OPEC May Hold Emergency Meeting on Output Cut

Posted 06 October 2006 @ 06:39 am EET     Print     Reprint     E-Mail     Comments

ABUJA (AP) - OPEC President Edmund Daukoru has said that the international oil cartel might hold an emergency meeting to consider cutting production.

"We are toying with the possibility of having an emergency meeting," Daukoru, who is also Nigerian Oil Minister, said dismissing suggestions that the organisation had already reduced its daily output by one million. Official figures released in August put total OPEC production at just under 30 million barrels per day.

"We are still consulting on whether we should have an emergency meeting or not. It is at such a meeting that we will come up with an appropriate action," Daukoru said.

In Algiers, the Algerian press agency APS quoted an "informed source" who said the meeting would take place on October 18-19 in Vienna.

In London, the price of oil jumped above 60 dollars a barrel. The main New York contract for November delivery rose by 75.0 cents to 60.45 dollars a barrel.

Earlier the Financial Times newspaper reported in Europe that OPEC had already agreed informally to cut its output by one million barrels per day or 4.0 percent to prop up the price which has fallen by 25.0 percent from record high levels in July.

APS echoed that report later in the day.

The head of the Organization of Petroleum Exporting Countries said here that although there appeared to be a consensus among members for a production cut to support the market, only a meeting can ratify that.

"From all the different statements, you will notice that we have a shared concern. Ths consensus is one of shared concern. We each have an idea of what is appropriate response but until we meet before we arrive at an agreed position on what to do," he said.

"We know that something needs to be done. How much, how soon and how to distribute it among member countries will be an issue if we do meet," he added.

Daukoru said that some members such as Nigeria, Venezuela, Algeria and Saudi Arabia were already doing something about it.

Nigeria and Venezuela have announced that they would reduce their oil production by a combined 170,000 barrels per day.

"We took that pre-emptive position. Venezuela also promised me they will announce 50,000 barrels cut. Algeria also gave me some understanding. The Saudis were already taking some measures on their own part," he said.

"As it is now, whatever people hear is simply individual views of OPEC member countries," he added. OPEC output quota has remained at 28 million barrels per day since June 2005.