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OPEC to cover war oil shortfall
VIENNA, Austria (CNN) -- OPEC members have agreed to raise oil output should supplies be disrupted due to war in Iraq. But the 10-nation Organization of Petroleum Exporting Countries refused to raise output immediately, saying only they would keep on top of market conditions and meet again in June. OPEC president Abdullah bin Hamad Al-Attiyah, confirmed that it was not changing its output target of 24.5 million barrels a day after a meeting at their headquarters in Vienna, Austria. CNN correspondent Charles Hodson, in Vienna, said OPEC, while giving assurances that it would cover any future shortfall, also wanted to avoid a situation where the markets were oversupplied. He added that Saudi Arabia was key to OPEC plans as most of its member nations were at or close to their maximum production levels. Saudi Arabian Oil Minister Ali Naimi told reporters: "There is no shortage of supply, the market is in balance and there is plenty of oil. "There is a commitment to do our best within our capabilities which we think are enough to satisfy any possible shortage in the market for whatever reason." The world market requires 77 million barrels a day and fears of a war and loss of Baghdad's oil supplies could push the price of oil to crippling levels. NYMEX-traded U.S. crude has been trading at $37.40 barrels. Prices remain not far from a record $41-a-barrel set during the 1990 - 1991 Gulf crisis. Al-Naimi said fears over war was to blame for the sharp rise in oil prices, not a shortage of supply. OPEC member Iran had said it will oppose any move to formally suspend output limits. The 10-nations, excluding Iraq, pump 24.5 million barrels a day. Iran said Monday it would oppose any bid by Western-friendly OPEC states to impose a policy that Tehran says implies support for a U.S. attack against Baghdad, by controlling fuel costs.
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