- The Washington Times - Monday, September 23, 2002

OSAKA, Japan (AP) The European Union yesterday rejected accusations by OPEC producers that U.S. talk of war in Iraq was driving oil prices higher.
With prices near 19-month highs of $30 a barrel, the United States and other industrialized countries say hopes for a global economic recovery could be undercut if oil producers don't pump more crude and temper prices.
Ensuring access to oil was a main theme at the International Energy Forum, which brought together officials from 70 countries. The forum wraps up today in Japan's western industrial city of Osaka.
Many OPEC states blame high prices on Washington's talk of toppling Iraqi President Saddam Hussein. They point to analyst estimates of a "war premium" that has increased prices by $2 to $4 a barrel.
"This increment is attributed to the one who is provoking conflict, not to us," said Alvaro Silva Calderon, secretary-general of the Organization of the Petroleum Exporting Countries.
EU Energy Commissioner Loyola de Palacio said: "To blame the Americans over the price of the oil is very simple, but this is not the reality. I don't agree that it is the fault of the Americans."
The commissioner described talks at the energy meeting as "frank" and said the big issue was the gap between buyers and sellers about where prices should be.
U.S. Energy Secretary Spencer Abraham met privately with Saudi Arabia's oil minister, Ali Naimi, yesterday, but neither side would say afterward what had been discussed between the world's largest oil consumer and the largest exporter.
OPEC last week rejected importers' demands for more oil and left official output unchanged at 21.7 million barrels a day.
Mr. Silva said yesterday that OPEC would try to boost oil supply if the United States attacks Iraq, but, "We just don't know what will happen in the case of a war."
The three-day energy forum was intended to bring consumers and producers together for talks on promoting stable markets. But so far, it has underscored differences that will not be narrowed easily.
Oil prices plunged more than 4 percent on Tuesday when Iraq said it would allow weapons inspectors back into the country. But crude has been ticking upward into the $29 range since, as President Bush said he would ask Congress to approve use of military force to oust Saddam.
"The United States is certainly banging the war drums loudly right now," said Raad Alkadiri, an oil analyst with the Washington-based Petroleum Finance Co. "That rhetoric on Iraq is certainly causing nervousness in the market."
Worries about energy security came into focus yesterday when ministers from the 10-member Association of Southeast Asian Nations and counterparts from Japan, South Korea and China held their first talks on establishing emergency oil stockpiles.


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