Minister urges Opec to tackle oil oversupply

<a href=www.busrep.co.za>IOL-Business Report April 23, 2003 By Sapa-AFP

Vienna - Opec should move first to rein in supply on the world oil markets by getting its members to respect current production quotas, United Arab Emirates (UAE) Oil Minister Obeid bin Saif al-Nasseri said Wednesday.

"I think we have to tackle first compliance, then we shall see if there is a need to cut," he said upon arriving in Vienna for a meeting Thursday of the 11-nation Organization of Petroleum Exporting Countries.

"Obviously there is oversupply in the market," Al-Nasseri said.

"I think we have to discuss the situation first and analyze the size of supply in the market then we have to take the right action," he said.

Wary of a glut on the world oil market following the end of the Iraq war, Opec is ready to take steps to ensure oil prices remain in its target range of $22-$28 a barrel, Saudi Arabian Oil Minister Ali al-Nouaimi said in Vienna Wednesday .

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

Opec is producing some two million barrels per day over this quota, ministers have said.

The problem now is that prices are falling, although they are still in the high range of Opec's $22-$28 a barrel band. - Sapa-AFP