OPEC must prepare for further oil cuts - Kuwait
06:25 a.m. Aug 29, 1998 Eastern
KUWAIT, Aug 29 (Reuters) - Kuwait has reiterated the need for fellow OPEC states to prepare for a third round of oil output cuts if world prices failed to recover by October.
''Raising North Sea Brent to $17 a barrel by October remains the objective and if it is not achieved we must move, according to the agreement, to reassess OPEC's current production policy,'' Kuwait's Oil Minister Sheikh Saud Nasser al-Sabah told Asharq al-Awsat in an interview published on Saturday.
''This position is not that of Kuwait alone, but is the position of all states which seek to boost oil prices,'' he added.
Sheikh Saud earlier this month told Reuters that the Organisation of Petroleum Exporting Countries might be forced to cut the overall ceiling when it meets in November if North Sea Brent failed to rise to $17 a barrel.
Benchmark North Sea Brent crude on Friday ended at $12.58, above the psychological $12 level but a third below last year's average price and close to a 10-year low of $11.55 set earlier this month.
''Any meeting among oil producing states to discuss measures aimed at improving prices represents a strength for the market in the right direction,'' the minister was quoted as saying.
The current move by the United States to increase its strategic oil reserves is ''positive because it implies the use of current reserves and (thus) the emergence of an increased demand for oil,'' he added.
OPEC decided in November to raise the overall production ceiling by 10 percent to 27.5 million barrels per day (bpd), but has since agreed on two rounds of cuts of a total 2.5 million bpd.
Kuwait, which controls about 10 percent of world proven oil reserves, announced last week that it would cut oil output in September by 60,000 bpd to bring its production fully into line with its pledged OPEC output commitment of 1.98 million bpd.
State-owned Kuwait Petroleum Corporation added it would consider making a further reduction of 80,000 bpd from planned maintenance shutdowns at refineries in Kuwait in October.
((Kuwait newsroom, +965 240 8945, fax +965 241 2459))
STR SAA
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