VIENNA (AFP) - OPEC struck back at record oil prices with top producer Saudi Arabia saying it was ready to put 1.5 million more barrels per day (bpd) on the world market.
Saudi Arabia will increase oil production capacity to 11 million barrels per day (bpd), Saudi Oil Minister Ali al-Nuaimi said Tuesday.
The kingdom will use the Abu Safah and Qatif fields, "which are now on stream, to hike its production capacity to 11 million barrels per day by intensifying well drilling in producing fields," he said.
The Arabic version of Nuaimi's statement said that the increase would take place "within the next few weeks".
Nuaimi stressed that Saudi Arabia, the world's top crude exporter, was fully prepared and well equipped to meet the oil requirements of its customers for any additional quantities of oil.
Saudi Arabia "seeks to stabilize the market and curb the escalation of prices that could be detrimental to the growth of the global economy, particularly that of developing countries," Nuaimi said.
The announcement came after oil prices broke above 50 dollars a barrel.
In New York the price of light sweet crude for November delivery climbed to an all-time peak of 50.47 dollars per barrel, the highest level since oil began trading on the New York market in 1983.
Crude oil futures smashed the 50-dollar barrier for the first time in after-hours New York trading on Monday, mainly because of unrest in Saudi Arabia and Nigeria.
In Jakarta, OPEC president Purnomo Yusgiantoro said: "Right now, OPEC cannot do anything (to curb the price rise) and the high oil price can cause a recession."
In London, oil analyst Deborah White at Societe General bank, told AFP: "The Saudi announcement is not a surprise. The only thing that we don't know is when we will actually see the production."
She said that Saudi Arabia had tried to increase production in July but "couldn't deliver...now they say end of September, no problem, but we don't know".
She said: "The Saudis have always said that if the customers want more crude, they can have it. The problem is that the more crude they have is heavy sour, which is more difficult to refine. And there isn't any spare refining capacity available to process it.
"The Saudis are already maximising the production of extra light," she added.
At French magazine "Petrole et gaz arabes", Francis Perrin said: "OPEC can no longer regulate much because its production (of light crude) is already going at full blast."
He added: "If the Saudi supply of oil is disrupted, we will enter a period of shortfalls, a scenario which no one dares to imagine."
Experts say that in fact there is enough oil available to meet world demand, with OPEC supplying 35 percent of global supply.
But OPEC's extra capacity is stretched as thin as it has ever been.
According to industry watchers, OPEC's excess oil capacity was down to 0.5 to 1.2 million bpd in July, against seven million bpd at the beginning of 2002.
But Yusgiantoro said OPEC had excess capacity of 1.5 million bpd and that this would last until the end of the year.
The London-based Centre for Global Energy Studies (CGES) said however that oil prices are out of OPEC's control owing to galloping world demand, especially from China's booming economy.
The International Energy Agency (IAE) has said that world demand should rise by 3.2 percent in 2004, to 81.4 million bpd, with demand estimated at 83.2 million bpd next year.
Chinese oil imports jumped 30 percent last year, and the IAE estimates that China will need to import 11 million bpd in 2025 against 5.5 million bpd now.
This leaves OPEC will "little room to maneuver," IAE president Claude Mandil said recently.