OPEC Agrees to Seek Higher Prices : Oil: Iraq, Kuwait publicly gloss over tensions as cartel members negotiate setting cost of crude, production quotas.

OPEC oil ministers said today that there was general agreement among them to try to raise oil prices, and feuding cartel members Kuwait and Iraq publicly played down their differences over production quotas.

“We will have a new minimum reference price,” Algerian Oil Minister Sadek Boussena, OPEC’s new president, told reporters after the first two-hour session of the cartel’s midyear meeting. “There are several positions but all of them are accepting higher prices.”

Libya indicated that it wanted a higher quota for itself before it would agree to an overall production cap that would bolster prices, and Iraq wants a higher target price than some other members.

But ministers expressed optimism that they would reach an accord. Saudi Arabia’s oil minister, Hisham Nazer, said the ministers wanted a strong pact to help in “getting OPEC back on its feet.”

In the days leading up to the Organization of Petroleum Exporting Countries conference, Iraq had threatened to retaliate, possibly with military force, against Kuwait and the United Arab Emirates, which it accused of exceeding production quotas.

At today’s gathering, Kuwait and Iraq made a show of friendliness amid indications that behind-the-scenes talks had cooled down their dispute.

Iraq’s oil minister, Issam Abdul-Rahim Chalabi, asked whether he would press his country’s concerns about excess production, said: “We have discussed performance . . . and we are going to concentrate on what needs to be done from now on.”

Seated next to him in the conference room at a luxury Geneva hotel was the Kuwaiti delegation.

“We are friends. We are shaking hands with each other,” said Kuwait’s oil minister, Rasheed Salem al-Ameeri. “It is just something which will be resolved.”

Iraq had reportedly massed troops along its disputed border with Kuwait to bolster oil and land claims. But diplomatic sources said Iraq had agreed to pull the troops back.

The ministers of the 13-nation cartel appeared to be in agreement that their target price of $18 a barrel should be raised by at least $2.

“There is a general feeling that we want to have the price at least $20,” Indonesian Oil Minister Ginandjar Kartasasmita said today. Iraq has proposed a target of $25 a barrel.

But any new target price would have little effect on the world markets without a tight rein on production. The current world oil glut is keeping the cartel’s average price down to about $16 a barrel.

Crude oil prices dropped sharply in the spring, a decline blamed mostly on overproduction by Kuwait and the U.A.E.

The average price of crude monitored by the cartel soared to $20.46 a barrel in early January, but plunged to $13.64 less than six months later. It bounced back to $16.25 last week.