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Chavez pursues goals at OPEC summit |
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September 26, 2000
CARACAS, Venezuela (AP) — In playing host to the first OPEC summit in 25 years, President Hugo Chavez is pursuing goals closest to his heart: staking out a more active role for Venezuela within the oil cartel and attacking inequities between the Third World and industrialized nations. Yet international pressure to lower oil prices and differing agendas among the 11 members of the Organization of Petroleum Exporting Countries could complicate his efforts. Starting Tuesday, ministers will try to reshape the cartel's public role from defender of higher oil prices to a consumer-friendly advocacy group that wants to avoid the wild price swings of recent years. Arriving in Caracas Monday, Algerian Oil Minister Chakib Khelil reiterated that his country supports a $25 per barrel OPEC target — and that if prices stay above $28 a barrel, OPEC likely would increase output at its Nov. 12 meeting in Vienna. Despite three production increases this year, world prices reached $36 a barrel last week — levels not seen since the 1991 Gulf War. Some economists and world leaders have warned that if the steep oil prices continue they could slow the world economy, particularly Asia's strong recovery from the 1997-98 financial crisis. No production increases are expected at the summit. But Saudi Arabia's oil minister, Ali Naimi, said the cartel may act before the Vienna meeting ``if necessary'' as it pursues a price range of $22 to $28 a barrel. Even so, most oil experts believe prices will remain volatile and high for the foreseeable future because of low inventories and the fact that OPEC is producing at near capacity. Viewed as a champion of the poor, the charismatic Chavez has cajoled fellow leaders of developing nations since his first election in 1998 to unite and confront the perils of globalization. The Caracas summit is no exception. ``This reunion isn't only about oil,'' Chavez declared in a national TV broadcast late Monday. While OPEC leaders were determined to achieve a ``fair price'' and ``market equilibrium'' for their product, they also were focusing on global poverty, foreign debts and unfair terms of trade for developing countries in their search ``for a more just world,'' he said. Vice foreign minister Jorge Valero said Chavez wanted ``to open a new dialogue between producers and consumers,'' obtain a balance between ``fair prices and stable prices,'' and create a ``platform'' at the OPEC summit to initiate a dialogue with consumer nations. The Chavez administration has embraced U.S. moves to stabilize oil prices by dipping into its strategic reserves and has stressed its willingness to work with Washington. Venezuelan Oil Minister — and OPEC President — Ali Rodriguez emphasizes Venezuela's proximity to the United States as a ``stable'' U.S. supplier of oil, and he is welcoming U.S. Energy Secretary Bill Richardson to Venezuela after the summit. Yet Chavez insists Venezuela's citizens come first, in a country where gasoline, at less than 50 cents a gallon, is cheaper than water. When oil prices fell to about $10 per barrel in 1998, Venezuela plunged into a devastating recession it is still struggling to escape. Unemployment is officially 15 percent, while some 80 percent of Venezuela's 23 million people live in poverty. Other OPEC producers also see benefits from high prices, but each has its own agenda. Saudi Arabia, the largest OPEC producer by far, is looking to record its highest trade surplus in almost two decades. Its trade surplus is expected to surpass $45 billion this year. For the Saudis, each $1 rise in the price of oil adds another $3.1 billion in revenues at current production levels. But the Saudis, who nearly always have the last say in OPEC because of their huge production quota of more than 8.5 million barrels a day, have been under tremendous pressure from the United States to help stabilize oil prices. Iran, the second-largest OPEC producer, is equally gleeful about the additional $1 billion it earns from each $1 increase in the price of oil. On the Net: http://www.opec.org |