OPEC secretary general dismisses possibility of a price war

Wednesday, November 28th 2001, 12:00 am
By: News On 6

CARACAS, Venezuela (AP) _ Despite a standoff over reducing oil output, there won't be a price war between OPEC and independent oil producing nations, the cartel's secretary general told a Venezuelan newspaper.

Ali Rodriguez said the Organization of Petroleum Exporting Countries will not increase production to pressure non-OPEC oil nations to reduce their own.

``Zero price war, zero pressure on other oil producing nations,'' Rodriguez was quoted as saying in an interview published Wednesday in the Caracas daily El Universal.

On Tuesday, OPEC President Chakib Kheli urged Russia and other countries outside the cartel to cut oil production to stabilize plummeting prices.

``If (Russia) doesn't ... cooperate with other countries, I think that it will have a lot of problems,'' Khelil told France-Inter radio.

Earlier this month, OPEC agreed to cut production by 1.5 million barrels a day on Jan. 1 but only if independent producers contribute with a 500,000 barrels a day reduction. The cartel is trying bolster oil prices, which have fallen more than 30 percent since the Sept. 11 attacks.

Independent producers Mexico, Norway and Oman have agreed to slice their output, but Russia, the world's second largest exporter, has only pledged a symbolic cut of 50,000 barrels a day.

Rodriguez reiterated that OPEC will not trim output on its own. ``That would be a useless sacrifice,'' he said.

The 11-member OPEC has already reduced its production by 3.5 million barrels a day this year.

On Tuesday, January crude oil futures jumped 79 cents to $19.48 a barrel at the New York Mercantile Exchange on concerns that the war on terrorism might extend to OPEC member Iraq.