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To: Big Dog who wrote (17068)	3/29/1998 1:22:00 PM
From: pz	Respond to of 95453

Sunday March 29, 7:56 am Eastern Time OPEC assembles to seal output cut, extend rally (Adds Indonesian arrival, fresh delegate, Kuwaiti quotes) By Neil Fullick VIENNA, March 29 (Reuters) - OPEC oil ministers were assembling on Sunday to confirm a landmark pact to choke swollen output in concert with other producers and extend a fledgling price rally. An emergency meeting of the producer club on Monday is expected to approve its contribution to a reduction of around 2.3 percent in global output to mop up a big glut in supply. Other major producers outside the cartel have taken the unprecedented step of joining hands with OPEC in pledging cuts to sacrifice 170,000 barrels per day (bpd) on top of OPEC's reduction of 1.25 million. More cuts could come from non-OPEC Norway later this week, raising hopes for a further rally in the price of the lifeblood of industrial economies from 25-year lows in real terms earlier this year. And OPEC members themselves may be willing to make larger cuts than originally proposed in the pact to support the price of the world's most important strategic traded item, OPEC delegates said. Kuwaiti Oil Minister Sheikh Saud Nasser al-Sabah called on all non-OPEC countries to join the agreement to drain excess supply from saturated markets. ''We hope that many countries outside OPEC pay attention to their main interests ... The world market is now flooded with oil,'' he said in Kuwait before leaving for Vienna. He said the exact size of the cut by OPEC and non-OPEC countries had not yet been finalised. Nigerian Oil Minister Dan Etete and Indonesia Mines and Energy Minister Kuntoro Mangkusubroto were the first to arrive for the meeting. The agreement with non-OPEC powers, if it sticks, would mark an unprecedented expansion of influence for the group founded in 1960 to protect the interests of sellers. The pact agreed by Saudi Arabia, Venezuela and non-OPEC Mexico in Riyadh on March 22 has drawn support from all 11 OPEC members bar Iraq plus Oman, Egypt and Yemen. Norway is expected to announce its support this week. Prices have gained $2 a barrel since the accord came to light and are $3.50 up from lows seen earlier this month. But markets are keenly watching for signs of whether the promised reductions in output will be any more effective at supporting prices than the cartel's much-abused quota system. One of the group's main priorities will be to avoid any sign of dissension over reducing volumes that could stampede jittery markets into a price slide. The West's energy watchdog, the International Energy Agency, cautioned last week that even if the agreement held it would not reduce all of the excess supply in the market. IEA executive director Robert Priddle recalled that OPEC has found it difficult to restrain output in the past under its ramshackle system of production allocations. OPEC watchers say the group has rarely been enough of a cartel to set quotas tight or leakproof enough to hold prices at the high levels to which -- at intervals -- crisis in the Middle East has propelled them. But one harbinger of harmony in Vienna was an apparent truce between Saudi Arabia and Venezuela in their long-running dispute over the need to shut in capacity for the common good. Saudi Arabia, the world's largest producer and exporter, has called for output discipline to support prices while Venezuela has pumped at capacity to maximise market share. OPEC insiders say the two countries' collaboration on the pact means the omens are good. ''You will see history repeating itself. It is the story of OPEC's survival all over again,'' a Gulf Arab oilman said.