'No disruption in oil supply'
The International Energy Agency said yesterday it sees no reason to release emergency crude oil stocks despite the situation in Iraq. "There is no event in Iraq that makes us fear about a disruption in oil supply," IEA spokesman Pierre Lefevre said.
On Thursday, soon after US-led troops launched an invasion of Iraq, the Paris-based energy watchdog said increased production from OPEC kingpin Saudi Arabia and key member Venezuela, combined with lower demand for heating oil in the US, helped to reinforce confidence that demand would be met.
The IEA has said it will allow the Organization of Petroleum Ex-porting Countries to have first crack at supplying customers before the IEA takes a decision to release stocks.
OPEC Secretary-General Alvaro Silva Calderon told a news conference on Thursday at the group's headquarters in Vienna that members have been authorized to exceed their output quotas if they decide on their own that such a step is necessary. No new meeting would be needed, he said.
Saudi Arabia, the OPEC member with the greatest excess capacity, indicated it was ready to raise production but did not specify whether that would be in the context of an overall agreement.
Iraq's oil exports through the United Nations' oil-for-food program, normally around 1.7 million barrels a day, are now at a standstill following the withdrawal of UN staff from Iraq on Tuesday.
Markets seemed to take comfort from the speed of the US-British advance and shrugged off the latest news of an increased number of Iraqi oil well fires. The lack of an impact from the war on oil shipments from Kuwait also inspired confidence.
Crude prices retreated in early trading yesterday despite the British government's confirmation of fires at 30 Iraqi oil wells.
May contracts of North Sea Brent, Europe's benchmark price for crude, fell as much as 70 US cents to US$24.80 a barrel on London's International Petroleum Exchange.
Contracts of US light, sweet crude for May delivery were 67 US cents lower at US$27.45, in electronic, pre-session trading in New York.
On the stock market, European stocks in yesterday's morning session headed for their biggest weekly gain since September 2001, based on traders' optimism that the Iraq conflict will be resolved quickly and consumer confidence should be boosted and capital expenditure might follow.
On Thursday, European Union leaders drafted a new commitment to create jobs and push through reforms in an attempt to make the EU the world's most competitive economy by 2010.
The draft statement reiterated the need to make it easier for Europe's employers to hire and fire workers, and to create new tax benefits to encourage competitive practices.
It said EU leaders would form what it called an "employment taskforce" to seek further reforms designed to create more and better jobs. Media reports said the taskforce would be headed by former Dutch Premier Wim Kok.
Leaders also planned to restate their longstanding commitment to open up the electricity, gas, railway and financial markets to competition.
The summit acknowledged the EU's previous failure to implement past pledges on such practical reforms, but vowed this time to follow through on their commitment.