Vienna, March 11 (Reuters): The Opec oil cartel sought on Tuesday to reassure anxious world energy markets that it is ready to prevent shortages in any war on Iraq.
Yet the group that controls 60 per cent of world crude exports dashed hopes among importing nations that it might adopt a contingency plan to set aside output limits in the event of war.
Iran and others opposed a policy that implied support for a US attack against an Opec member country. Ministers instead agreed to leave output limits at 24.5 million barrels a day, Algerian oil minister Chakib Khelil said.
Leading cartel power Saudi Arabia said it had “plenty” of spare capacity to maintain adequate supplies should a US invasion snuff out Iraqi exports. “There will be no shortage of oil,” Saudi oil minister Ali al-Naimi told reporters.“The test is, when the need is there, whether we will use the capacity or not and I can assure you we will.”
Oil dealers appeared to draw comfort from Naimi's comments, US light crude eased five cents to $ 37.22 a barrel.
“It doesn't really matter what Opec decided officially,” said Gary Ross of New York consultancy PIRA Energy. “Saudi Arabia has made its policy clear.”
“Opec is adding production already. They are in effect going to manage the market without respect to quotas,” said George Beranek of Washington's Petroleum Finance Company.
Opec is expected to ratify its deal and pledge in a communique to fill supply gaps in the event of a disruption.