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Oil supply hike imminent
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October 27, 2000: 12:29 p.m. ET
OPEC vows 2% increase if prices stay above $28 a barrel for one more day
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NEW YORK (CNNfn) - OPEC President Ali Rodriguez said the oil exporting cartel would announce a 2 percent increase in oil supply on Monday night if world prices stay above its target range until then.
Asked by reporters when the increase of 500,000 barrels per day (bpd) would be announced, Reuters quoted Rodriguez as saying: "At midnight on Monday 30 October if prices stay above $28," referring to the upper limit of the cartel's $22-to-$28 per barrel target range.
If it occurs, the hike will be the cartel's fourth this year as it struggles to contain an oil price spike that has fuelled inflation in industrialized countries.
Last month prices reached $37.80 a barrel last month, the highest since the Gulf War 10 years ago.
Light crude oil for December delivery inched down 61 cents to $33.10 in trading Friday. Brent Crude for December delivery lost 63 cents to $31.34.
Large consuming nations such as the United States have repeatedly put pressure on OPEC producers to raise output so fuel prices may ease and limit inflationary pressures.
 But with most OPEC states already pumping at full throttle, the cartel will struggle to deliver fresh supplies ahead of a Northern Hemisphere winter that will see the highest demand in history, analysts said.
Lawrence Eagles, Commodity analyst at London brokerage GNI said that the Saudis are already producing approximately 500,000 barrels per day more than their allotted quota, so making that production official could well have little impact on the amount of oil on the market.
"If it is an actual increase it will depress prices at least in the short-term," said Irene Haas, an oil analyst with Sanders, Morris Harris. But because of the current political situation in the Middle East, Haas said that it was difficult to project the long-term effects of such a move.
Rodriguez, who is also the Venezuelan energy and mines minister, said the order to raise production would be transmitted from the cartel's Vienna headquarters to the 11-member group.
OPEC agreed earlier this year to increase its supply to world markets automatically by 500,000 bpd, or 2 percent, when its reference price exceeds $28 per barrel for 20 consecutive working days.
The OPEC basket stood at $31.14 per barrel on Thursday, having spent 19 days above the trigger level. OPEC's Vienna secretariat publishes its prices with a day's delay. 
-- from staff and wire reports
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OPEC
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