Kuwait to cut oil productiongreenspun.com : LUSENET : TB2K spinoff uncensored : One Thread
Mar 04 06:26 AM GMT Home: Business: Oil & Energy Kuwait to cut oil production
Analysts say Kuwait's notice was most likely issued to support the country's hawkish OPEC stance.
March 02, 2000, 10:04 AM
SINGAPORE (Reuters) - OPEC member Kuwait has told customers it will cut supply through the second quarter of the year, even though OPEC has not decided policy for that period yet.
US Energy Secretary with Kuwaiti counterpart in Feb 24 meeting World markets -- with steamy oil prices at nine-year highs above $30 per barrel -- are looking for signals about OPEC`s output policies after March, when the current policy of holding back crude is due to expire.
Analysts said Kuwait`s notice was most likely issued to support the country`s hawkish OPEC stance that the cartel should maintain its policy of holding back production beyond March.
OPEC is scheduled to meet from March 27 in Vienna to decide whether to relax a one-year policy cutting supply by 4.3 million barrels per day.
Kuwait, with Iran, Algeria and Libya said they plan to urge OPEC to keep its tight rein on production -- which has driven prices to nine-year highs.
Some other OPEC members are urging a more relaxed stance.
"I would think Kuwait is aware of the fact that a number of agencies will be looking for signals in its actions with regards to its future production intentions," said John Russel, managing director of Bangkok-based Petroleum Economics Ltd.
"Kuwait would not want at this stage, certainly not ahead of the OPEC meeting, to issue anything which seemed to suggest a change in its position," he said.
Qatar tells buyers no cuts
Several OPEC producers have issued notices to customers each month during the past year to let them know how much less crude they could expect to receive compared with contractual levels.
Kuwait, with production of two million bpd but a quota of 1.836 million, let customers know on Wednesday it would maintain the cuts seen in the first quarter during the second quarter.
That was a cut of 11.5 percent from contract volumes.
But traders and analysts said Kuwait was reinforcing its position ahead of OPEC and they doubted it would maintain the cuts if OPEC decided to change policy in March.
"I would not interpret anything that is being indicated now as something that could not be changed," Russel said.
Qatar, on the other hand, said on Wednesday it would not make any supply cuts to Asian customers in the crucial month of April.
QGPC had also skipped applying any cuts for March-loading cargoes, traders said.
Qatar is one of OPEC`s smallest producers and has generally produced above its quota during the past year`s cuts programme.
Signals from powerful producers like Saudi Arabia, Iran, Kuwait and the United Arab Emirates would be more important, they said.
Qatar, with a quota of 593,000 barrels per day (bpd) but production above 600,000 bpd, had initially cut term supplies of Qatar Land and Qatar Marine by around seven percent.
Key oil producers have sent mixed signals about the size and timing of a rise in production to take the heat out of oil prices.
The oil ministers of Saudi Arabia, Venezuela and Mexico -- the architects of the current accord -- are due to meet in London on Thursday to discuss future oil policy.
The outcome of the meeting is being closely watched as the likely main signal on what OPEC will decide later in the month.
-- Crossposter (firstname.lastname@example.org), March 04, 2000
The next time those folks get invaded by Sadaam or anyone else, they better not look to the US for help. What short memories they have! Bush should have gotten an oil agreement from them before we sent our boys over to the desert to defend them.
-- Kitty in VA (email@example.com), March 04, 2000.
"Just keep smilin' boy, the
plan is working perfectly."
"By the time November gets here
the sheeple will be begging for
you to come to the rescue."
-- Hawk (firstname.lastname@example.org), March 05, 2000.