French Finance Minister Laurent Fabius has proposed that European Union finance ministers discuss releasing oil reserves under the terms of an EU directive, Belgian Finance Minister Didier Reynders said here on Tuesday.The ministers are due to meet on Friday.
Reynders also said that France, which currently holds the EU presidency, has strategic oil reserves which it could release to ease high prices, but this was not the case in Belgium.
"It is rather in France where the reserves exist. In Belgium it is operational reserves in the oil companies, not the government, not public reserves," Reynders told AFP's financial affiliate AFX on the sidelines of an International Monetary Fund (IMF) meeting.
The Belgian minister noted that an IMF communique on Sunday had said there is common agreement between consumers and producer countries on the need for lower and stable long-term oil prices.
"For the first time in an international forum, producers and consumers are in agreement that there should be an increase in production and that consumers can draw on their reserves," he said.
"In common with producers, including Saudi Arabia, Algeria and Venuzuala, the accent is very much that they go further in their production," he said.
Concerning the euro, Reynders said: "What is interesting for Europe is to note that the analysis of the euro being undervalued is shared. Friday's intervention shows that view is shared by others."
The concerted central-bank intervention has stabilised the euro's value, he said, adding that "further intervention is always possible. What is is important is the signal."
European finance ministers have given no guidance to the European Central Bank (ECB) on what level the euro should rise to, he said.
Separately, an EU central bank official said the intervention has sent the message that 85 cents for the euro is too low and that the aim of reversing the euro's fall has been achieved.
He declined to say what would trigger further intervention but noted that ECB interest rates could go up to counter inflationary risks.—AFP.
©--Agence France Presse.
© 2000 Mena Report (www.menareport.com)
