Brussels, 15/01/2001 (Agence Europe) - The United States and the European Union have joined forces in calling on OPEC countries to limit the reduction in oil production to a minimum, which should be decided during the meeting of the oil cartel on Wednesday in Vienna.
In order to bring the price of a barrel of oil to $25, currently $22, OPEC would be preparing to reduce production by 1.5 million barrels per day. Saudi Arabia is pressing for a reduction of between 1.5 and 2 million barrels, and Iraq has called for a 3 million barrel reduction. According to information from AFP, US Energy Secretary Bill Richardson, currently in the Gulf countries, invited the producer countries to reduce production by 1 million barrels daily in two stages: 500,000 barrels/day on 17 January and 500,000 barrels/month later.
European Commissioner for Energy Loyola de Palacio and US Secretary Bill Richardson published a joint press release after a lightning meeting in Paris, on Friday evening. They call on OPEC countries to show caution in order to prevent another price explosion. They recall that the "oil market is beginning to be stabilised and stocks are forming again, thanks to the four production increases decided last year by the producer countries, at a total level of 4 million barrels/day". Oil stocks are still 5% below their level last year and should be built up again, stressed Bill Richardson during his trip to Abu Dhabi on Sunday. The producer countries must avoid intervening too rapidly and take into account the fact that the States are rebuilding their stocks, stressed Ms de Palacio's spokesman on Monday.
The ideal price of a barrel of oil would be $20 but $25 would be "acceptable", the spokesperson for the Commissioner, Gilles Gantelet, told the press. Bill Richardson had also described as "adequate" the price of $25. Ms de Palacio and Mr Richardson insisted that, at any rate, the OPEC decision should not bring about a sharp rise in prices, and would be made in consultation with the consumer countries.
"Dialogue must not be all one way, solely when prices go up", remarked the spokesman for Ms de Palacio, specifying that Europeans can understand that OPEC does not wish its prices to fall below $20. "We expect practical proposals in the coming weeks for establishing the permanent secretariat for dialogue between consumer countries and oil producing countries, the creation of which was decided at the meeting in Riyadh last November", he recalled.