Saudi Arabia Wants to Wait Before Increasing Oil Flows

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Jun 23, 2000 - 01:16 PM

Saudi Arabia Wants to Wait Before Increasing Oil Flows The Associated Press

OSLO, Norway (AP) - Saudi Arabia's oil minister said Friday that OPEC should hold off on further production increases to see where world prices stabilize. "The question is, where is this volume going? So we have be extremely careful in just adding to supply," oil minister Ali Naimi said. "We are very concerned about the fact that close to 4 million (barrels per day) has already been put in the market, and we still see high oil prices. We would like to see them lower."

"It is important that you understand what it happening before you make a move," he added.

Naimi was in Oslo to meet Norwegian oil minister Olav Akselsen. Norway will decide on Thursday whether to increase its oil output during the third quarter of this year.

Saudi Arabia is the world's largest oil exporter. Norway is No.2.

Oil prices nearly tripled to about $30 a barrel after hitting 12-year lows in late 1998, when the Organization of Petroleum Exporting Countries and nonmember producers, including Norway, withheld supplies to counter a global glut.

Naimi said oil producers have eased up on those cuts, allowing about 4 million barrels of oil per day onto the global market since March.

OPEC members agreed Wednesday to boost output by 708,000 barrels a day, efdective July 1.

He said OPEC has a target of $25 per barrel, and would not tolerate another collapse in oil prices to the $10 level without cutting supply. "We will regulate our supply to attain the goal," he said.

Naimi also urged oil importing countries to look at ways of easing prices for consumers by cutting taxes. Some countries earn more in fuel taxes than oil producers make on the product.

Akselsen said Norway will decide next week whether to adjust its 100,000 barrel-per-day production cut. Norway now produces about 3.2 million barrels of oil per day.

http://ap.tbo.com/ap/breaking/MGI58JC3U9C.html

-- Martin Thompson (mthom1927@aol.com), June 23, 2000


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