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To: RealMuLan who wrote (32101)	11/24/1998 4:36:00 PM
From: RealMuLan	Read Replies (1) \| Respond to of 95453

FOCUS-Shocked OPEC sees no escape from oil price crash Tuesday November 24, 1:58 pm Eastern Time By Richard Mably VIENNA, Nov 24 (Reuters) - OPEC oil producers gathered on Tuesday for their winter conference in a state of shock at the depths of a price crash they appeared powerless to resist. Ministers arriving in Vienna for Wednesday's meeting found a forceful reminder of the crisis that has played havoc with their petroleum-dependent economies in an Algerian bid for a rare heads of state summit. Algerian President Liamine Zeroual's call for a meeting of the leaders of oil exporting countries, possibly early next year, was one of the few signs that any new effort is underway to rally oil out of one the biggest slumps on record. But the chance of any immediate new action from OPEC in Vienna to siphon off a huge stockpile of oil and address stagnating global demand looked negligible. ''The oil community is looking for guidance from OPEC and OPEC is looking for guidance from someone else,'' said Peter Gignoux, head of energy at Salomon Smith Barney in London. Minority OPEC calls led by Algeria and Kuwait for tougher supply limits beyond the 2.6 million barrels a day package of restrictions agreed earlier this year look to have failed. Instead a damaging new row was brewing over allegations that key producers have leaked extra barrels onto glutted markets and undermined June's unprecedented supply management pact with exporters outside OPEC. ''There is 600,000 barrels per day of oil production over and above the pledged cuts,'' said a Gulf source familiar with thinking in Saudi Arabia, OPEC's leading policy maker. Saudi, for the time being, has ruled out more output curbs, insisting it wants full adherence to existing limits. That reflects Riyadh's concern that it not be left to shoulder the burden of supply restraint leaving rivals to grab extra market share -- a situation it vowed never to repeat after the last big oil slump of 1986. ''Let's first adhere to pledged cuts. After that we can assist the markets with whatever action is needed,'' the Gulf source said. That means ministers will consider only prolonging current measures by six months to the end of next year -- of little comfort to a market where benchmark Brent crude on Wednesday was valued at $11.24 a barrel, near historical lows. Oil this year, on average at $13.70 for Brent, is priced lower than at any time since 1976. Those are prices that Algerian Oil Minister Youcef Yousfi, on a lightning tour aimed at winning support for more production cuts, says are at ''dangerously low levels.'' ''Yes, there is too much oil in the market,'' agreed Iranian Oil Minister Bijan Zanganeh. Iran, though, and Venezuela, would appear to be the countries most clearly in contravention of June's supply curbs, say industry monitors. Venezuela stands accused of increasing output for domestic political reasons ahead of December presidential elections. And there are growing concerns that Iran is wavering on its promise to reduce supplies amid Tehran's claims it was asked to cut from too low a baseline.