PARIS, 25 August 2004 — The International Energy Agency and the United States yesterday voiced concern about high oil prices, a spokesman for the Paris-based IEA said.

IEA Director Claude Mandil and US Energy Secretary Spencer Abraham, in a meeting in Paris, “expressed their concern about the recent tensions on the oil market,” the spokesman said. The two men did not discuss the issue of using strategic oil reserves to ease price pressure, he said.

According to the spokesman, Mandil said: “There is no apparent reason for the prices to remain at their current level. “The market fundamentals are comfortable, there is more supply than demand and stocks are in the process of being replenished.”

The two men agreed that certain short-term market concerns perhaps had been “overestimated,” for example the crisis at Russian oil giant Yukos or the erratic Iraqi exports, the spokesman said.

They welcomed Saudi Arabia’s recent offer to increase oil production immediately to ease demand pressures.

But the question of using IEA stocks “was not raised,” the spokesman said.

On the subject, he quoted Mandil as saying “of course, no decision” had been taken, noting that was the responsibility of the IEA governing board.

Mandil also noted that “signals coming from the market clearly show more investment is needed” in the oil sector, as well as improvement in energy efficiency and responsible consumption, the spokesman said.

The IEA is the energy forum for 26 industrialized countries and is linked to the Organization for Economic Cooperation and Development.

Meanwhile, oil prices fell yesterday for the third trading day in a row as supply fears receded after Iraq stepped up oil exports through its southern pipelines and Russia vowed to boost supplies.

The price of benchmark Brent North Sea crude oil for delivery in October dropped 13 cents a barrel to $42.90 in late trading in London.

New York’s main contract, light sweet crude for October delivery, fell 25 cents to $45.80 in early deals.

Prices have fallen markedly since the September contract reached an all-time high $49.40 in New York on Friday before expiring. “Venezuela has moved away as an issue. Iraq’s production is rebuilding again despite problems continuing in Najaf,” noted Commerzbank analyst Jon Rigby.

“We are in a relatively quiet period. That’s the reason why the speculative wave that we saw last week has dried to death and prices are drifting off,” he added.