Indonesia urges fellow OPEC nations to raise supply
www.forbes.com Reuters, 01.23.03, 12:23 AM ET
JAKARTA, Jan 23 (Reuters) - Indonesia's Mines and Energy Minister Purnomo Yusgiantoro called on Thursday for OPEC to increase oil supply to try to bring down soaring world oil prices.
He said Indonesia, Asia's only member of the Organisation of the Petroleum Exporting Countries, wanted prices to return to within OPEC's target band of $22-$28 a barrel as measured by the cartel's basket of crudes.
"The price is above $30 a barrel and it is still high. We appeal to OPEC countries to lift production and to supply more to the market," Purnomo told reporters.
"As long as the price remains above the OPEC range, we will support an increase in supply from OPEC," he added.
On Wednesday, Saudi Arabia's ambassador to the United States said the kingdom, OPEC's biggest producer, was willing to seek an increase in the cartel's supply.
"Our government is ready to do more in the next two or three weeks if we see the price is not stabilising and going down below $28," Prince Bandar Bin Sultan told a meeting of the U.S. Conference of Mayors.
The price of OPEC's basket of seven crude oils fell to $30.90 a barrel on Tuesday from $31.21 on Monday, the OPEC news agency said on Wednesday.
Oil prices have surged on growing fears of war in Iraq, an OPEC member and the eighth biggest exporter in the world, at the same time that the oil industry in Venezuela -- a major supplier to the United States -- has been crippled by a general strike.
Benchmark NYMEX crude hit $35.20 a barrel on Tuesday, its highest price since November 2000.
Purnomo did not say whether Indonesia could increase its supply to the market but mines and energy officials have said the country does not have additional production capacity beyond current output levels.
Indonesia produced 1.05 million bpd of crude oil and 149,000 bpd of condensate in December.
At an emergency meeting in Vienna on January 12, OPEC agreed to increase production by 1.5 million barrels per day (bpd) to 24.5 million bpd, to help quell rising oil prices. The output increase is effective February 1.
Indonesia on Monday succumbed to pressure of nationwide protests and cut price hikes on some domestic oil products.
"We will defend current domestic oil products prices until the world crude oil price is stable," Purnomo said.