OPEC Calls for 'Reasonable' Oil Prices to Be Established

Published June 14th, 2000 - 02:00 GMT

The Organization of Petroleum Exporting Countries (OPEC) favors more "reasonable" oil prices than current levels, the organization's secretary general Rilwanu Lukman said in Geneva Tuesday. 

"We are interested to see to it that oil remains as a viable energy source," which requires it to be "delivered to the market at reasonable prices," Lukman told press at the 16th World Petroleum Congress being held in Calgary, Alberta. 

Lukman acknowledged that the entire current debate revolves around what parties call "moderate prices." 

"Ten dollars a barrel is not high enough, and 30 dollars is too high," said Lukman, adding that there ought to be "a reference price (somewhere) between the two (figures)." 

Analysts "are not sure what is happening to the market" or whether the increases are "a temporary problem," Lukman said. But he said it would be "bad to overreact." 

The OPEC official also noted that the major oil exporting economies who do not belong to the organization, such as Russia and Mexico, are also concerned at the situation. 

"They have adjusted to our practices of production ceilings to try and moderate supply when the prices were low," he said, hinting they may react in a similar fashion if it becomes necessary to increase oil products supply. 

Lukman defended OPEC members' policy, saying that "the main reason for the increase in price was purely and simply taxes in the consumer countries." 

He said that when oil prices decrease "certain industrialized countries take advantage of it to increase their taxes on petrol."  

Around 2,700 delegates from 92 countries are attending the congress, which is due to end Thursday. 

Protesters disrupted the inauguration of the congress Sunday, as they held demonstrations in Geneva against the oil industry's poor human rights and environmental management record. 

The oil industry benchmark light sweet crude rose 86 cents Tuesday in New York, to 32.56 dollars a barrel on oil for July delivery -- its highest since March, fueling concerns. 

On Monday, oil light sweet crude raised 1.54 dollars to 31.74. 

The world's largest producer Saudi Arabia on Sunday said it would not propose an increase in production at the next ministerial meeting of OPEC - GENEVA (AFP) 

 

 

© 2000 Al Bawaba (www.albawaba.com)

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