OPEC ministers today endorsed maintaining high crude production to ease any oil shortages caused by the Persian Gulf crisis, and they pledged to sharply reduce their output once it is resolved.
Nigerian Oil Minister Jubril Aminu said the accord, which quickly wrapped up the cartel’s winter meeting that began Wednesday, “should firm (prices) up and send a signal (that people) need to relax in a time of worry.”
The ministers’ action reaffirms an earlier decision to suspend the Organization of Petroleum Exporting Countries’ production quota system and allow its 13 members to produce to their utmost.
Iraq and Libya had opposed the move by the cartel in August to produce excess crude. Iraq’s delegate said he objected to part of today’s accord since his country did not go along with the August decision to cancel quotas.
The suspension in August was designed to help offset shortages caused by Iraq’s Aug. 2 invasion of fellow OPEC member Kuwait.
The countries wanted to make up for the shortfall of about 4 million barrels a day resulting from the U.N.-ordered embargo on trade that has cut the export of Kuwaiti and Iraqi crude.
OPEC President Sadek Boussena said the oil chiefs pledged “to go back immediately” after the crisis to a supply ceiling of 22.5 million barrels a day.
With super-producer Saudi Arabia in the lead, the cartel has boosted production to about 23 million barrels of oil a day.