OPEC Nods To Demands For More Oil

Oil ministers from Saudi Arabia, Venezuela and Mexico agreed Thursday that oil exporting countries should boost production in an effort to ease global oil prices, which are at their highest levels in nine years.

The ministers agreed in principle to an unspecified production increase and said further details would come at the March 27 meeting of OPEC members.

"Uppermost in our minds is to maintain stability in the markets," said Saudi Oil Minister Ali Naimi. "There is need for additional production. The issue is when and how much."

Oil exporters have come under intense pressure in recent weeks from the United States and other major oil consuming nations to pump more crude and bring prices down.

Mexico, though not a member of the Organization of Petroleum Exporting Countries, agreed to cooperate with whatever decision the group reaches at the OPEC minister's meeting in Vienna, Austria.

Mexican Oil Minister Luis Tellez said demand has increased dramatically and "an increase in production is warranted."

The ministers refused to confirm the size of the expected increase.

"I think the number will be put forward when we finish our consultation with all other members," Naimi said.

The ministers refused to say what price they hoped to see for crude oil.

The world consumes about 77 million barrels of oil a day, but production has fallen to 75 million barrels a day. The tight supply has forced oil companies to draw on inventories that have fallen to dangerously low levels, leading to the sharp price increases in heating oil, diesel fuel and, more recently, gasoline.

OPEC accounts for about 30 percent of total worldwide oil production.

Prices surged after OPEC made deep cuts in production last March. OPEC has slashed output by 4.3 million barrels per day since the first round of cuts in 1998.

By Bruce Stanley
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