Saudi Arabia is ready to increase oil production
Saudi Arabia said it was prepared to increase its oil production to make up for supply losses caused by Hurricane
Katrina, and to keep in check oil prices.
"Saudi Arabia is ready to increase its production to compensate for any lowering in supplies of crude on the
international oil market," said Oil Minister Ali Al Naimi.
Hurricane Katrina, has force the shut down of eight refineries in the US Gulf coast with a refining capacity of more
than 2 mm bpd and disrupted all oil and gas production in the Gulf of Mexico, or 25 % of total domestic oil and gas
production.
Some analysts are now betting for an $ 80 a barrel, that could severely dent consumer demand and curb business
activities, according to analysts.
US crude oil futures jumped nearly $ 5 in electronic trade to touch a peak of $ 70.80 per barrel, the highest
front-month price since the New York Mercantile Exchange began trading the contracts in 1983. At the close of the
trading day in New York, oil settled down at $ 67.20 a barrel, only $ 1.07 gain since the closing, after the US
government said it could release strategic crude reserves in response to the hurricane.
In Vienna, OPEC could discuss raising production quotas in order to fight record-high prices for crude when it meets
in September in Vienna, a spokesman said.
