OPEC resolves to keep oil supplies flowing to the West

www.theage.com.au March 13 2003 By Neela Banerjee Vienna

The Organisation of Petroleum Exporting Countries decided at its meeting in Vienna, Austria, to maintain oil output at current levels, indicating it could do little else to cope with the uncertain impact a possible war in Iraq could have on supplies from the Persian Gulf and global demand.

At its last meeting in January, OPEC raised production levels to 24.5 million barrels a day. But industry analysts think OPEC is producing more than that, with nearly all countries, except for Saudi Arabia, pumping at maximum capacity to calm a market shaken the past few months by export shortages from Venezuela and jitters over war.

OPEC president Abdullah bin Hamad al Attiyah, of Qatar, acknowledged that although the 10 voting OPEC members were taking a wait-and-see approach, the group was prepared to act quickly to produce even more oil within weeks to prevent supply shortfalls and steep jumps in prices.

"We will closely monitor market developments," Mr Abdullah said at a news conference after the formal meeting on Tuesday, "and take prompt and appropriate action as and when the need arises."

OPEC does not disclose its actual production, and Mr Abdullah and others would say only that the group's excess production capacity is 2 million to 4 million barrels a day above the official quota. It is unclear how much of that has already been tapped, though most industry analysts estimated that perhaps only a million barrels a day of spare capacity remained within OPEC, nearly all of it in Saudi Arabia.

-New York Times