Iraq accused Saudi Arabia Friday of having already increased its oil output by half a million barrels a day, only two days after the kingdom called for higher production to balance supply and demand.
"Saudi Arabia has unscrupulously returned to the attack and begun playing the same shifty and dangerous role just ahead of the Caracas (OPEC) summit by increasing its output by 500,000 bpd and inviting cartel members to do the same," the official Ath-Thawra newspaper said.
Oil industry sources in London said in July that Saudi Arabia had already increased its crude production by 250,000 barrels barrels per day (bpd) and was planning to boost production again August 1.
The Saudi Supreme Petroleum Council said Wednesday Oil Minister Ali al-Nuaimi had been instructed "to have talks with OPEC countries toward a suitable increase (in output) to guarantee once again the balance on the market and stability of prices."
Prices are at their highest levels since the 1991 Gulf War at more than 30 dollars a barrel, said Saudi Arabia, the world's largest oil producer.
Naji Abi Aad, an oil expert at the Observatoire Mediterraneen de l'Energie in France, said Saudi Arabia and other members of the Organization of Petroleum Exporting Countries "are beginning to realize that the rise in prices will bring about in the long term a drop in demand and will encourage production in more costly regions outside OPEC."
But Ath-Thawra, the newspaper of Iraq's ruling Baath Party, said "Saudi Arabia is plotting against its own interests and against the cartel, of which it is a member."
"Has Saudi Arabia still not understood it is subject to the US administration and its odious capitalism," the paper said.
"It's not in the interest of OPEC countries to increase their production, because such a decision would result in lowering prices while US products remain at the same price level."
"The United States is manipulating Saudi Arabia to deal a blow to OPEC and pressure its members," the paper added.
Iraq is also an OPEC member, but its oil sales are limited by the UN embargo against it. Iraq blames the United States, as well as Britain, for their insistence on keeping the embargo in place. - (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)
