LONDON – The president of the Organization of the Petroleum
Exporting Countries said that there was little the group
could do to lower fuel prices anytime soon, because OPEC's
oil production quotas were not the problem.
His remarks contradicted statements made by Saudi Arabian
officials, the cartel's leading producer, calling for
increases in quotas to ease price pressures.
Purnomo Yusgiantoro, cartel president and the energy
minister of Indonesia, said that the recent sharp rise in
retail gas prices and other fuels was "due to factors
beyond OPEC's scope."
Purnomo said that speculation, geopolitics, taxes and other
problems in the United States gasoline market were to blame
for the rampant increase in pump prices in America.
No matter what OPEC decides to do, there is little or no
relief in June, because tankers used to carry crude oil to
market are already booked for the month and no more are
Other oil experts said Purnomo's assessment of OPEC's
ability to affect prices were a mixture of political
posturing and fact.
Purnomo said, "The price today is a high price, and we want
it to be lower.” But it would be very difficult for OPEC to
overcome high prices by itself, he said, because pumping
more crude would not address shortages in refinery capacity
and other problems.
As the political climate in the U.S. heats up prior to the
November elections, fuel prices are becoming a significant
issue, with pressure mounting on the Bush administration to
either tap the strategic petroleum reserve or get OPEC to
produce more oil.
Seven state attorneys general have sent letters to
President Bush, asking him to urge Attorney General John
Ashcroft to join them in investigating whether oil and gas
companies and OPEC are colluding to drive up prices.
The 11 members of OPEC produce about one-third of the
world's oil supply. Iraq is a member, but it has not been
included in quota agreements since it invaded Kuwait in
1990. Policy makers who had hoped that production in Iraq
would revive and help bring down world prices have been
disappointed. Though sanctions on Iraq were lifted after
the United States-led invasion in March, persistent
sabotage has held down the amount of oil the country has
been able to ship.
At the root of the global problem, Purnomo said, is global
demand for oil that is far outrunning forecasts.