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Kuwait Calls for Talks on Offset to Iraqi Half of Oil Supplies
Kuwaiti First Deputy Prime Minister and Foreign Minister Sheikh Sabah Al-Ahmad Al-Sabah underlined Sunday, December 3, the importance of maintaining the stability of the world oil market through consultation and coordination among major oil producing countries.
Sheikh Sabah was responding to questions by the official Kuwait News Agency and Kuwait TV over Iraq's halt of oil exports and the consideration by Saudi Arabia to raise oil output to cover up the shortage cause by Iraq's freeze of supplies.
Iraq suspended shipments of its crude oil on Friday after it failed to reach an agreement with the United Nations on a new pricing scheme for its oil to be sold under the UN oil-for-food program.
Iraq sells about 2.3 million barrels of oil per day, with all the oil revenues going into a UN-controlled bank account. But Iraq has proposed its crude be sold below the price on the world market and a 50-cent surcharge per barrel be deposited into an Iraq-controlled bank account.
The UN sanctions committee has said the Iraqi pricing formula was too low to reflect a fair market value and asked Baghdad to submit a new one. But Iraq turned off the tap.
On the Iraqi move, Sheikh Sabah said "this is its policy and we do not interfere in that," adding Kuwait has been paying attention to the possible influence on world oil stocks.
The Kuwaiti official underlined the need for consultation among members of the Organization of Petroleum Exporting Countries (OPEC) on making up for the shortage.
On Saturday, Saudi Minister of Petroleum and Mineral Resources Ali Al-Naimi, whose country is the world's biggest oil producer and exporter, said Riyadh and other OPEC members could raise production to make up for Iraq's halt of exports.
"Saudi Arabia is consulting with OPEC members and the International Energy Agency as the representative of consumer countries to evaluate the current situation on the market," Naimi said.
"In case of a cut in supplies, these consultations will lead to a practical position that guarantees market stability and remedies any anomaly," he said.
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