The Opec oil cartel has decided to keep its output unchanged but warned that the group would act if oil prices fell.

The decision was widely expected because oil prices have been trading at about $70 a barrel, the lower end of the cartel’s target.

In its statement explaining its decision, Opec said: ”Whilst there are signs that economic recovery is under way, there remains great concern about the magnitude and pace of this recovery, especially in the major industrialised nations of the OECD.”

Opec added that the excess oil supply stored in inventories had eased slightly, but that fundamental market conditions remained weak, refineries were operating at low rates and petroleum product inventories had risen.

The cautious language indicates that Opec will keep a close watch on the markets and act quickly if prices begin to tumble, as some analysts forecast could happen.

But Abdalla Salem El-Badri, Opec’s secretary-general, also indicated that Opec was well aware that driving prices higher could be counter-productive: ”The recession is in its final period and we hope that by the beginning of the next quarter in 2010 we will see the end of the recession, which will be good for everyone.”

He added: ”We are walking on a very thin line. We don’t want to take action that could threaten the recovery. We don’t want them to penalise us because we are oil producers. We cannot shift the responsibility of cleaning up the world on the developing countries.”

Opec produces about one third of the world’s oil. The group last year announced a series of cuts totalling 4.2m barrels a day. Though the group has not fully adhered to those reductions, the campaign has been largely successful because it has driven oil prices from $32 a barrel to about $70 today.

Opec thinks an oil price of between $70 and $80 works in everyone’s interest as it allows producers to invest in new oil projects – important for future production – and consuming countries’ economies to recover.