Saudi campaign for OPEC output rise gathers pace
Wednesday, 12 September 2007
VIENNA, Sept 11 (AFP): OPEC ministers head into crunch talks about the cartel's output today, with signs that the group might bend to the will of Saudi Arabia and increase production.
Oil prices in New York closed within striking distance of their record high of 78.77 dollars Monday, with analysts warning that inaction by the Organisation of Petroleum Exporting Countries could send prices above 80 dollars.
A majority of ministers have rejected pressure from consuming nations for higher supplies, but the Saudi kingdom, the biggest producer in the 12-member cartel, may still prevail with a campaign for an increase of 500,000 barrels per day, analysts believe.
In an indication that some members are now willing to concede to an increase, Kuwaiti Acting Oil Minister Mohammad al- Olaim told reporters Monday: "We have to take our responsibility as producers."
He added: "We have to take care of them (consumers), as they take care of us."
Kuwait had previously dismissed demands for a production increase, along with most of the other OPEC members, arguing that the market was adequately supplied.
High oil prices have become an added burden for the world economy in addition to financial market turbulence and a crisis in the US "subprime" housing market.
Saudi Arabia is believed to be worried that high oil prices could drag on economic growth, which would reduce demand for oil in the long term.
Oil prices spiked higher Monday in New York and London, with New York prices at 77.49 dollars and London above 75 dollars.
Algerian Energy Minister Chakib Khelil, arriving late Monday, also opened the door to an output hike, acknowledging the danger of supply shortages heading into the peak demand period for oil in the northern hemisphere winter.
Oil prices in New York closed within striking distance of their record high of 78.77 dollars Monday, with analysts warning that inaction by the Organisation of Petroleum Exporting Countries could send prices above 80 dollars.
A majority of ministers have rejected pressure from consuming nations for higher supplies, but the Saudi kingdom, the biggest producer in the 12-member cartel, may still prevail with a campaign for an increase of 500,000 barrels per day, analysts believe.
In an indication that some members are now willing to concede to an increase, Kuwaiti Acting Oil Minister Mohammad al- Olaim told reporters Monday: "We have to take our responsibility as producers."
He added: "We have to take care of them (consumers), as they take care of us."
Kuwait had previously dismissed demands for a production increase, along with most of the other OPEC members, arguing that the market was adequately supplied.
High oil prices have become an added burden for the world economy in addition to financial market turbulence and a crisis in the US "subprime" housing market.
Saudi Arabia is believed to be worried that high oil prices could drag on economic growth, which would reduce demand for oil in the long term.
Oil prices spiked higher Monday in New York and London, with New York prices at 77.49 dollars and London above 75 dollars.
Algerian Energy Minister Chakib Khelil, arriving late Monday, also opened the door to an output hike, acknowledging the danger of supply shortages heading into the peak demand period for oil in the northern hemisphere winter.