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Iraq Returns to OPEC When Oil Cartel Meets Wednesday - 2003-09-23


Iraq will make its post-war return to the Organization for Petroleum Exporting Countries when the organization's oil ministers meet Wednesday in Vienna. The oil producing countries are not expected to change their production quotas.

Despite pressure from the International Energy Agency, OPEC ministers are not expected to increase their oil production quotas from the current levels of 25.4 million barrels a day. OPEC officials say they may review production limits at a special meeting in December.

Iraq, which did not attend the last oil ministers' meeting in July, will be represented by oil minister Ibrahim Bahr al-Uloum, a Shiite cleric.

Although Iraq is a founding member of OPEC, its return to the club was not welcomed by all. Venezuela's minister, Rafael Ramirez, has objected to Iraq's presence at the meeting, arguing the country does not have an internationally recognized government, and should have only observer status.

Negotiations are under way to find an acceptable compromise before the formal meeting begins Wednesday.

Ehsan Ul-Haq, an analyst for PVM oil associates in Vienna, says he thinks Iraq will likely be accepted back in OPEC. "The Arab League has accepted the new interim government in Iraq," said the analyst, "and I think most Middle East countries also have no objection to the new Iraqi interim government and therefore they will accept the government and I think as long as the Arab countries don't object, it will not be a problem."

Mr. Ul-Haq says Iraqi oil production is slowly picking up, and is currently estimated at around 1.5 million barrels per day. That compares with just more than two million barrels on the eve of the war.

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