OPEC Inclined To Cut Production
Monday, February 19th 2001, 12:00 am
By: News On 6
CARACAS, Venezuela (AP) â€” The Organization of Petroleum Exporting Countries is leaning toward cutting production during a semiannual ministers' meeting next month, the cartel's secretary general said on Monday.
OPEC Secretary General Ali Rodriguez said global oil demand could drop by 2 million barrels a day when warm weather sets in in the second quarter. He added that the cut would not exceed 1 million barrels a day.
``Yes, the inclination ... was that we need to cut oil, because during the second quarter there's always a significant decline in oil demand,'' Rodriguez said during a radio interview from London.
Rodriguez, who is Venezuela's former oil minister, made his statements one day after President Hugo Chavez met with Saudi Arabian King Fahd and Crown Prince Abdullah during a three-day visit to the OPEC heavyweight. A Venezuelan diplomat said the two OPEC leaders discussed oil market conditions and prices. Chavez will visit OPEC member Qatar for one day on Wednesday.
Under Chavez, Venezuela has become one of OPEC's most hawkish members. Chavez has recently rallied for prices to remain between $25 and $28 â€” the higher end of OPEC's price band.
OPEC sliced output by 1.5 million barrels a day last month in anticipation of a seasonal fall in demand in the second quarter.
Rodriguez assured that OPEC would consider new tensions in the Middle East and distribution problems in the United States before deciding whether to cut.
He added that OPEC is committed to keeping prices within its band mechanism â€” $22 to $28 a barrel.