Newspaper article THE JOURNAL RECORD

Kuwait Sticks to Production Hike Demands

Newspaper article THE JOURNAL RECORD

Kuwait Sticks to Production Hike Demands

Article excerpt

GENEVA (AP) _ Kuwait stuck to its demand for a hefty increase in oil production Tuesday, while other members of the Organization of Petroleum Exporting Countries worried that any move to increase output this summer would send crude prices into a slump.

Kuwait's insistence on a bigger production quota could stall bargaining at the summer conference of the 12-nation cartel, which opened Tuesday. The emirate, devastated by the Gulf War, wants to pump more oil so it can pay rebuilding costs.

Other leading producers repeatedly urged caution in an attempt to get Kuwait to soften its demands and protect already weak prices.

"Because of the price, we should not put more barrels (of oil) on the market," said Saudi Arabia's influential minister, Hisham Nazer. The kingdom is OPEC's biggest producer, pumping about 8 million barrels of crude a day, a third of the cartel's total supply.

Kuwaiti oil minister Ali al-Baghli seemed to signal a willingness to be moderate by telling reporters he would be flexible in the bargaining. But later, a senior Kuwaiti delegate, speaking on condition of anonymity, said the emirate's position was firm, and he dismissed suggestions his country would back down from earlier requests for a higher production quota.

In the past, Kuwait demanded an increase in its quota of 400,000 barrels a day, for a total limit of 2 million barrels a day in the third quarter.

But other producers worry that since OPEC is already overproducing, a surge in crude on the market would send prices plunging. Moreover, if Kuwait won a higher quota, other nations such as Nigeria would insist on added barrels.

The shifting signals from the Kuwaiti delegation first sent prices sharply higher Tuesday on the New York Mercantile Exchange, then contributed to a sell off. Light sweet crude finally settled 11 cents per barrel higher at $19.65.

The average price of a basket of crudes monitored by OPEC last week was more than $3 a barrel under the cartel's $21 a barrel benchmark. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.