Opec dissent on Saudi oil output move

Dissent emerged in Opec yesterday after Saudi Arabia announced unilateral plans to raise supply and asked Opec to endorse a big increase in cartel output limits to lower crude prices.

Hopes that the Organisation of the Petroleum Countries might swiftly back a Saudi plan to lift supply limits by 2-2.5 million barrels daily, 8-11 per cent, have been dashed.

Some in Opec are angry that Riyadh has decided to lift its production to just over nine million barrels daily next month, a rise of about 10 per cent, without Opec approval.

"They can't. It's a mistake. Saudi Arabia can't decide alone to increase production," Libya's Oil Minister Fethi bin Chetwane told reporters.

The comments bode ill for Opec unity at a time when US oil prices are near 21-year highs, peaking last week at $41.85 a barrel. US Energy Secretary Spencer Abraham said Saudi had promised to raise next month's output to 9.1 million barrels a day, slightly more than the nine million indicated in a statement from Saudi Oil Minister Ali al-Naimi on Friday.

"Minister Naimi stated to me that Saudi Arabia is fulfilling all genuine requests for June (next month) for a total of 9.1 million barrels a day and stated that going forward they will meet all requests up to their capacity of 10.5 million bpd," Mr Abraham said. The officials representing the world's biggest oil producing and consuming nations spoke during an energy forum in Amsterdam.

The Saudi effort would put an extra 800,000 barrels a day of oil on the world market next month, up 10 per cent from its estimated April output of 8.3 million.