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The BBC's Rory Cellan-Jones
"Most OPEC countries are already pumping as much oil as they can"
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Chairman of the Wood Group, Sir Ian Wood
"What we want in the UK is stability"
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Tuesday, 12 September, 2000, 10:09 GMT 11:09 UK
World 'faces oil crisis'
Opec meeting in Vienna
Opec due to meet again in November to review prices
Oil prices continued hovering around 10-year highs on Tuesday after the president of the Organisation of Petroleum Exporting Countries said the world was in danger of facing a serious oil crisis.

We said before we intend to bring the price down and we will bring it down

Saudi oil minister
Ali al-Naimi
Crude oil futures gained 14 cents in after-hours ACCESS trading in New York to reach $35.28 a barrel, having already climbed by more than $1.50 on Monday.

In London, Brent crude oil futures were up 51 cents at $34.13 a barrel at 1000 GMT, having hit a decade high of $34.60 last week.

The fresh price rises followed comments by Ali Rodriguez, who is also Venezuela's oil minister, who said on Monday: "We are approaching a crisis of great proportions because oil production capacity is reaching its limit".

He was speaking after an Opec conference at which the organisation had agreed to raise oil production by 800,000 barrels a day from 1 October.

He claimed there were many factors behind the current high price of oil, such as refinery bottlenecks, transport restrictions, high taxes in oil importing countries and speculation on the financial markets.

Saudi Arabia, he said, was one of the few countries left with spare capacity and it could act as a "tuning producer" to try to settle the crude oil price at Opec's $25 a barrel target.

The price of oil initially eased from its recent highs after Opec announced the production increase, but later on Monday it climbed again, as the markets were unconvinced that the increase would be enough.

Analysts said the higher price reflected disappointment at the "modest" level of the 800,000 barrel a day production rise.

They said strong demand over the winter months combined with a continuing squeeze on supply would keep prices firm in the short-term at least.

Further action

Opec ministers say they might increase output again when they meet on 12 November.

"We always have that choice," Saudi Arabian oil minister Ali al-Naimi said.

He also said: "We are not happy. We said before we intend to bring the price down and we will bring it down."

Given the difficulty Opec is having in getting the price to drop and stay down, the ministers may decide they need to act much sooner.

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See also:

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Arab world blames Western freeloaders
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