Saudis slash oil output as crisis talks date is set

Press, 8 March 1982, Page 8

Saudis slash oil output as crisis talks date is set

NZPA-Reuter Doha. Qatar The Organisation of Petro-.' lium Exporting Countries decided yesterday to hold an emergency meeting on March 19 ’in Vienna after key Oil Ministers agreed in talks in Qatar, to cut the group’s output to defend prices against the prevailing world glut.., . .. . -- The Saudi Arabian Oil Minister (Sheikh Ahmed Zaki Yamani), who said his country had cut its production ceding by one million barrels daily, told reporters after the Ministers had discussed how to fight the glut: "Now we can have a very successful meeting."

Tayeh Abdul-Karim of Iraq said Ministers agreed to set a ceiling on output of 18.5 million barrels daily, down from present output which

he estimated at about ,20 millions. . • ■ He .added? “This,, is the -maximum. We will go down as far as the market." Sheikh Yamani ’ said the quote for Saudi Arabian light crude, used as O.P.E.C.’s base price, would remain frozen at SUS 34 a barrel at least to the end of this year. Mr Abdul-Karim said there was no question of prices being cut. Saudi crude has been sold recently as low as SUS 29 a barrel on the spot market.

O.P.E.C. is under pressure from an unprecedented world oil glut that has triggered unilateral price cuts and. according to industry sources, secret price discounting by exporters fighting for a share of the oversupplied market.

Yesterday’s informal talks came after the Indonesian

Oil Minister (Dr Subroto) and Mallam Yahya Dikko of Nigeria flew to Qatar to join Arab colleagues who were' there for a meeting of the separate Organisation of Arab Petroleum Exporting Countries, which co-ordinates the Arab oil industry. Nine of O.P.E.C.’s 13 countries were represented, although Libya's newly-ap-pointed Oil Minister (Mr Kamal Hasan Maqhour) sent a deputy. Sheikh Yamani said Saudi Arabian oil output in January and February had been just over 8.5 million barrels daily. Oil-industry sources had said the kingdom's production in these months was between seven and., eight million barrels daily./but Sheikh Yamani said market forces had not brought down output as he expected.