Russia Pledges Full Cooperation with OPEC to Stem Oil Supply Shortfall

06/01/2003| IslamWeb

The world's biggest non-OPEC oil exporter Russia said that it was prepared to consider "all forms of cooperation" with the cartel to boost deliveries and stem the precipitous rise in world prices. Energy Minister Igor Iusufov said he believed there was a global supply shortfall of between one million and 1.5 million barrels per day and that Russia was even ready to provide Venezuela with tankers to export its oil in the face of a crippling, long-running strike.

"We're ready for all forms of cooperation for the sake of stability between consumers and suppliers," Iusufov told reporters after being greeted at the airport here by Kuwaiti Oil Minister Sheikh Ahmad al-Fahd al-Sabah.

"It is necessary to have enough oil for the economies of all consuming countries and also the appropriate price for both consumers and suppliers.

"If any measures will be needed from our side, we are ready to take them to achieve these aims," said Iusufov, who arrived in Kuwait from the world's biggest producer Saudi Arabia.

Sheikh Ahmad said Kuwait was conferring with other OPEC producers, including Saudi Arabia, on what "move" to make if oil prices remained above the cartel's target range of 25 to 28 dollars until January 14.

"If the prices will continue for 20 days with this average ... of course OPEC will move positively to solve this problem ... just to make sure there is no shortage in the market and to guarantee market stability," the Kuwaiti oil minister said.

"There is a communication channel with my colleagues, the ministers of OPEC, just to prepare the scenario and the strategy for our next move after the 20 days of those prices."

The oil production quotas set by OPEC include a provision, used once before in October 2000, for a 500,000 barrel per day increase if prices remain above the cartel's target range for 20 straight days.

But the United Arab Emirates hinted Sunday that OPEC ministers might agree to a bigger production increase this time.
It was down to the cartel's members to "hold consultations to determine the volume of additional production," said Oil Minister Obeid bin Seif al-Nasseri.

Iraq war jitters, the strike in Venezuela and a particularly cold winter in the United States have all helped to push world prices higher in recent weeks.

In New York, the price of reference light sweet crude for February delivery rose 1.23 dollars to 33.08 dollars in late deals Friday.

Earlier in London, the price of benchmark Brent North Sea crude oil for February delivery rose to 30.16 dollars a barrel from 29.49 dollars Thursday.

In Riyadh on Sunday, Iusufov and Saudi Oil Minister Ali al-Nuaimi stressed the "need to restore stability to the markets and make sure they do not rise to a level which could have a negative impact on world economic growth," the official Saudi Press Agency said.

PHOTO CAPTION

Russian Energy Minister Igor Iusufov