- The Washington Times - Thursday, September 27, 2001

VIENNA, Austria (AP) OPEC delegates broke off informal talks yesterday without agreeing whether the oil producers' cartel should adjust output, highlighting their dilemma of trying to reverse a dramatic slide in crude prices without worsening the global economic slowdown.
Representatives of the Organization of the Petroleum Exporting Countries delayed a formal meeting on the group's production and pricing policy until today.
"No agreement yet," OPEC President Chakib Khelil told reporters as he left the hotel where the two-hour talks took place.
Libya's oil minister, Ahmed Abdul Karim Ahmed, echoed that message, adding that formal talks would take place "tomorrow" instead of last night as originally scheduled.
However, OPEC delegates were meeting late yesterday with officials from eight non-OPEC oil-producing countries including Mexico, Russia and Angola at OPEC's headquarters in Vienna. An OPEC spokesman told reporters it was possible that the cartel might announce a decision about its production quotas later in the evening.
Indications were strong that the cartel would decide to leave its existing levels of oil production unchanged.
Mr. Khelil said as much on Tuesday. After the end of yesterday's informal talks, Venezuelan Oil Minister Alvaro Silva and Libya's Mr. Ahmed both said OPEC is unlikely to change production levels at this week's meeting.
Although the delay was not a complete surprise, it indicates the difficulty OPEC members face in trying to forge a consensus amid the intense economic and political uncertainty prevailing since the Sept. 11 terror attacks on the United States.
Oil prices have plunged several dollars since the attacks, but OPEC's 11 members are constrained from cutting output to bolster prices because such a step could tip the fragile world economy decisively into recession.
OPEC's room to maneuver is limited further by the reluctance of key members to antagonize the United States, the No. 1 importer of OPEC crude, as it leads a military alliance against Afghanistan's Taliban regime and the forces loyal to Osama bin Laden, the prime suspect in the attacks on New York and Washington.
"OPEC's basic problem is they can't do anything," said Raad Alkadiri, an energy analyst with the Petroleum Finance Co., a Washington-based consultancy.
Some delegates said OPEC may schedule a meeting for November, by which time market conditions might have stabilized somewhat.
OPEC's official output is 23.2 million barrels a day. The group has cut back its official production three times this year already, most recently by 1 million barrels a day on Sept. 1.
But many OPEC members are still producing well above their individual quotas, for a total that analysts estimate ranges from 700,000 to 1.5 million barrels a day. All told, OPEC supplies almost two-fifths of the world's oil.
The group's immediate challenge is to reach a consensus about prices, which, despite an initial spike, have tumbled since the Sept. 11 attacks.
Iranian Oil Minister Bijan Namdar Zangeneh advised OPEC members not to panic about the continuing slide in prices, insisting that it wasn't caused by fundamental market forces of supply and demand.
"This is mainly because of speculation and will disappear very soon," Mr. Zangeneh told reporters earlier yesterday.

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