Pact on oil cut held up

Press, 2 May 1988, Page 10

Pact on oil cut held up

NZPA-Reuter Vienna The fate of a unique plan by O.P.E.C. and nonO.P.E.C. producers to boost oil prices by jointly withholding supplies from the market hangs in the balance after a meeting ended in deadlock yesterday.

Saudi Arabia, Kuwait, Qatar and the United Arab Emirates told the nine other members of the Organisation of Petroleum Exporting Countries they thought O.P.E.C. should cut its output by 183,000 barrels a day (bpd) in May and June, Ministers said.

It was their reply to Algeria’s proposal on Friday that the 12 O.P.E.C. members which have output quotas should cut 300,000 bpd from their output for those two months. The Iranian Oil Minister, Gholamreza Aqazadeh, told reporters early yesterday that the Saudi-led proposal had been rejected and talks would resume in the evening. Belkacem Nabi, Al-

geria’s Oil Minister, said after the three-hour session: "We will try again tomorrow for the last time.” Asked if there were any hope of reaching an agreement, he said: "I don’t think so.” Arturo Hernandez Grisanti, of Venezuela, said, “We have given time to the four countries to think again.” Non-O.P.E.C. producers, Angola, China, Egypt, Malaysia, Mexico and Oman, have offered to cut their exports by five per cent in May and June — which would take some 200,000 bpd from the market — but this was conditional on O.P.E.C. reciprocating.

“I think it will be agreed,” one senior Gulf delegate said. “If not, there will be some sort of compromise.”

Prices rose over the last couple of weeks in anticipation of an agreement, but the mid-range Saudi light crude was still quoted at only $15.55 a barrel on Friday, two dollars below its official price.