OPEC calls special talks, warns of delay cut
OPEC calls special talks, warns of delay cut
Michael Thurston, Agence France-Presse, Vienna
The OPEC oil cartel, in a tense stand-off with rivals over how to boost sagging prices, confirmed Monday it will meet for special talks in Cairo next week -- and warned it could delay an output cut if other producers fail to play ball.
The 11-member grouping, which produces 40 percent of the world's crude, could even announce this week a one-month delay of the production cut, currently scheduled for January 1, said an OPEC source.
"Maybe we will wait another month, maybe the first of February," said the source, confirming that Organisation of Petroleum Exporting Countries (OPEC) ministers will meet in Cairo on December 28.
An announcement about a delay could be made Tuesday.
"We might announce something tomorrow. Because you cannot wait another two weeks, and say OK because we're meeting on the 28th we're going to delay the action. You have to say that right now," he said.
OPEC agreed in mid-November to cut its production by 1.5 million barrels per day (bdp) from January 1, on condition that non-OPEC rivals cut by 500,000 bpd.
Major non-OPEC producers, notably Russia and Norway, have offered to cut their production, but so far not by the combined 500,000 bpd demanded by OPEC.
Russia has been the main target of OPEC criticism. Initially Moscow offered a tiny 30,000 bpd cut, a fraction of its production of seven million bpd. But under pressure it raised its offer to 150,000 bpd.
According to OPEC, Mexico has so far pledged a 100,000 bpd cut, Norway 100,000-200,000 bpd, Oman 40,000 bpd, while Angola confirmed last Friday that it would cut by 22,500 bpd.
OPEC, which fears that non-OPEC rivals would simply increase their market share if it cuts production unilaterally, says it wants clear commitments from its rivals.
"There is some concern among ministers that unless they have some kind of written commitment from non-OPEC to come up with some fixed numbers upon which we can base our upcoming decison, they will have nothing to discuss," he said.
In London on Monday crude prices fell in early deals. A barrel of Brent North Sea reference crude for February delivery fell 43 cents to 18.72 dollars a barrel.
The market has see-sawed in recent weeks as it anticipates a broad deal between OPEC and its rivals to restrict global supply in line with falling demand.
Crude prices slumped dramatically in the wake of the September 11 terrorist attacks, which have deepened an already approaching global recession expected to slash demand for oil.
Meanwhile OPEC Secretary General Ali Rodriguez was returning to Vienna on Monday, after attending a regional meeting in the Caribbean, and would be working on the issue, he said.
The Arab-dominated cartel has pencilled in the Cairo meeting last week, saying its ministers would gather if non-OPEC rivals had failed to agree the required 500,000 bpd cut. On Monday the OPEC source said the Cairo meeting will definitely take place.
The date and venue of the meeting are linked to an already scheduled meeting of the Organization of Arab Petroleum Exporting Countries (OAPEC) in Cairo on December 29. Most OPEC members are also OAPEC members.