LONDON, 10 August 2004 — World oil prices soared to fresh record high levels yesterday on heightened worries about supply after major producer Iraq stopped pumping crude in the south.
New York’s light, sweet crude for September delivery surged $1.02 to an historic peak of 44.97 dollars in early afternoon deals as Iraq’s southern oil fields halted pumping.
Brent North Sea crude oil for September rocketed also by $1.02 to a record high of $41.65 during late trading in London.
Traders were keeping a nervous watch also on Venezuela ahead of a referendum there on Sunday which the opposition hopes will unseat controversial President Hugo Chavez.
The latest opinion polls mostly show a majority of Venezuelans would vote for Chavez to serve the remaining two years of his term. The price of the OPEC basket of seven crude oils reached a new record high of $39.67 on Friday as world oil prices kept soaring, the organization said in a statement yesterday.
The basket, which is always published with a one-work day delay, rose Friday by 12 cents from Thursday, when the price hit $39.55, reported OPECNA, the organization’s official news agency.
A spokesman said the level reached Friday was the “highest ever”.
The basket was created in 1982 for Organization of Petroleum Exporting Countries’ internal use and has been published since 1987.
OPEC may raise its production quotas to match current output levels in a measure to prevent further overheating in the oil market, the organization’s President Purnomo Yusgiantoro said in Jakarta yesterday.
Speaking days after crude prices were driven to record highs amid concerns over supply, Yusgiantoro said OPEC was capable of beefing up production because of excess capacity. “The possibility is always open. We have over-capacity, so it can be increased,” he told reporters, adding that the measure would be discussed at the next OPEC meeting in Vienna on Sept. 14.
Yusgiantoro said that although OPEC’s ceiling currently stood at 26 million barrels per day, due to over-production and extra output from Iraq not subjected to the organization’s quotas, it was delivering an extra four million. “Production is already 30 million barrels so it can be increased. This will be discussed in further detail (in September). Yusgiantoro said that the OPEC meeting would also be opened to non-members.
“OPEC will discuss steps to stabilize world oil prices with non-OPEC countries and large oil producers, among them Russia and Angola. “We will discuss world oil price conditions,” he said.