on Friday with Brent North Sea crude for delivery in October dropping 1.45 dollars to 104.85 dollars a barrel in electronic deals.

New York's main contract, light sweet crude for October, fell 1.49 dollars to 106.40 dollars a barrel.

OPEC will meet amid speculation that the group, which produces 40 percent of the world's oil, may decide to cut output as prices edge toward 100 dollars.

Many analysts expect oil prices to continue to fall because of fears of recession in the United States and Europe.

Crude oil, which hit a record high 147.27 dollars on July 11 in New York, has lost nearly 40 dollars in less than two months.

Oil prices had broken through 100 dollars a barrel for the first time at the start of January on geo-political concerns, notably surrounding the ongoing nuclear power dispute between the West and Iran, which is a major producer and exporter of crude oil.

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