RI wants OPEC to maintain oil production level

RI wants OPEC to maintain oil production level

JAKARTA (JP): Minister of Mines and Energy Susilo Bambang
Yudhoyono said on Friday Indonesia would ask the upcoming
ministerial meeting of the Organization of Petroleum Exporting
Countries (OPEC) to maintain the present production level.

Bambang said the present production level proved to have
maintained oil price stability.

"Not only have prices been stable but they've also reached a
good level," Bambang told reporters at his office.

However, he added, Indonesia would be open to discussions if
OPEC members asked for a slight production increase six months
after the meeting.

OPEC ministers are scheduled to hold a meeting in Vienna in
March.

The ministers decided in March last year to cut oil output by
over two million barrels per day (bpd) to boost oil prices which
slumped to a low level.

Under the March output quota, Indonesia had to cut its oil
output from 1.5 million bpd to 1.187 million bpd.

Meanwhile, AFP news agency reported that key OPEC ministers
gathered in Vienna on Friday to review the state of world oil
markets and prices, amid growing signs that the cartel will
extend a year-long agreement capping production.

OPEC's Market Monitoring Committee (MMC) has made no official
decision on prolonging the accord, which ends in March, but will
make a recommendation to a full ministerial meeting on March 27.

Pressure for an extension of the accord, which has sparked a
spectacular revival in global oil prices, was boosted on Thursday
by OPEC heavyweight Saudi Arabia, the dominant player in the 11-
member group.

Saudi oil minister Ali al-Naimi, speaking after a meeting with
Venezuelan oil minister Ali Rodriguez in Amsterdam, said it was
not necessary to act for the moment to change conditions in the
oil market in 2000, according to analysts.

This was echoed by ministers arriving in Vienna ahead of
Friday's meeting of the MMC group of oil ministers from Iran,
Kuwait and Nigeria, plus OPEC secretary general Rilwanu Lukman.

The meeting was expected to start about 15:00 GMT or 22.00
Jakarta time on Friday.

"We don't need to do anything in March," Kuwait's Saud Nasser
al-Sabah told reporters. "Beyond March we have to see. Maybe we
need to go through the year 2000," he added.

Venezuela's Rodriguez told AFP that the accord might stay.

"That is a possibility, but not a decision. It is too early to
say. We are now in January and the accord lasts until March. We
are studying it with other members. We have to wait until March,"
he said.

Oil prices, which slumped to historic lows prior an agreement
last March which shaved 2.1 million barrels per day off daily
production, soared to a nine-year high at the end of last year.

Prices rose sharply in London on Thursday following news of
the meeting between the Saudi and Venezuelan ministers. Market
analysts predicted the current ceiling could stay in place
through to the end of this year.

Rodriguez is in Vienna for talks about postponing a planned
summit in Caracas in March because of the devastating mudslides
in Venezuela last month.

The OPEC members are Algeria, Indonesia, Iran, Iraq, Kuwait,
Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and
Venezuela.

As key OPEC ministers gathered in Vienna, Brent North Sea oil
prices held firm early on Friday. Brent for February delivery
rose to US$25.20 a barrel in London's late morning trading from
an opening price of $24.98 a barrel. This was the same as at the
close of trade on Thursday.

Market prices rose sharply on Thursday, when al-Naimi,
speaking after a meeting with Rodriguez in Amsterdam, said it was
not necessary for the moment to act to change conditions on the
oil market in 2000.

Oil prices recovered from historic low points last March, when
producers agreed to rein in production by 2.1 million barrels per
day, including a 1.7-million barrel reduction by OPEC members.

Analysts predicted that prices would continue to fluctuate
around the 25-dollar mark.

"We are now left in a self-stabilizing situation," GNI
brokerage said. "If oil prices move too low, the chances that the
current accord will be extended increase. If prices increase,
then the chances of higher production increase." (03)