RI's proposed OPEC meeting receives guarded response

RI's proposed OPEC meeting receives guarded response

JAKARTA (JP): Libya is the only member of the Organization of
Petroleum Exporting Countries (OPEC) to officially support an
Indonesian proposal for an emergency meeting to address a slump
in world oil prices.

An OPEC official at the Ministry of Mines and Energy who asked
for anonymity said yesterday most OPEC members had expressed
unofficial support for the proposal, but were ready to hold such
a meeting only if it guaranteed to produce a concrete solution to
improve oil prices.

"The members consider that if the meeting brings no result, it
would bring the international oil market into danger. Prices
might experience a free fall," he said.

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

Minister of Mines and Energy I.B. Sudjana, who is also OPEC's
president, recently called on the grouping to meet to discuss
falling oil prices and demand.

Oil prices have fallen 30 percent since last October with
world benchmark Brent crude oil trading at $13.73 per barrel last
week, the lowest level since 1994.

Analysts say the decrease is due to a mild winter, a slowdown
in Asian demand and an increase in OPEC supply.

The source said Libya sent a letter to the OPEC secretariat in
Vienna, confirming that it agreed to the meeting but proposing
that it be held after a soon-to-come meeting of OPEC's
Ministerial Monitoring Subcommittee (MMC).

The MMC, composed of Iranian, Indonesian and Nigerian
officials, monitors OPEC member's quota compliance. The
subcommittee will hold its meeting March 16 in Vienna.

The official said OPEC Secretary-General Rilwanu Lukman was
currently contacting group members to establish a pre-meeting
consensus which could produce a smooth and conclusive meeting.

"It's a kind of preparation so that ministers would only need
to fine-tune their positions," he said, noting that all OPEC
decisions are based on consensus.

Several members, including the United Arab Emirates, Saudi
Arabia, Iran and Kuwait, have hinted they would support an
extraordinary meeting.

Saudi Arabia and Iran expressed over the weekend a willingness
to work together toward correcting the sharp decline in oil
prices and voiced their concern over quota breaking by other
member states.

Kuwait also said it might agree to the meeting provided that
all members pledge to abide by their quotas.

OPEC raised its ceiling oil output to 27.5 million barrels per
day (bpd) from 25.03 million bpd during its ministerial meeting
last November in Jakarta.

But analysts say OPEC's real output is higher than the ceiling
because most members break their quotas.

Indonesia has a quota of 1.456 million bpd.

The proposed extraordinary meeting may also be discussed in
the upcoming MMC meeting, according to the source. (jsk)