The oil ministers from Saudi Arabia, Venezuela and Mexico were expected to meet in Riyadh in early March to discuss possible output cuts ahead of OPEC’s next meeting on March 16th, according to cartel sources on February 28th.
Saudi Arabia had reportedly suggested the talks, which will likely take place between March 10th-12th, to reach a consensus ahead of the upcoming meeting.
Contradictory statements made by OPEC Secretary General Ali Rodriguez in recent days have left oil markets confused as to what action the group will take.
Rodriguez said on February 26th that OPEC may not cut its output again when the group meets in March if the price of OPEC’s basket of crudes remains at current levels.
That contradicted statements he made the week before that there was near “consensus” for the group to cut its overall production at the March meeting and that a 1 million b/d reduction was not out of the question.
Rodriguez, defending his change of tune, said on February 26th that: “If the price remains stable there shouldn’t be a cut, but it all depends on the forecasts for the rest of the year and particularly for the second quarter.”
Following Rodriguez’s statements, the OPEC price basket dipped to five-week lows of $23.99 a barrel.
Mexican Oil Minister Ernesto Martens said on February 28th that market fundamentals suggest a good balance between supply and demand. Martens said that: “Consequently, we think that an adjustment is not currently required.”
The Mexican oil minister also indicated that he was unaware of any meeting planned between him and his Saudi and Venezuelan counterparts in March.
© 2001 Mena Report (www.menareport.com)
