Indonesia should retain OPEC leadership: Analysts

JAKARTA (JP): New Minister of Mines and Energy Kuntoro Mangkusubroto should assume the position of his predecessor, I.B. Sudjana, as president of the Organization of Petroleum Exporting Countries (OPEC), an OPEC official and an analyst said here yesterday.

OPEC governor for Indonesia Purnomo Yusgiantoro and former OPEC secretary-general Subroto said OPEC ministers had elected Sudjana as the organization's president during their conference last November in Jakarta in his position as the country's then minister of mines and energy.

Kuntoro, as Sudjana's successor, should automatically become OPEC president, they said.

"The position of OPEC president is held by a minister, not a person. This is the point we want to put forward for discussion at OPEC's headquarters in Vienna," Purnomo said.

Sudjana was elected OPEC president for a period starting from OPEC's ministerial conference in Jakarta last November until the next ministerial conference in June.

Purnomo and Subroto made their remarks following a report that United Arab Emirates (UAE) Oil Minister Obaid bin Saif Al Nasseri would replace Sudjana as OPEC's new president.

Al Nasseri was elected alternate president during the November meeting in Jakarta.

Dow Jones quoted an anonymous UAE official as confirming Al Nasseri's appointment, but OPEC headquarters has thus far not been able to provide further details.

Purnomo acknowledged that OPEC's statute does not clearly support Kuntoro's appointment to replace Sudjana.

But the statute also does not justify replacing Sudjana with Al Nasseri either, he said

"We are now in intensive discussions with OPEC headquarters over this issue," he said.

Article 14 of the OPEC statute says: "The (OPEC ministerial) conference shall elect a president and an alternate president at its preliminary meeting. The alternate president shall exercise the responsibilities of the president during his absence, or when he is unable to carry out his responsibilities."

The statute further says: "The president shall hold office for the duration of the conference and shall retain the title until the next meeting."

Subroto interpreted the article as implicitly saying someone was appointed OPEC president not as a person but as a minister.

As such, Indonesia's mines and energy minister should retain the OPEC presidency despite the fact that Sudjana has left office, he said.

Analysts say Al Nasseri's appointment would have an adverse impact on oil prices because he is less inclined to reduce OPEC's output ceiling.

But the market would favor an OPEC president from Indonesia because the country speaks for the reduction of OPEC's output ceiling to improve oil prices, the analysts say. (jsk)