Saudi Has Not Hiked Production: OPEC Kuwait Times (Kuwait City)

July 21, 2000

Caracas - The president of the Organisation of Petroleum Exporting Countries said yesterday Saudi Arabia hasn't unilaterally raised its oil production, nor does it plan to.

Speaking at a press conference together with Opec Secretary General Rilwanu Lukman, Ali Rodriguez said he expects oil prices to stabilise next month. Rodriguez, who is also Venezuela's oil minister, added that he couldn't "discount" another adjustment in Opec's production this year.

Lukman, who declined to comment on "speculation' that Saudi Arabia has already brought fresh oil to market, said the organisation would act on market fundamentals, not speculation. He said there is no "disarray" within Opec and insisted the cartel acts in unison to stabilise market prices.

Saudi Oil Minister Ali Naimi said early this month that 500,000 barrels a day of extra oil would be pumped into the market to deflate current high oil prices. Saudi Arabia's national oil company, Aramco, has reportedly told buyers than an extra 500,000 barrels a day is forthcoming.

Rodriguez said yesterday he had assurances from Naimi that Saudi Arabia "will not take any unilateral action." He said the "rumours" about Saudi Arabia's intentions are a "campaign to discredit Opec."

"I don't have the slightest doubt that there are people interested in debilitating Opec, including, painfully, people in Venezuela who spread rumours and false analyses," Rodriguez said.

Dow Jones Newswires cited an unidentified Opec official yesterday as saying that Saudi Arabia remains committed to a $25 per barrel Opec basket price.

Despite insistent Opec attempts to downplay Saudi Arabia's stance, no senior Saudi official has said that the Kingdom won't stick to its plan to boost output.

Lukman said yesterday "the market may not need more oil now, as there's a lot of oil coming into the market soon," thanks to a June 21 agreement to boost output by 708,000 barrels a day.

He emphasised that Opec's aim is "price equilibrium," and stressed that Opec "has a tool to use ... when it's necessary," referring to a recently approved price-band mechanism under which Opec automatically adjusts output when prices move beyond a set limit.

Rodriguez said Tuesday the group will restart the clock on its price band, which requires the Opec crude basket price to stay above $28 per barrel for 20 consecutive trading days before production is increased. The price dipped below $28 per barrel Monday.

On Tuesday, the Opec basket price stood at $28.09 a barrel.

Lukman said "all Opec members have an agreement in hand and are committed to the price band." Rodriguez once again criticised market traders for stoking price volatility, suggesting they were fanning "rumours" of an imminent hike in Saudi Arabia's oil production.

Copyright 2000 Kuwait Times

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-- Martin Thompson (mthom1927@aol.com), July 21, 2000

Answers

If we told the TRUE story our global resource consumers might just look for alternitive energy. We could'nt have that now could we?!

-- Christopher Owen (Chris@Chris.com), July 24, 2000.

Right Chris ..... Truth is in the eye of the beholder ; I see $1.75 per gallon for unleadered regular , and politicians don't GIVE A DAMM! They live off our labors , like blood suckers . Eagle

-- Hal Walker (e999eagle@freewwweb.com), July 24, 2000.