Qatari minister: OPEC to discuss price band hike

PARIS (AP) - Ministers from the Organization of Petroleum Exporting Countries are likely to discuss a possible increase in their targeted prices for crude when they meet next in June, Qatar's oil minister said Thursday.

Calls from within OPEC for higher price targets have provoked consternation among industrialized countries and a warning from the Paris-based International Energy Agency that such a move would hurt the global economy.

Speaking to an industry conference in Paris, Qatari Oil Minister Abdullah bin Hamed al-Attiyah acknowledged there were suggestions to raise OPEC's targeted prices from their current US$22-US$28 range, but he declined to say whether Qatar favored an increase.

Al-Attiyah said he was not yet aware of any formal proposal to increase the targets at OPEC's June 3 ministerial meeting in Beirut, but he added that oil ministers were likely to discuss the idea.

"We will have a chance to see what's going on and see how this suggestion would be implemented," the minister said.

"It's still not very clear to me - and I'm a member of OPEC," he added. Al-Attiyah served as OPEC's president in 2003.

Under OPEC's so-called price band mechanism, members are supposed to cut output if oil prices dip below US$22 a barrel for 10 consecutive trading days.

They have pledged to boost production if prices exceed US$28 a barrel for 20 consecutive trading days.

In reality, OPEC members have ignored the mechanism whenever it suits them. OPEC has so far held back from increasing supply even though prices have remained consistently above the targeted range since Dec. 5.

The group's benchmark price for oil, based on a "basket" - or blend - of seven crudes, averaged US$33.67 (28.45) a barrel Wednesday, the most recent day for which OPEC compiled information.

Earlier this week, OPEC president Purnomo Yusgiantoro said the group would study whether to increase its targeted price band to compensate for inflation and a weaker dollar.

Oil is bought and sold in dollars, and some OPEC members have complained that the dollar's recent weakness is squeezing their main source of income.

The comments echoed suggestions by OPEC member Venezuela for an upward revision to the price band, which OPEC set at its current levels in mid-2000.

But Saudi Arabia, the most powerful of OPEC's 11 members, has so far rejected any change.

"We are committed to a price of US$25 for the OPEC basket or a US$22 to US$28 band for the OPEC basket," Oil Minister Ali Naimi said Monday in New York, where he was taking part in a Foreign Policy Association panel discussion on U.S.-Saudi relations. - AP

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