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To: banco$ who wrote (23382)	11/24/1998 7:30:00 PM
From: goldsnow	Respond to of 116753

FOCUS-Shocked OPEC sees no escape from oil price crash 04:14 p.m Nov 24, 1998 Eastern By William Maclean VIENNA, Nov 24 (Reuters) - OPEC producers gathered on Tuesday for their winter conference stunned at the extent of a price crash the oil cartel appears 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 slim. ''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 for tougher supply limits beyond the 2.6 million barrels a day package of restrictions agreed earlier this year look to have failed. ''I'm in favour of more cuts -- it is a very dangerous situation,'' said Libyan Oil Minister Abdullah al-Badri on his arrival in the Austria capital. But such an initiative found little favour among OPEC big guns Saudi Arabia, Venezuela and Iran who instead appear intent on indulging in the familiar cartel pastime of squabbling over output discipline. A damaging new row was brewing over allegations of extra barrels leaked onto glutted markets that are undermining 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 -- little comfort to a market where benchmark Brent futures on Wednesday were valued at just $11.19 a barrel, near historical lows. Oil this year, on average at $13.67 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. But independent monitors said Iran and Venezuela would appear to be the countries most clearly in contravention of June's supply curbs. 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. Copyright 1998 Reuters Limited