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Chavez warning opens Opec summit | Chavez warning opens Opec summit |
(about 12 hours later) | |
Venezuelan President Hugo Chavez has warned oil prices could double if the US attacks Iran. | |
Opening the summit of the Organisation of Petroleum Exporting Countries (Opec), he said said the price of crude could reach $150 or even $200 a barrel. | |
Oil has been hitting record peaks of well over $90 a barrel as markets believe Opec will not boost production. | Oil has been hitting record peaks of well over $90 a barrel as markets believe Opec will not boost production. |
The Opec summit in Saudi Arabia is only the organisation's third in 47 years. | The Opec summit in Saudi Arabia is only the organisation's third in 47 years. |
Saudi moderation | Saudi moderation |
Mr Chavez kicked off the summit with a blistering attack on the US. | Mr Chavez kicked off the summit with a blistering attack on the US. |
"If the United States was mad enough to attack Iran or aggress Venezuela again the price of a barrel of oil could reach $150 or even $200," he said. | "If the United States was mad enough to attack Iran or aggress Venezuela again the price of a barrel of oil could reach $150 or even $200," he said. |
Oil shouldn't be a tool for conflict, it should be a tool for development Saudi King Abdullah | Oil shouldn't be a tool for conflict, it should be a tool for development Saudi King Abdullah |
Mr Chavez called for unity in Opec ranks, invoking geopolitical reasons. | Mr Chavez called for unity in Opec ranks, invoking geopolitical reasons. |
"The basis of all aggression is oil. It is the underlying reason," Mr Chavez said, referring to the war in Iraq and US threats against Iran over its nuclear programme. | "The basis of all aggression is oil. It is the underlying reason," Mr Chavez said, referring to the war in Iraq and US threats against Iran over its nuclear programme. |
"Today, Opec stands strong. It is stronger than it has ever been in the past. Opec should set itself up as an active geopolitical agent." | "Today, Opec stands strong. It is stronger than it has ever been in the past. Opec should set itself up as an active geopolitical agent." |
But Mr Chavez's remarks were counterbalanced by King Abdullah, the head of state of the host nation, Saudi Arabia, the largest oil producer in the world and a US ally. | But Mr Chavez's remarks were counterbalanced by King Abdullah, the head of state of the host nation, Saudi Arabia, the largest oil producer in the world and a US ally. |
"Those who want Opec to take advantage of its position are forgetting that Opec has always acted moderately and wisely," he said. | "Those who want Opec to take advantage of its position are forgetting that Opec has always acted moderately and wisely," he said. |
"Oil shouldn't be a tool for conflict, it should be a tool for development." | "Oil shouldn't be a tool for conflict, it should be a tool for development." |
Dollar worries | Dollar worries |
Officials from Opec member countries have already said that the summit will not be taking any decisions on oil production levels, prompting an increase in prices on Friday. | Officials from Opec member countries have already said that the summit will not be taking any decisions on oil production levels, prompting an increase in prices on Friday. |
Oil reached a record high of $98.62 a barrel earlier this month | Oil reached a record high of $98.62 a barrel earlier this month |
They say it will be for energy ministers meeting next month to decide whether to increase supplies to the world oil market in response to the current crisis. | They say it will be for energy ministers meeting next month to decide whether to increase supplies to the world oil market in response to the current crisis. |
A division emerged ahead of the summit between Saudi Arabia and Iran, BBC economics correspondent Andrew Walker says. | A division emerged ahead of the summit between Saudi Arabia and Iran, BBC economics correspondent Andrew Walker says. |
Iranian officials wanted the final communique to express concern about the weakness of the dollar, our correspondent says. | Iranian officials wanted the final communique to express concern about the weakness of the dollar, our correspondent says. |
It is an issue because oil is priced in the US currency although as far as Opec is concerned the dollar's decline has been offset by the rising price of crude oil, he adds. | It is an issue because oil is priced in the US currency although as far as Opec is concerned the dollar's decline has been offset by the rising price of crude oil, he adds. |
Saudi officials were against including any such remarks. One is reported to have warned that it could add to the pressure on the dollar. | Saudi officials were against including any such remarks. One is reported to have warned that it could add to the pressure on the dollar. |
Along with the dollar value, geopolitical tensions and concern about tight supplies have been the forces driving oil higher. | Along with the dollar value, geopolitical tensions and concern about tight supplies have been the forces driving oil higher. |
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