OPEC Meets on Production but Fails to Agree

Hard-line OPEC members Iran, Libya and Algeria held out Sunday against a proposal to cut the cartel’s oil production only slightly this summer, insisting that deep cuts were needed to shock the oil market out of its price slump.

Ministers of the 13-nation Organization of Petroleum Exporting Countries met formally for less than an hour Sunday. Ahmed Zaki Yamani, Saudi Arabia’s oil minister, said later that they were “a long, long way” from a comprehensive agreement.

Some ministers held informal talks later Sunday in their hotel suites. OPEC spokesman James Audu said the formal conference, which began last Tuesday, would resume today.

Production Limits

The cartel leaders could still agree on an overall production target without deciding how to divide it among members. Such a conclusion would not be expected to push oil prices much higher.

Ten of the 13 member countries indicated Saturday that they would accept a proposal from OPEC’s technical advisers to limit oil production to 16.3 million barrels a day in the July-September quarter and 17.3 million barrels daily in the year’s final quarter. OPEC is now pumping about 17 million barrels a day, having effectively discarded all price and production controls late last year.

Members hope that new production controls would bring world oil supplies closer into line with demand, thus gradually pushing up prices. Prices are averaging $12 to $15 a barrel, half the level of three months ago and the lowest since the mid-1970s.

Over the past week, the oil ministers all but gave up trying to agree on immediate cuts in production.