ECONOMY
OPEC MAY RAISE QUOTAS TO PREVENT FURTHER PRICE RISES
Speaking days after crude prices were driven to record highs amid concerns over supply, Mr. Purnomo said OPEC was capable of beefing up production because of excess capacity.
'The possibility is always open. We have over-capacity, so it can be increased,' he told reporters, adding that the measure would be discussed at the next OPEC meeting in Vienna on Sept 14.
Mr. Purnomo said that although OPEC'S ceiling currently stood at 26 million barrels per day, due to over-production and extra output from Iraq not subjected to the organization’s quotas, it was delivering an extra four million.
'Production is already 30 million barrels so it can be increased. This will be discussed in further detail (in September),' he said.
Mr Purnomo said that the OPEC meeting would also be opened to non-members. 'OPEC will discuss steps to stabilize world oil prices with non-OPEC countries and large oil producers, among them Russia and Angola. We will discuss world oil price conditions.'
Supply uncertainties caused by the financial woes of Russian oil giant Yukos and terrorist attacks on Iraqi pipelines have sent prices soaring in recent weeks, prompting OPEC to consider a hike in production. But Mr. Purnomo, who last week branded oil prices 'crazy', has said a decision whether to increase supplies cannot be made before the Vienna talks. He said there were no plans to bring the meeting forward.
Meanwhile, oil prices rose back towards record highs yesterday as a Shi'ite Muslim uprising threatened to engulf Iraq's oil industry. US light crude rose 40 US cents to US$44.35 a barrel, less than 50 cents shy of Friday's record of US$44.77, the highest price since the New York Mercantile Exchange launched oil futures in 1983.
Prices rose as Iraqi armed militia roamed the southern oil production center of Basra and insurgents hit the oil ministry compound in Baghdad.
