UAE Oil Minister Obeid bin Seif al-Nassiri said Tuesday that 25 dollars a barrel was a "reasonable" price for crude oil, urging producers to cooperate to ensure the stability of the market.
"A fair price for both the producers and consumers must be between 22 and 28 dollars a barrel," Nassiri told Al-Ittihad newspaper.
"That is linked to market conditions but I think that 25 dollars a barrel is a reasonable price," Nassiri said.
"Stability in the market relies on cooperation and coordination between the producing countries to realise their mutual interests," said the minister, whose country is a member of the Organisation of Petroleum Exporting Countries (OPEC).
"OPEC must accommodate several political and economic factors" in facing up to booming oil prices, Nassiri added. "We hope that economic interests will prevail."
"Oil is a strategic commodity that must not become a source of tension between countries," he warned.
According to Nassiri, "producer countries care foremost about their interests in trying to reach a fair price without harming global economic growth."
He also warned against any unilateral production hike, saying that such a move "would lead to a saturation of the market that neither producers nor consumers want."
In London, benchmark Brent crude for October delivery traded Monday at 31.10 dollars a barrel, as analysts predicted a relatively steep price fall unless oil production levels are cut once winter is over in the northern hemisphere.
In New York, light sweet crude for September delivery climbed 77 cents to 32.76 dollars a barrel.
Nassiri added that the oil sector in the United Arab Emirates, whose OPEC production quota is 2.219 million barrels per day, accounted for 40 percent of the country's gross domestic product.
"Revenues generated directly or indirectly from oil are almost 80 percent of budgetary receipts," Nassiri said, urging producer countries to utilise their oil money to diversify their economies and reduce their dependence on oil. – (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)
