ABU DHABI, June 11 (<a href=www.arabtimesonline.com>AFP) - The OPEC Fund agreed to lend a fresh 250 million dollars to the private sector in poor and developing countries at a meeting in Abu Dhabi Wednesday, the fund's director general told AFP. This will take to 500 million dollars the total of loans extended to the private sector in these countries, Y. Seyid Abdulai said. Finance ministers from the member states of the Organization of Petroleum Exporting Countries held the annual meeting of the OPEC Fund in the absence of member Iraq, and Abdulai said they had not discussed extending reconstruction assistance to the war-torn country. He had told reporters on Tuesday that aid to Iraq might come up during the meeting. Although the OPEC Fund does not provide assistance to its member countries, "Iraq is a special case. The ministers can discuss whatever they want and whom to fund," Abdulai said. The ministers from Algeria, Indonesia, Iran, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela were told that lower oil production had impacted economic growth in OPEC member states but steady oil prices would see better growth this year. "In our own member states, average growth moderated to 1.8 percent in 2002 from 2.6 percent in 2001, mainly reflecting oil production cutbacks," said Saleh al-Omair, chairman of the fund's governing board. "But growth in our member countries should gather pace, supported by continued firm oil prices and fiscal stimuli," he added. OPEC announced at the end of an extraordinary meeting in Qatar Wednesday that it would maintain its current production ceiling of 25.4 million barrels per day (bpd) at least until July 31 when it meets in Vienna to discuss Iraq's return to the market, but urged members to comply strictly with quotas. With a capital of 3.435 billion dollars, the OPEC Fund committed to loans totaling 6.6 billion dollars until April this year, with actual disbursements reaching 4.43 billion dollars.

The Associated Press DOHA, Qatar June 11 —

OPEC ministers decided Wednesday to maintain current production levels at least until the end of July, the president of the oil cartel said.

Abdullah bin Hamad al-Attiyah told reporters initially the 11-nation cartel would preserve its output level until its next scheduled meeting in September. But he later said the Organization of Petroleum Exporting Countries would hold an extraordinary meeting on July 31 to reassess the situation.

"Then we will have some options either to cut production or not. That is what we need to decide," al-Attiyah said.

Al-Attiyah, who is also the oil minister of Qatar, said the July meeting would look at the impact of Iraq's return to the oil market.

Oil prices initially moved slightly lower in the wake of the announcement, but were trading higher for the day by early afternoon in New York.

Before the decision was made, Iranian Oil Minister Bijan Namdar Zanganeh said he expected OPEC to maintain current output "for two to three months." Venezuelan Deputy Oil Minister Luis Vierma said he thought OPEC might be able to keep present the production ceiling of 25.4 million barrels a day until the end of the year.

The OPEC ministers also pleaded for greater self-discipline, urging member states to stop exceeding production quotas.

"The conference decided to maintain currently agreed production levels with stricter compliance of designated quotas," OPEC spokesman Omar Farouk Ibrahim told reporters.

Attracted by high prices, member states have been exceeding their designated quotas and have oversupplied the market by about 1.5 million barrels a day.

The oil minister of the United Arab Emirates, Obaid bin Saif al-Nasseri, called for members to respect their quotas.

"The market is comfortable, but we should think ahead to the third quarter," which begins July 1, al-Nasseri said Tuesday.

He estimated overproduction by the 10 OPEC nations, excluding Iraq, at 1.5 million barrels a day. That means the group is pumping 26.9 million barrels a day onto the market.

"We should look into reducing actual production of member states" rather than adjust the ceiling, al-Nasseri said.

"OPEC must be very careful in handling Iraqi's return," Iranian oil minister Bijan Namdar Zanganeh told reporters earlier Wednesday.

Iraq, which was excluded from OPEC's quota schedule during the 12 years of U.N. sanctions, says it hopes to export 1 million barrels a day by the end of June and 2 million barrels a day by the end of the year.

Analysts say that is too optimistic in view of the state of Iraq's oil industry, which suffered war damage, postwar looting, a chronic shortage of spare parts during the sanctions period. Before the war began in March, Iraq pumped around 2.5 million barrels a day.

Members of the 11-nation cartel differed over when Iraq was expected to resume oil exports, and when the OPEC would need to curb production in order to accommodate Iraqi supplies.

"The pace and the extent of the return of Iraqi crude to the market remain unclear," OPEC President Abdullah bin Hamad al-Attiyah said in his opening speech to Wednesday's meeting, at which Iraq was not represented.

Kuwait's acting oil minister, Sheik Ahmad Fahd al-Ahmad, said Iraq needed until September to raise its production to 2 million barrels a day, and that OPEC production could remain unchanged until then.

"From now until September, Iraq will need (to do) a lot to reach the level of production," Sheik Ahmad said. "For that, we still have time to continue our ceiling."

OPEC's al-Attiyah foresees Iraq pumping 1 million barrels a day of oil by the third quarter. He has urged producers to take steps to avoid a glut and price crash.

An OPEC meeting before the scheduled one in September had been seen as necessary to discuss not only Iraq's return but also the high level of oil prices. Prices have hovered around the upper limit of OPEC price band of $22 to $28 a barrel.

OPEC's basket of seven crude oils averaged $27.53 a barrel on Monday. Oil prices hit a three-month high in New York, nearly reaching $32 a barrel.

On Wednesday, July contracts of light sweet crude were up 62 cents at $32.35 a barrel in afternoon dealings in New York. In London, North Sea Brent for July rose 32 cents to $28.40.

If OPEC members do manage to comply with their quotas, an American national industry report has predicted that U.S. consumers may have to pay more per gallon as demand increases during the summer vacation months.

"Gasoline prices are already rising in some parts of the country on a spotty basis," the Lundberg Survey of 8,000 stations reported Sunday. "Considering the latest crude oil developments, it's likely gasoline prices are turning round and will soon rise."

Non-OPEC producers are also concerned about the impact of Iraqi oil when it comes on stream. Russia and Mexico sent delegates to the Wednesday meeting.

DOHA - AFP - OPEC announced on Wednesday it will maintain its current production ceiling at least until July 31 when it meets in Vienna to discuss Iraq's return to the market, but urged members to comply strictly to quotas.

"We agreed in April that the ceiling is 25.4 million barrels per day (bpd) from June 1," OPEC President Abdullah bin Hamad al-Attiyah told reporters at the end of an extraordinary meeting of the cartel in Qatar.

"Today we reconfirmed this agreement. We hope there will be no overproduction (above quotas) during this period" - which is effective until July 31.

Attiyah added that the 11-member oil cartel would do "whatever it can" for war-torn Iraq, adding it was difficult to predict when Baghdad would overcome its technical problems and resume exports.

"We hope we can see a government in Iraq, an oil minister. Until then, we will continue discussing with Iraqi oil officials how we can collaborate."

Attiyah said the Organisation of Petroleum Exporting Countries would do its "best to accommodate Iraq smoothly," treating it as a "unique" case in order to keep it within the cartel which was born in Baghdad 43 years ago.

The US-British coalition ruling Iraq has said it would be up to the next Iraqi government to decide on remaining in the cartel also made up by Algeria, Indonesia, Iran, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates and Venezuela.

In a statement released at the end of the meeting, OPEC said stability has been "maintained in the market following the decision taken by the (OPEC) conference in April 2003 to reduce actual production to 25.4 million bpd, with prices remaining within agreed levels".

"Despite the fact that the market remains well-supplied, prices displayed an upward trend recently due to the slower-than-anticipated recovery in Iraqi production, coupled with unusually low stock levels," it said.

"However, with low stock levels anticipated to be replenished during the third quarter, the conference decided to maintain currently agreed production levels, with strict compliance, and emphasised that continued vigilance in monitoring market developments is imperative over the coming period."

OPEC said it "welcomed the return of Iraq to the oil market" and looks forward to the country's resumption of its role in the organisation.

"The conference again made its standing call on other oil producers/exporters to continue to cooperate with OPEC in its endeavours to maintain market stability in the interests of all concerned."

Attiyah said the cartel will meet in Vienna on July 31 even if Iraq does not resume exports, in order to "assess the market".

He refused to speculate on the volume that could be eventually slashed by OPEC on July 31 should Iraq resume exports, but hinted that non-OPEC exporters would have to join in any potential cut.

"Co-operation with them (non-OPEC) is important," he said.

Non-OPEC states Angola, Mexico, Oman, Russia and Syria all took part in the Doha meeting as observers, underlining their commitment to co-operate with OPEC.

OPEC ministers have said that the cartel was currently producing in excess of one million bpd above the cartel's ceiling.

The OPEC president said the conference in Doha was initially a "meeting to cut" production to accommodate the upcoming Iraqi exports.

But the oil ministers decided to maintain the ceiling because "it is difficult to predict when Iraq will return to the market," he added.

According to OPEC's estimates, Iraq's production should reach 2 million bpd by the end of the year, about 700,000 bpd below pre-war level. This would leave Iraq with 1.5 million bpd of exports only.

Oil prices were little moved shortly after OPEC's announcement, remaining slightly lower than the previous day's close.

In London, the price of benchmark Brent North Sea crude oil for July delivery was down 19 cents to 27.93 dollars per barrel.

New York's light sweet crude July contract was 11 cents lower at 31.62 dollars per barrel in out-of-hours electronic trading.

"The market had so much anticipated this decision to keep quotas unchanged, that is why oil prices have not moved sharply," said Prudential Bache analyst Christopher Bellew.

OPEC had previously been tipped to cut quotas to shore up prices, but these have stayed strong in recent weeks, buoyed by low stocks in the United States.

AFP

June 11 (<a href=quote.bloomberg.com>Bloomberg) -- The Organization of Petroleum Exporting Countries, pumping at near-record levels, agreed to leave its oil quotas in place as delays in Iraqi sales drive up prices.

There is no shortage of oil,'' said OPEC President Abdullah bin Hamad al-Attiyah in Doha, Qatar, where the group met today and agreed to maintain a sales target of 25.4 million barrels a day. I don't think the price will jump. We are watching the market very carefully.''

The group will reconvene July 31, and members are ``committed'' to reduce supplies this month under their agreement reached in April, the president said. OPEC is concerned that a return of Iraqi oil production after the war will flood the market, causing prices to drop.

OPEC is lobbying non-members including Norway and Mexico for support in lowering output later this year, seeking to keep prices within the cartel's target range of $22 to $28 a barrel. OPEC's price index was at $27.51 a barrel yesterday, up 22 percent in the past year. Crude oil was down 20 cents at $27.90 a barrel as of 2:31 p.m. in London on the International Petroleum Exchange.

Ministers instead of reducing quotas have called for greater compliance with the existing targets. OPEC's 10 members outside of Iraq in May pumped 26.4 million barrels a day, according to Bloomberg estimates, above the group's goal by 1 million barrels.

Iraq

Iraqi exports stopped when U.S. and British forces invaded on March 20 to oust President Saddam Hussein over allegations he was amassing weapons of mass destruction. Looting since then has hampered efforts to restore production. The nation is now producing 700,000 barrels a day, which may rise to 1.5 million this month, officials have said.

There is now almost a balanced market,'' said Abdulhasid Mahmoud Zlitni, Libya's top oil official, in Doha. Looking ahead to the arrival of Iraq oil on the market, if members do not cut supply to the level of production agreed to in Vienna, there will be 600,000 to 800,000 barrels of oversupply,'' he said.

Oil officials in Iraq have said the nation will take months to get to normal. The head of Iraq's northern oil fields said the export pipeline to Ceyhan, Turkey, may be shut for eight weeks because theft has disabled control systems. The southern manager said output will peak this month at 800,000 barrels a day, barely a third of prewar levels, until security resumes.

If you look at the history of the last two months, expected Iraqi export levels have been continuously revised down and pushed out,'' said Pieter Bruinstroop, who manages resource-company investments for APS Asset Management Ltd. in Singapore. All that OPEC can do, like it has done, is say, `OK, when production gets to about 2.5 million barrels, we will cut.'''

Iraq, a founding member of OPEC in 1960, had no representatives at the meeting. The OPEC president said he's waiting for an internationally recognized government in Iraq to designate an oil minister to attend OPEC meetings.

Russia

In addition to its own reductions, OPEC wants cutbacks from non-members Russia, Norway, Mexico and Oman. Norway this week has said it may consider such a move if prices drop. The nations have in the past cooperated with OPEC to restrict supplies and keep prices high.

The interests of Russia and OPEC concur in many ways,'' said Russian deputy minister of fuel and energy Alexander Voronin in Doha. But making decisions on how much oil to export, Russia, as it did before, will proceed from the needs of the Russian economy and the necessity of increasing the living standards of our population.''

Oil inventories are falling in the U.S., the world's largest energy consumer, also bolstering prices. Supplies are at 289 million barrels, according to government estimates, down 11 percent in the past year.

Oil inventories in industrialized countries are relatively tight for this time of year,'' al-Attiyah said. This may serve to support oil prices in the coming months.''

OPEC's 11 members are Saudi Arabia, Iran, Iraq, Kuwait, the United Arab Emirates, Qatar, Algeria, Nigeria, Libya, Indonesia and Venezuela.

VIENNA, Austria, April 24, 2003 (AP) "We feel we may need another cut in June." OPEC President Abdullah bin Hamad Al-Attiyah (CBS) OPEC members agreed to cut their current oil output by 2 million barrels a day, or 7 percent, in a move aimed at preventing a further decline in prices, the cartel announced Thursday.

At the same time, the Organization of Petroleum Exporting Countries temporarily raised its official output target to 25.4 million barrels, up 900,000 barrels a day from its existing ceiling. The new quota would take effect June 1, OPEC President Abdullah bin Hamad Al-Attiyah told a news conference.

The delegates announced their decision after emergency talks in Vienna. Crude prices have tumbled in recent weeks, and OPEC feared a further decline if it didn't rein in what it saw as an oversupply just as crude demand reached a seasonal low.

The group based its decision largely on what it said was sluggish global demand exacerbated by the outbreak of severe acute respiratory syndrome, which Al-Attiyah said has dampened demand by 300,000 barrels a day.

OPEC would review its decision when it meets again June 11 in Doha, Qatar.

"We feel we may need another cut in June," Al-Attiyah said.

OPEC also was ready to welcome Iraq back as a participating member, he added.

"I hope Iraq comes back tomorrow," he said, adding later: "We will accommodate Iraq at the right time."

Several OPEC members had boosted their production before the war, hoping to head off a supply shortage. The rapid end of the conflict left them facing what they see as a surplus of 2 million barrels a day.

"It is important to reduce oversupply," Venezuela's Oil Minister Rafael Ramirez told reporters before the hastily arranged talks began. "We have to have more discipline, and it is important to take measures and remove that amount from the market."

If not, OPEC, whose 11 members pump a third of the world's crude output, wouldn't be able to maintain its price target of US$25 a barrel, he said.

OPEC representatives called Thursday's meeting to reassess the group's output levels as oil began flowing again in Iraq for the first time since the war.

Many energy analysts had expected OPEC to agree to curb production. The question was whether OPEC would try do so by lowering its official output target or by taking the much less drastic step of reining in the amount of oil its members were pumping above their respective quotas.

In the end, it took the unusual decision of slashing its actual production — which it calculated as 27.4 million barrels a day, including Iraq — while also raising the nominal ceiling for OPEC's 10 members excluding Iraq. OPEC's current target is 24.5 million barrels a day.

The decision means Saudi Arabia, OPEC's most powerful member, would reduce its production by 1 million barrels a day, Al-Attiyah said.

In the days leading up to hostilities in Iraq, U.S. crude prices peaked at almost $40 a barrel. On Thursday, contracts of U.S. light, sweet crude for June delivery were trading in New York at $26.71 a barrel, up 6 cents from Wednesday's close. In London, June contracts of North Sea Brent crude were trading at $24.42, up 16 cents a barrel.