Libya opposes cuts

Press, 25 July 1985, Page 6

Libya opposes cuts

NZPA-AP Geneva Libya and other African members of O.P.E.C. are holding out against a Saudi Arabian-sponsored plan to cut oil prices, sources said. The 13 oil Ministers of the Organisation of Petroleum Exporting Countries failed to settle the issue after a second full day of negotiations, although some Ministers said progress was made. Saudi Arabia has proposed cutting the price of the group’s lower-grade oils, now pegged at 5U526.50 a barrel, to regain sales lost to Mexico and other nonO.P.E.C. producers of lowergrade crudes. The Saudis’ total oil production has dropped to a nearly 20-year low of about 2.2 million barrels a day. It has the capacity to pump as much as 10 million a day and has threatened to boost output even though that would send prices plunging. The reference price for O.P.E.C.’s top-grade oils, now SUS2B a barrel, was expected to be kept unchanged. The Saudi Oil Minister, Sheikh Ahmed Zaki Yamani, has not said how big a price cut he wants, but conference sources said the most likely reduction would be 50 cents. The Libyan Oil Minister. Fawzi Shakshuki, stated several times that his country wanted O.P.E.C. prices to be held. Algeria. Gabon and Nigeria reportedly support him. The Africans, who do not sell lower-quality crudes, were resisting the price-cut proposal because it would put more pressure on them to cut their prices too.