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To: Les H who wrote (37905)	1/24/2000 7:33:00 PM
From: Les H	Read Replies (1) \| Respond to of 99985

FOCUS-Oil powers dismiss oil price spike as "blip" (New throughout to include Mexican and Venezuelan ministers' comments, radio interview, background) By Tom Ashby CARACAS, Jan 24 (Reuters) - Oil powers Venezuela and Mexico on Monday dismissed the latest jump in world prices, which hit nine-year highs last week, as a speculative ``blip' and stuck to their commitment to keep a tight rein on exports. Arguing that demand will dip seasonally in March, the two key oil policy-makers said there was no reason to consider easing exports curbs despite warnings from consumers that they need more oil to stave off a shortage. ``We in OPEC have agreed to work for the stability of the market and what is happening (with high prices) is a short-term phenomenon,' Venezuelan Energy and Mines Minister Ali Rodriguez said after a meeting at the Miraflores presidential palace. ``To a large extent it reflects the role of speculators,' he added. His comments followed Mexican Energy Minister Luis Tellez's, who dismissed the recent price spike as ``a blip' caused by a cold snap in the United States. Venezuela and Mexico are two members of a trio, including top producer Saudi Arabia, which masterminded the global oil supply cuts which have taken prices to their highest level since the 1991 Gulf War. Benchmark Brent crude oil prices have risen steadily for almost a year, but they jumped $4 per barrel in the last two weeks to $27 per barrel after key exporters indicated they want to extend the cuts beyond their original March expiry. Still suffering from last year's price crash, which took prices to their lowest level in more than a decade, producers are reluctant to relax restrictions just as demand eases during the summer months in the northern hemisphere. ``The demand situation has improved, inventories are reaching acceptable levels for us, so we are moving towards a stabilization of the markets,' Rodriguez said later in a radio interview. ``But we know that in March there will begin a cycle of falling demand which tends to reduce prices and what we are looking for is not excessive prices, but not too low either,' he added. Some economists believe public talk of stabilizing the oil market for the benefit of producers and consumers is just shorthand for pushing prices as high as consumers will bear. The International Energy Agency, a Paris-based energy watchdog for the western world, predicts oil inventories will continue to fall sharply in the second quarter if oil producers extend their cuts. U.S. Energy Secretary Bill Richardson said last week he was concerned about the rally and plans to meet some key producers over the next few weeks, while European authorities are worried it may fuel inflation. The OPEC cartel is due to meet on March 27 in its Vienna headquarters to decide policy from April onwards, but the trio is likely to meet beforehand to hammer out a policy outline for the fractious 11-member group.