Political and economic pressures are building across the Persian Gulf for a significant reduction this year in the amount of oil produced for sale to the United States and Western Europe.
As part of this campaign, Kuwait today cut its oil production 25 percent and imposed further restrictions on the amount of oil it will sell to major Western oil companies.
In a related move, Iran, whose production also has diminished, raised the price of its oil $2 a barrel today, bringing its average price to $35 a barrel.
Kuwait, which had been producing 2 million barrels a day, will now produce only 1.5 million, implementing a decision announced earlier.
The Kuwait Oil Ministry also said sales to Gulf Oil, Royal Dutch-Shell and British Petroleum, which amounted to 1.3 million of the 2 million barrels produced, will be reduced to 325,000 barrels a day. Associated Press reported from Kuwait that government sources there indicated the difference of 475,000 barrels a day would be sold directly to governments and to new customers.
The drop in pumping levels forecast for this spring and summer is likely to result in continued momentum for higher scheduled prices within the Organization of Petroleum Exporting Countries (OPEC), despite slack in the current spot market due to plentiful supplies and the approach of warm summer weather, oil analysts in Beirut say.
Saudi Arabia's oil minister, Sheik Ahmed Zaki Yamani, recently estimated world oil stock at 5 billion barrels, which he said was a new high and enough to last the world three months at current consumption rates, even if all producers were to stop pumping.
Saudi Arabia, the world's biggest oil exporter, announced last week that it will continue pumping 9.5 million barrels a day -- a million barrels over its customary ceiling -- through June.
But Yamani warned that this level cannot continue indefinitely. An Arab source recently in Riyadh said Yamani's top aides are predicting a reduction by fall.
"They will do it for sure," said an Arab oil specialist. "The only question is when."
The Saudi royal family raised its production ceiling last year by a million barrels a day chiefly as a favor to President Carter, who appealed for more oil at a time when world supplies were particularly tight. Since then, it has reviewed the decision quarterly and maintained the higher output.
U.S. efforts to keep Saudi and other production high to permit resumption of purchases for stockpiling oil in strategic reserves -- a policy opposed by Persian Gulf oil nations in principle -- have encountered a chilly reaction. Such purchases are expected to become increasingly difficult as Persian Gulf production slides back.
The trend toward cutbacks grows from an unusual coincidence of internal political, diplomatic and economic developments in the Gulf region, most of which point toward slower production rates, analysts in beirut say.
A sharp drop in spot market prices since last fall has convinced Persian Gulf oil-producing nations that a surplus may be building that would threaten the record prices they are getting for their crude, a Gulf diplomat in Beirut said.
In addition, the Arab diplomat said Carter's recent disavowal of a U.S. vote against Israel in the Security Council has created a climate in which Gulf leaders, particularly the Saudis, find it more difficult to defend high oil production as an incentive for American diplomatic pressure on Israel for concession in the Palestinian autonomy talks.
"The Saudis always are telling the other Arabs to let the Americans do it," he added. "But now what can they say?"
Against this backdrop the argument that oil becomes an increasingly precious resource the longer it is left in the ground has become more appealing in Saudi Arabia, Kuwait and the United Arab Emirates, he said. The Iraqi leadership of President Saddam Hussein has long restricted its production on this basis, claiming that, "when the last barrel of oil in the world is pumped, it will be iraqi."
The new Libyan oil minister, Abdessalam Zagaar, recently criticized Saudi Arabia for its high production, which he said trades a valuable resource for dollars that are only deposited in banks and eaten away by inflation. Libya is studying a cutback of its 2.1 million barrels-a-day production, he added.
Oil analysts in Beirut point out that these arguments have all been made before but appear to have come together recently with high supplies and an uneasy diplomatic atmosphere to produce the increased pressure for cutbacks.
Carter's announcement last week that he will impose a $4.62 a barrel tax on imported oil also adds irritation, they say, because Persian Gulf countries traditionally have opposed attempts by foreign governments to reap financial benefits from sale of their oil.
Overall, OPEC production, estimated at about 31 million barrels a day in 1979, is expected to drop by up to 2 million barrels a day this year.
In addition to Kuwait, the United Arab emirates, which produces about 1.8 million barrels a day, also has warned of cutbacks this spring, without publicly specifying how much.
In Iran the turmoil of revolution and lack of parts and proper maintenance for pumping equipment have pushed down production as much as half a million barrels below the official estimate of 2.7 million a day, according to reports from Tehran.
The decisions on production levels are made individually by each country, analysts here say. But, except for Iran, they reflect similar assessment of market conditions.
Yamani's recent declaration that Saudi Arabia will not maintain current levels for U.S. reserve purchases, for example, has been interpreted as part of region-wide resistance to Western desires to acquire a cushion against dependence of Persian Gulf oil with its rising prices.
His statement came during a visit to Saudi Arabia by U.S. Energy Secretary Charles Duncan for discussions concerning U.S. hopes to resume buying oil for the strategic reserves.
The Carter administration has become increasingly eager to increase the reserves -- standing at 92 million barrels -- since the Iranian and Afghanistan crises raised fears about possible interruption supplies from the Persian Gulf. About one-third of U.S. oil imports and even more of Western Europe's come from the region.