Nation & World

<< Previous   of   Next >>   ADVERTISEMENT   Oil prices Crude oil futures were down 54 cents at $134.32 a barrel in electronic trading on the New York Mercantile Exchange late Sunday. Crude prices have reached record highs, surpassing $139 per barrel on June 6 after surging nearly $11 in the biggest single-day price leap ever. Associated Press   Related Stories • This just in from the Department of the Obvious 6/16/08   CONTACT THE HERALD Do you have a news tip? newstips@heraldnet.com | 425.339.3400   Published: Monday, June 16, 2008 Saudis plan to boost oil production Associated Press RIYADH, Saudi Arabia -- Saudi Arabia plans to increase its oil production by 200,000 barrels a day next month, the kingdom's oil minister told U.N. chief Ban Ki-moon on Sunday, according to Ban's spokesman. The country's king thinks oil prices are "abnormally high," Ban said. The U.N. secretary-general met with Oil Minister Ali al-Naimi in the port city of Jiddah during a one-day trip to the world's largest oil producer. Farhan Haq, a spokesman who is traveling with Ban, said in an e-mail that the U.N. chief said al-Naimi told him Saudi Arabia would increase oil production by 200,000 barrels a day from June to July. In May, the kingdom increased its production by 300,000. By July, production should be at 9.7 million barrels a day, Haq said. Ban also said Saudi Arabia understands that the current price of oil, which topped $139 per barrel earlier this month, is not normal, according to the official Saudi Press Agency. "The king believes that the current oil prices are abnormally high, and he is ready to restore prices to their appropriate levels," the news agency quoted Ban as telling reporters in Jiddah. Saudi Arabia is concerned that sustained high oil prices will eventually slacken the world's appetite for oil, affecting the kingdom in the long run. The 200,000-barrel-a-day boost is not insignificant -- it will raise Saudi Arabia's daily production by about 2 percent. But to a market that has been sending oil prices soaring to record heights due in part to strong global demand, the move might be seen as marginal. The oil market largely ignored Saudi Arabia's 300,000-barrel-a-day output increase last month. The kingdom has called for a meeting of oil producing and consuming countries Sunday in Jiddah to discuss ways of dealing with soaring energy prices. The New York Times reported Saturday, citing unnamed analysts and oil traders briefed by Saudi officials, that a production increase of about 500,000 barrels per day was to be announced following the meeting. Saudi Arabia, the world's largest oil producer, is concerned that sustained high oil prices will eventually slacken the world's appetite for oil, affecting the kingdom in the long run. The current president of the Organization of Petroleum Exporting Countries, Chakib Khelil, has said that the cartel will make no new decision on production levels until its Sept. 9 meeting in Vienna. OPEC ministers often follow the lead of the Saudis when discussing whether to increase production to take the pressure off rising prices.

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