OPEC Renews Pledge to Boost Supply in Event of War Shortages

02/02/2003| IslamWeb

OPEC will deal with any unforeseen development such as war on Iraq, and increase supply to meet demand, the oil cartel's president, Abdullah bin Hamad al-Attiyah."If there is a shortage of supply, OPEC will balance demand and supply," Attiyah told reporters Sunday on the sidelines of an energy and environment conference in the Emirati capital."We have learnt from history how to deal with these situations," he said, adding that the Organisation of Petroleum Exporting Countries (OPEC) had "learnt a lot of lessons" from the 199O Iraqi invasion of Kuwait and 1991 Gulf war.

Attiyah said no OPEC meeting had been scheduled during the Abu Dhabi conference attended by at least 11 oil ministers.

"Only bilateral talks are taking place but not any OPEC meetings because not all the oil ministers are present.

"The next OPEC meeting is on March 11 and we will discuss all options taking into account the market situation. For sure we will take into account any surprise development in the market also."

In the event of a US-led attack on Iraq, the cartel could convene a snap meeting, said Attiyah, who is Qatar's energy and industry minister.

"OPEC always has a tradition, can meet any time to discuss the markets, but I hope not to see a war," he said.

Saudi Oil Minister Ali Al-Nuaimi renewed Saturday in Abu Dhabi the kingdom's pledge to activate spare oil production capacity and make up for any loss in world petroleum supply if war breaks out.

The world's top oil exporter "does not hope that a strike on Iraq happens but, if it does, it is committed to cover the needs of the market in line with its capacity," Nuaimi said.

On Friday, New York's light sweet crude March-dated futures were priced 33.51 dollars a barrel, well above the 22 to 28 dollar per barrel OPEC price band.

In London, the price of benchmark Brent North Sea crude oil for March delivery fell was 31.06 dollars per barrel, despite OPEC's decision in mid-January to increase production by 1.5 million barrels a day from next month.

Industry analysts have warned that war in Iraq and continuing labour unrest in Venezuela could deprive the global oil market of some five million barrels per day.

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Qatar's Energy and Industry Minister Abdullah bin Hamad al-Attiyah