06/09/2011, 00.00
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Rise in oil prices after OPEC disagreements

Venezuela and Iran oppose the Saudi Arabian proposal to increase production by 1.5 million barrels per day. Collapse of prices feared. Gaddafi representative attends meeting and ensures the usual annual production.

Hong Kong (AsiaNews / Agencies) - Oil prices rose to over 101 dollars a barrel after OPEC decided not to increase production. Yesterday at a meeting in Vienna that lasted over five hours, six members of OPEC (Organization of Petroleum Exporting countries) refused to accede to the Saudi Arabian proposal to increase production of crude oil. 20 minutes later the price of oil on the New York Stock Exchange rose by 2.7%.

Saudi Arabia (the world's largest producer in OPEC), along with Kuwait, Qatar and UAE had proposed an increase in production by 1.5 million barrels per day. But Iran and Venezuela have rejected for fear of a "collapse" in prices. It is the first time in 20 years that OPEC members have not reached agreement.

In addition to Iran and Venezuela, also Ecuador, Algeria, Angola and Libya have opposed the Saudi proposal. A low oil price is very important to reduce inflation in western countries. But the oil countries are worried about their economies affected by high food prices, which could drop their nations in a situation similar to that of Tunisia and Egypt.

However, Riyadh intends to increase the production of 1.5-2 million barrels by the third quarter, despite the disagreement.

The representative of Gaddafi said his country will honour the contracts already signed. But according to estimates of economic agencies, the conflict in Libya is likely to affect production. Already at least 90% of exports have been cut.

According to some analysts, by the end of the year the price of oil will reach 130 dollars.
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