Leaders from both moderate and militant member nations of the Organization of Petroleum Exporting Countries today affirmed their interest in reaching a compromise on pricing later this week that would bring greater uniformity to the troubled oil market. But Venezuela appeared to be one major stumbling block to an agreement that would fix a single reference price below the current average.
Humberto Calderon-Berti, Venezuela's oil minister, told reporters bluntly that he could not agree to a drop in his country's oil price, now pegged at $36 a barrel (42 U.S. gallons), the existing OPEC benchmark.
He cited both domestic political reasons and the argument that his country always has been an OPEC moderate and so should not have to suffer from problems caused by the organization's more militant members. Moreover, Venezuela is having no problem selling its output of roughly 2 million barrels a day, 60 percent of which goes to the United States, Calderon-Berti said.
Although Venezuela produces about 10 percent of OPEC's total output, the country's tough stance is not expected to be sufficient to prevent some accord by other members who appear inclined to narrow the wide range in prices that now exists between them.
The 13-member OPEC has not had a unified pricing policy since early 1979, and its attempt to resolve the issue in May proved unsuccessful.
The price of OPEC oil ranges from a low of $32 a barrel charged by Saudi Arabia, the dominant producer, to more than $40 a barrel officially asked by the North African producers -- Libya, Algeria and Nigeria -- for their top premium oil.
In one compromise actively under discussion among OPEC governments, Saudi Arabia would raise its price by $2 a barrel to $34, while the North Africans -- who already have been hit hard by a slack in worldwide demand and an oversupply of oil running at more than 2 million barrels a day -- would bring their prices under a ceiling of $37 a barrel.
For the deal to work, countries with higher oil prices are seeking assurances that Saudi Arabia would trim its output. The Saudis have been keeping oil production up in order to create pressure for price reductions. The Saudis, in turn, are asking OPEC members to commit themselves to a longer-term pricing strategy that could insure greater stability and public confidence in the oil market.
Representatives of the special six-member OPEC committee working on a long-term strategy that envisages indexing oil prices to world inflation rates and currency fluctuations met today to review a report for presentation to the full OPEC conference scheduled to begin Wednesday.
The Wednesday session is an extraordinary meeting requested by Nigeria, and although OPEC officials still are describing it as "consultative," it may yet be upgraded to a formal meeting at which a pricing decision can be taken. Sheik Ahmed Zaki Yamani, Saudi Arabian oil minister, reiterated to reporters today that he expects the meeting to succeed in unifying oil prices.
Also signaling flexibility, Abdussalam Mohammed Zagaar, Libya's oil minister, told reporters he is ready to compromise, although he said he had not yet decided about lowering his country's oil price to the $37 mark.
Subroto, Indonesian oil minister and the OPEC chairman, said no official pricing proposal has been presented to organization members. But he confirmed that a narrowed price margin of $34 to $37 a barrel "seems to be a range people are talking about."
In an apparent reference to Saudi Arabia's preconditions, Subroto said "there is some link" between an OPEC commitment to a long-term strategy and eventual agreement on short-term price and production adjustments.
Along with Venezuela's Calderon-Berti, Subroto seemed to rule out the possibility that OPEC would find the unanimity necessary at its upcoming meeting to set a new general benchmark of $34 a barrel.