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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (62030)	3/13/2000 9:08:00 AM
From: Post_Patrol	Read Replies (2) \| Respond to of 95453

The Patrol sold off all OSX holdings last Tues. will re-enter OSX 85-90

To: Tomas who wrote (62030)	3/13/2000 9:12:00 AM
From: Wowzer	Respond to of 95453

Today's WSJ: March 13, 2000 OPEC May Agree to Raise Oil Output, But Not Enough to Meet World Demand By STEVE LIESMAN Staff Reporter of THE WALL STREET JOURNAL The Organization of Petroleum Exporting Countries is moving toward an agreement to increase production by 1 million to 1.5 million barrels a day at its meeting later this month, according to two officials from major petroleum-producing nations. Both officials, who are familiar with OPEC's discussions, cautioned that talks are continuing and that the amount could change before the March 27 meeting in Vienna. The officials also said that whatever figure is agreed upon will be in addition to the approximately one million barrels a day OPEC already is producing above its agreed quotas. "There will be new oil," one of the officials said. Along with non-OPEC producers Mexico and Norway, the 12 OPEC members last year agreed to take about five million barrels a day off world markets to soak up an oil glut, a move that resulted in crude prices' nearly tripling. In response to prices that have risen to about $31 a barrel for West Texas Intermediate, an industry benchmark, refiners have cut gasoline production in the face of weak profit margins. That has led to concerns that gas prices will soar even higher this summer and possibly lead to shortages. The figure that OPEC is now discussing would still leave the world short of crude by the end of the year. World oil demand in the fourth quarter was 2.6 million barrels a day higher than output, according to the International Energy Agency, the Paris-based energy watchdog for the industrialized nations. It said in a report Friday that the world needs 2.3 million barrels a day of new oil during the rest of this year to return inventories to more normal levels. The officials from the oil-producing nations said the difference could be addressed in subsequent increases later in the year. "That's a possibility as well," one official said. "Right now the consensus is to have a gradual increase, but the question is how gradual it will be." While several influential members of OPEC support raising production, they don't want prices to collapse. OPEC could couple a smaller-than-necessary increase with vague assurances of more oil later, which could bring down prices gradually. The IEA report suggested that not all the additional oil is needed in April. But David Knapp, editor of the agency's Monthly Oil Market Report, said, "it's going to be a horse race to turn whatever oil OPEC puts on the market fast enough into gasoline" in time for the summer driving season. An OPEC plan that keeps markets guessing could backfire. Oil producers have been surprised at the current high prices in light of their discussions of higher output. Traders say what is needed is more oil, not talk of more oil. Producers have been adept at fomenting uncertainty in markets. Last week, Iran indicated that it backed a production increase. But on Sunday, Iran's oil minister, Bijan Namdar Zanganeh, said his country's opposition to boosting output hasn't changed. He said, "No decision has been made [by OPEC] about whether or not to increase production levels." Venezuela, thought to have been a supporter of higher output, muddied the waters itself when its oil minister said OPEC is "unlikely" to increase production in April. Some analysts suggest Venezuela may be equivocating because its production has declined over the past year and it has less to gain from an increase. While Mexico and Saudi Arabia have said they want to act in concert with other producers, both countries have strongly suggested they could act on their own to ensure markets have sufficient oil. Write to Steve Liesman at steve.liesman@wsj.com