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To: Captain James T. Kirk who wrote (30323)	10/4/1998 5:15:00 PM
From: Paul Angell	Respond to of 95453

Captain It looks like Tellez agreed to hold cuts through June 1999, in a meeting after hours. Regards, Paul. Pemex's Lajous-Oil-cut extensions to affect E&P CANCUN, Mexico, Oct 2 (Reuters) - The chief of Mexico's state-owned oil company Pemex on Friday said Pemex's 1999 exploration and production investments will be affected by an agreement reached Friday at talks in Cancun with Venezuelan and Saudi Arabian oil officials to extend historic oil-supply cuts approved earlier this year. "We are, at this moment, revising integrally the investment budget of Petroleos Mexicanos (Pemex) for 1999 and, certainly, there will be an effect on various programs, both in exploration and production, as in other industrial activity," said Pemex's chief Adrian Lajous. "I am talking about adjustments, not significant reductions." Mexico, which is not a member of the Organization of Petroleum Exporting Countries, helped OPEC members Venezuela and Saudi Arabia spearhead the historic agreements reached in March and June to cut global oil supply by 2.5 million barrels per day. But Mexico had agreed to cut only its oil exports - by 200,000 bpd - instead of domestic production. On Friday, after the closed-door talks between the trio of oil producers had ended in Cancun, Mexico's energy minister Luis Tellez said Mexico had agreed to extend its cutbacks in oil exports to June 30, 1999. Those export cuts originally had been set to expire at the end of this year. On Thursday, Pemex said its crude oil exports averaged 1.65 million barrels per day in September. For the third quarter, crude exports averaged 1.64 million bpd, down from 1.79 million bpd in 1997's third quarter, Pemex said. In releasing those figures late Thursday, Pemex said the numbers confirmed Mexico's full compliance with the export cuts it had agreed to in the pacts approved in Riyadh and Amsterdam earlier this year. Falling world crude oil prices this year have hurt both Mexico's federal budget and Pemex. World crude prices are still at their lowest levels, in real terms, since the early 1970s, despite a recent rebound to about $16 a barrel from a low of $11.40 in mid-June. On Thursday, Pemex said the average realized price in September for Mexico's crude export basket was $10.93 a barrel, and for the entire third quarter, the average realized price was $10.51 a barrel. ((Michael Christie, Cancun, Mexico))

To: Captain James T. Kirk who wrote (30323)	10/4/1998 5:19:00 PM
From: Paul Angell	Read Replies (1) \| Respond to of 95453

Captain, And another article: IPE Brent surges on short covering, Mexico meet LONDON, Oct 2 (Reuters) - IPE Brent crude oil futures surged late Friday to set the day's new highs on pre-closure short-covering in case Saudi Arabia, Venezuela and Mexico agreed further output cuts, traders said. At 1930 GMT, November Brent last traded 28 cents higher at $14.39 a barrel, recovering from the day's low of $13.93 triggered by a sell-off in New York and swiftly followed by locals in London. It later settled up 25 cents at $14.36. November NYMEX last traded 24 cents firmer at $15.67 a barrel. IPE gas oil earlier settled $2 down at $123.25. "It's short-covering before the weekend, not any real news yet," said one IPE trader referring to Brent's rally. "There are some shorts in the market. People are covering in case something comes out of the Mexico meeting." "People want to cover themselves before they return to work on Monday should there be an agreement on cuts at the weekend," said another trader. Before Brent's late rally, traders said if the November contract pierced resistence at $14.22, buy stops would likely be triggered. Heavyweights Saudi Arabia, Venezuela and non-OPEC Mexico were meeting in Cancun, Mexico, on Friday and were due to hold a news conference at 2130 GMT, over two hours after NYMEX closed. Although the oil ministers of Venezuela and Mexico had dampened market expectations for output cuts by saying that the topic was not on the agenda, some media reports suggested that Mexico could be put under pressure to extend its accord of 200,000 barrels per day export cuts beyond the second half of 1998, traders said. Saudi Arabia has also been reported possibly proposing further cuts if necessary together with other Mideast Gulf producers if Venezuela and Mexico agreed to maintain production at current levels. ((London Newsroom +44 171 542 5387, fax +44 171 542 4453, london.energy.desk@reuters.com)) <0#CL:> NYMEX crude <0#LCO:> IPE crude <0#HO:> NYMEX heating oil <0#LGO:> IPE gas oil <0#HU:> NYMEX gasoline energy speed guide crude speed guide products speed guide [O/I] INSIGHT report [OPEC] OPEC [NSEA] North Sea [CRU] crude oil [PROD] oil products [DRV] derivatives [CRU/E] European crude