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Friday, April 25, 2003

Opec to Meet Thursday Over Oil Prices

URL Daily Trust (Abuja) April 22, 2003 Posted to the web April 22, 2003

OPEC confirmed Monday that it will hold an emergency meeting April 24 in Vienna to discuss cutting supplies in response to a sharp drop in world oil prices.

Despite a halt in Iraqi exports due to the U.S.-led war on Baghdad, prices have slumped by 30 percent in a month on a rising tide of exports from U.S. ally Saudi Arabia and other cartel members. Check out allAfrica's debate on the election in Nigeria. Click here.

"It's definitely the 24th," an OPEC spokesman said, clearing up uncertainty over possible dates for the meeting.

Algerian Oil Minister Chakib Khelil said Monday that OPEC could stop prices falling further simply by improving compliance with its agreed ceiling of 24.5 million barrels per day (bpd), as the cartel is now pumping some two million bpd above that.

Other members could push for a cut in formal quota limits.

The Arab-dominated cartel will also discuss the return of Iraqi exports after the war, although this is unlikely to affect quotas yet.

OPEC President Abdullah al-Attiyah said last week that oversupply on world markets already topped two million bpd, and could reach four million with the return of Iraq in the months ahead.

Countering this view, Algeria's Khelil said any decision by OPEC now should take into account an expected demand rebound in the summer which could see prices rise again.

Commercial oil stocks worldwide are well below normal levels due to a series of supply interruptions from Venezuela, Nigeria and Iraq, although they have shown some signs of recovery in recent weeks.

Despite the sharp fall in prices, OPEC's reference price is now hovering around OPEC's target level of $25 per barrel, having topped $33 last month.

Saudi Arabia stepped in to cover for the Iraqi stoppage, and now accounts for three-quarters of OPEC's output above quota. Its view will be crucial.

Oil industry think-tank, the Center for Global Energy Studies, said Saudi Arabia could even seek to retain most of its recent output surge by negotiating cuts on the basis of current output, instead of quotas.

This would provoke a storm of protest from other members, who are all keen to protect their market share.

When Iraqi sales do resume, analysts believe they will rise gradually and take several months to regain their pre-war level of 2.5 million bpd.

OPEC will probably give Baghdad freedom to pump at will until it reaches its historical quota level above three million bpd, which Iraqi experts expect to take several years.

Before Iraq's invasion of Kuwait in 1990, Baghdad had the same quota level as Iran at 3.1 million bpd. Iran's quota has since risen to 3.6 million.

U.S.-backed Iraqi exiles formulating postwar oil policy for Iraq think it will take three or four years to regain output capacity of 3.5 million bpd, according to briefing papers obtained by Reuters.

Opec to Meet Thursday Over Oil Prices

URL Daily Trust (Abuja) April 22, 2003 Posted to the web April 22, 2003

OPEC confirmed Monday that it will hold an emergency meeting April 24 in Vienna to discuss cutting supplies in response to a sharp drop in world oil prices.

Despite a halt in Iraqi exports due to the U.S.-led war on Baghdad, prices have slumped by 30 percent in a month on a rising tide of exports from U.S. ally Saudi Arabia and other cartel members. Check out allAfrica's debate on the election in Nigeria. Click here.

"It's definitely the 24th," an OPEC spokesman said, clearing up uncertainty over possible dates for the meeting.

Algerian Oil Minister Chakib Khelil said Monday that OPEC could stop prices falling further simply by improving compliance with its agreed ceiling of 24.5 million barrels per day (bpd), as the cartel is now pumping some two million bpd above that.

Other members could push for a cut in formal quota limits.

The Arab-dominated cartel will also discuss the return of Iraqi exports after the war, although this is unlikely to affect quotas yet.

OPEC President Abdullah al-Attiyah said last week that oversupply on world markets already topped two million bpd, and could reach four million with the return of Iraq in the months ahead.

Countering this view, Algeria's Khelil said any decision by OPEC now should take into account an expected demand rebound in the summer which could see prices rise again.

Commercial oil stocks worldwide are well below normal levels due to a series of supply interruptions from Venezuela, Nigeria and Iraq, although they have shown some signs of recovery in recent weeks.

Despite the sharp fall in prices, OPEC's reference price is now hovering around OPEC's target level of $25 per barrel, having topped $33 last month.

Saudi Arabia stepped in to cover for the Iraqi stoppage, and now accounts for three-quarters of OPEC's output above quota. Its view will be crucial.

Oil industry think-tank, the Center for Global Energy Studies, said Saudi Arabia could even seek to retain most of its recent output surge by negotiating cuts on the basis of current output, instead of quotas.

This would provoke a storm of protest from other members, who are all keen to protect their market share.

When Iraqi sales do resume, analysts believe they will rise gradually and take several months to regain their pre-war level of 2.5 million bpd.

OPEC will probably give Baghdad freedom to pump at will until it reaches its historical quota level above three million bpd, which Iraqi experts expect to take several years.

Before Iraq's invasion of Kuwait in 1990, Baghdad had the same quota level as Iran at 3.1 million bpd. Iran's quota has since risen to 3.6 million.

U.S.-backed Iraqi exiles formulating postwar oil policy for Iraq think it will take three or four years to regain output capacity of 3.5 million bpd, according to briefing papers obtained by Reuters.

I have no qualms with VHeadline.com and celebrate really independent reporters

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Tuesday, April 22, 2003 By: Francisco Rivero

Date: Mon, 21 Apr 2003 20:19:20 -0400 From: Francisco Rivero riverofjr@hotmail.com To: Editor@VHeadline.com Subject: In response to Mrs. Dawn Gable

Dear Editor: Mrs. Gable claims she really knows what’s going on in Venezuela ... she has spent several months before and after April 11, 2002 ... she has visited us several times since ... she has traveled extensively, spoken to many people and witnessed first hand what is really happening here.

She discredits Mr. Labartino better claim to really know what’s going on in Venezuela to his gullible appetite for propaganda ... with a single stroke she disqualifies every thinking Venezuelan who dares to risk a divergent opinion on what’s is really going on in Venezuela ... she apparently knows best!

It is sad and worrisome that there still are around so few people such as Dawn Gable who are too prone to believe their own lies and half-truths, and so quick to talk about the responsibilities and accountability that come with acknowledging the truth and acting upon it.

As a Venezuelan I have no qualms with VHeadline.com and celebrate really independent reporters who are not afraid to tell the truth, whatever it may be ... I very much doubt Mrs. Gable fits the profile.

Francisco Rivero riverofjr@hotmail.com

Opec urges members to respect quotas

April 22, 2003 By Sapa-AFP

Vienna - Opec, faced with falling oil prices in the wake of the Iraq war, is to call on its members to respect production quotas, an Opec official said on Tuesday.

The official said ministers from Opec's 11 member states would call at a meeting Thursday in Vienna for the cartel to hold to its current quota of 24.5 million barrels per day (bpd).

But analysts in Singapore said deciding how output should be reduced, and by whom, could prove difficult.

In London, oil prices held steady in early trading Tuesday. Reference Brent North Sea crude for June delivery fell seven cents to $25.78 a barrel in early deals.

New York's benchmark light sweet crude contract for May slipped 20 cents to $30.63 a barrel during out-of-hours electronic trading.

Traders said that fluctuations in the US price were largely caused by technical factors associated with the expiry of the May contract on Tuesday.

"The oil market is waiting to see what happens at the Opec meeting later this week," said analyst Andrew Whittock at Williams de Broe.

It remained uncertain what the cartel might decide on, said GNI trader Paul Goodhew.

"People are kind of expecting a cut of production of around one (million) to 1.5 million barrels per day, but what Opec actually gives us remains to be seen," he said.

Over the weekend, the president of the Organization of Oil Producing Countries, Abdullah bin Hamad al-Attiyah, said that the group must act to curb a surplus of two million barrels a day on the market since the Iraq war.

However, a dealer in Singapore with a regional trading firm, commented: "They (Opec) should not complain too much since oil prices have held at relatively high levels ."

Among the factors clouding the group's deliberations will be the continuing uncertainty over when Iraqi oil exports are most likely to resume.

Opec had announced in January an output increase, raising its combined output ceiling by 6.5 percent to 24.5 million bpd, to curb a surge in prices triggered by a strike in Venezuela and the threat of war in Iraq.

Since then, Opec members have produced over the quota as the price of oil soared up to $40 per barrel.

There is concern now that oil prices could collapse due to oversupply.

A return to the quota "is the most likely scenario" to seek to adjust prices, the Opec official said.

Opec seeks to have oil prices within a band of $22-$28 per barrel.

With Iraq's oil exports expected to begin flowing again following the US-led war to unseat the regime of Saddam Hussein, Opec has been anxious to avoid a plunge in global prices through oversupply.

However, analysts said there were fresh concerns over supplies from Nigeria, where violence has flared following a disputed presidential election.

Nigerian soldiers shot dead eight opposition supporters after coming under fire during an election day protest at the weekend, a police spokesman told AFP on Tuesday.

Last month around a third of all Nigeria's oil exports were halted due to civil and political unrest. - Sapa-AFP

New Report Shows U.S. Proximity Aids Latin Economies

Daily Research News On Line

The ‘2003 Latin American Marketing Report,’ published this week by Strategy Research Corporation (SRC), now part of Synovate, presents buying power estimates for 18 countries, plus Puerto Rico, and 70 metropolitan markets across Latin America. According to Rick Tobin, president of SRC and co-author of the report, a few islands of economic brightness have surfaced in an ocean of South American gloom. Latin American nations located closest to the United States appear to have fared better in general than those furthest from the U.S., according to Dr. Adolfo Chiri, SRC's chief economist, the report's other co-author.

Argentina, Uruguay, Paraguay and Venezuela (a notable exception to the ‘proximity’ rule) led the 10% downturn in consumer buying power in Latin America, estimated to total $1.2 trillion.

While the combined economies for the region are not experiencing growth, there are some obvious winners and losers. Puerto Rico and Mexico have the highest levels of average buying power per household, among the 125 million Latin American households, the report says. Twenty-two percent of Mexicans and 21% of Costa Ricans feel they are personally better off economically than in the previous year, while 64% of Latin Americans feel that their personal economic situations are worse than the year before.

Optimistically, 58% of Latin Americans expect their personal economic situations to be the same or better next year. At the same time, 54% of Latin Americans consider that their countries' economic situations will be the same or better next year, while 38% believe their country's economic situations will be worse. It is important to note that Argentina experienced a 62% decline in consumer buying power this year, while other countries, including Ecuador, experienced an 18% growth in buying power for the same period.

Twenty-five percent of Latin American households report doing grocery shopping daily. Sixty percent prefer grocery shopping in supermarkets, while 28% shop for groceries in traditional markets. Interestingly, shoppers are influenced most by quality, rather than price or taste when making their purchasing decisions.

Unemployment and security are among the leading problems that concern Latin Americans, while urban transportation and fixed phone services are the services with which Latin Americans are least satisfied.

In electronic services, 85% of Latin American households connected to the Internet do so by dial-up connection. Seventy-five percent of Internet users use it primarily for e-mail, while 63% report using online banking for paying bills. Latin Americans listen to the radio an average of 19 hours per week.

Further information is available at www.strategyresearch.com