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Saturday, 11 May, 2002, 13:08 GMT 14:08 UK
Arab leaders pledge oil stability
Oilrig
Oil supply fears saw prices rise between January and April
Arab leaders have condemned attempts to use oil as a political weapon in the Middle East conflict.

Egyptian President Hosni Mubarak
Mubarak: No pressure on West
At a meeting of Arab oil producers in Cairo, Saudi Arabia, Egypt and several other major oil producers pledged to ensure stability of the world's oil market.

Egyptian President Hosni Mubarak said the conference was an opportunity to "proclaim before the world that we respect the consumer and we want to satisfy his needs and the stability of his economy.

"We do not resort to pressure but we resort to dialogue," he told the meeting in a statement.

In an attempt to further reassure the industrial economies, Saudi Arabia - world's top oil exporter - said it had necessary extra capacity to compensate for any world shortage.

"Saudi Arabia considers the stability of the market to be important in both the short and long term," Saudi Oil Minister, Ali al-Nuaimi, said.

The statements followed the Iraqi calls on Arab states to join it in reducing the world's oil supply as a means of applying pressure in support of the Palestinians.

President Mubarak has now gone to the Red Sea resort of Sharm el-Sheikh for talks with the leaders of Syria and Saudi Arabia on the Middle East crisis.

Nervous market

The Cairo meeting came ahead of talks on oil production quotas by the Organisation of Petroleum Exporting Countries (Opec).

The oil market has reacted nervously to reports that Israel was preparing to launch an offensive against the Palestinians in the Gaza Strip in retaliation for a suicide bombing that killed 16 people near Tel Aviv.

Iraq temporarily stopped oil exports last month in retaliation for Israel's onslaught on the Palestinian towns in the West Bank, but it later resumed deliveries as other oil producers did not follow the move.

Opec has been under pressure from industrial countries to increase oil production to check the rise in oil prices.

The organisation slashed its total output by 1.5 million barrel per day on 1 January for six months, under an agreement with independent producers to push up the prices.

See also:

02 May 02 | Middle East
Arafat urged to act for peace
01 May 02 | Business
US petrol price row ignites
05 May 02 | Middle East
Iraq to resume oil exports
02 May 02 | Business
Shell profits almost halved
31 Dec 01 | Business
Tide turns against the oil firms
28 Dec 01 | Business
Opec cuts exports to boost prices
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