Robert Priddle News

OPEC has seemingly bowed to U.S. pressure for cheaper oil by agreeing to higher output limits, immediately agreeing to turn up the taps by 1.45 million barrels daily, or seven percent. Iran, OPEC's second largest producer, opted out of the deal, saying it feared a price plunge and complaining about interference from Washington. The action, which has been anticipated given the strong political pressures placed on the OPEC ministers, immediately sent petroleum prices into a tailspin, with Brent futures dropping $1.26 to $24.25 per barrel. OPEC won applause from the Clinton administration, which said there was now no need to release national emergency supplies to ease election year political pressure from consumers irate at high gasoline prices.

The International Energy Agency (IEA) said it would convene immediately to respond if Iraq halts 2.3 million barrels per day (bpd) in exports and warned such a move by Baghdad would rattle oil markets. "I think we would immediately come together to decide what to do," IEA Executive Director Robert Priddle said. He was speaking hours after an Iraqi source told Reuters Baghdad is likely to suspend oil sales worth five percent of world crude exports from November 1 if Washington objects to a plan by Baghdad that it be paid in euros rather than dollars. The head of the West's energy watchdog said a disruption of Iraq's exports would rattle the oil market, which is already locked in a relentless price rally. "Iraq has 2.3 million barrels.

World energy use will grow by a steady two percent a year from now till 2020, and carbon dioxide emissions which contribute to unwanted climate change will rise at about the same rate. Most of the increases will come in developing countries. Oil, gas and coal will continue to dominate the world fuel mix. Countries that import oil and gas will grow increasingly dependent on production from OPEC members in the Middle East. These are some of the main projections to be found in the "reference scenario" of World Energy 2000, the biennial flagship publication of the International Energy Agency. The new Outlook was launched today at the COP 6 Conference in the Dutch capital.

The Paris-based International Energy Agency has welcomed OPEC's decision not to make any further cuts in production. Despite a steep fall in oil prices since the terrorist attacks of September 11, the Organisation of Petroleum Exporting Countries today rejected the option of lowering its target for the seventh time this year. "A further cut would simply have added uncertainty to an already uncertain market," said Robert Priddle, executive director of the IEA. Priddle described the OPEC stance as a display of moderation. He also expressed appreciation of statements by OPEC countries and by the Organization's Secretary General, which have pledged to keep oil flowing to consuming countries in the event of any supply disruption.

At a scheduled meeting today, the Governing Board of the International Energy Agency discussed the current restraints on world oil supply, the significant decline in oil stocks worldwide and the sharp rise in oil prices. They expressed concern that the tightening supply situation could feed inflation and slow economic growth, thereby giving rise to problems particularly for developing countries. “Such instability would be in no one’s interest,” said Robert Priddle, Executive Director of the Agency. The Board noted that industry oil stocks worldwide were lower at the end of last year than at any time in the past decade. Yet demand is constantly growing.