OPEC Hit by Charges of Cheating : Nigeria Says Cartel Should Oppose Cut in Prices, Production

Nigeria’s oil minister, in Vienna for preliminary OPEC talks, said Thursday that all 13 member governments of the petroleum cartel have been cheating on price agreements.

Tam David-West told reporters upon his arrival that the Organization of Petroleum Exporting Countries should not cut prices or production at the conference that opens today.

“Our problem is indiscipline and not telling the truth,” David-West said as the OPEC oil ministers gathered under security conditions that police said were the strictest for any OPEC meeting in the Austrian capital.

OPEC ministers are badly divided on what measures should be taken to try to revive oil demand and restore solidarity to their group. They are under pressure from market forces to reduce prices, but some countries--led by Libya, Algeria and Iran--have said they will firmly oppose any reductions. They favor further cutbacks in production.

Industry analysts have said the meeting is likely to be one of OPEC’s most difficult. The group is weakened by a decline in demand for its oil and increased production by Britain and other nations outside the OPEC sphere and has been unable to halt the slide in prices.

All Offering Discounts

Nigeria’s David-West said “there is not one single” OPEC member country that is not violating cartel rules by offering discounts on official prices.

The discounts are being offered because the OPEC nations cannot sell enough oil at the official price of $28 a barrel to meet government revenue targets.

David-West’s remarks came as an advisory panel of six OPEC ministers met at OPEC headquarters. They were to recommend a course of action for the full-scale conference today at a Vienna hotel.

OPEC’s current production ceiling is 16 million barrels a day, although actual output is estimated at about 14.5 million barrels.

Joseph Stanislaw, director of international economics in the Paris office of Cambridge Energy Research Associates, a private consulting firm, said Thursday that the most likely outcome of today’s meeting would be a cut of $1 or $1.50 in OPEC’s basic price.

Each reduction of $1 a barrel, if adopted by all producers and passed on entirely to consumers, would be the equivalent of a cut of about 2 1/2 cents a gallon in the retail price of gasoline and other refined petroleum products.