Norwegian, Venezuelan oil ministers to watch oil pricing

OSLO, Norway (<a href=thestar.com.my>The Star Online-AP) - Venezuelan Oil Minister Rafael Ramirez found his Norwegian counterpart willing to trim production if needed, but not as part of the general curb being sought by OPEC.

Norwegian Oil Minister Einar Steensnaes Monday said any decision by his country - the world's third biggest producer with about 3 million barrels a day - would be unilateral and based on its own assessment of the market.

Ramirez met Steensnaes ahead of Wednesday's meeting of the Organization of Petroleum Exporting Countries in Doha, Qatar.

Steensnaes said price alone would not precipitate a cut in production by Norway, which is not part of OPEC, but stressed a downward "price dynamic'' from an already low price could trigger a tightening of Norwegian output.

"We should also learn to accept low prices,'' he said, adding they could lead to more stability in oil markets.

Steensnaes pointed to Norwegian support for tightened OPEC production in August 2001, when Norway decided to cut production by 150,000 barrels per day after prices reached US$15 per barrel of crude.

"We can do that again if necessary,'' he said, adding that US$20 a barrel was "normal.''

Global prices have been within OPEC's target range of US$22 to US$28 a barrel.

Oil production accounts for nearly a third of Venezuela's gross domestic product, the value of all goods produced in a country, and Ramirez lauded the bilateral support.

"There have been strong shocks, sabotage in Venezuela and then Iraq,'' Ramirez said.

"The state of the market has many issues, but price reflects the interests of producing countries, consumers and investors.''

Venezuela is the world's fifth biggest oil exporter.

Concern about the resumption of oil exports from Iraq - the country could produce some 2 million barrels daily - could hamper Venezuela's economic recovery.

A major oil exporter to the United States, Venezuela was convulsed by a brief coup in 2002 and a ruinous general strike earlier this year.

"The question is, when production in Iraq is restarted, we then have a complicated situation,'' Ramirez said.

"OPEC has a high level of responsibility.''

He said evaluating Iraq's new levels of oil output would depend on several factors, including how quickly it is introduced.

He said OPEC members would likely meet again in September to discuss the ramifications of Iraqi oil being made available on the market now that U.N. sanctions are being lifted. - AP