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OPEC States Meet in Vienna, White House Watches CarefullyAired March 27, 2000 - 1:01 p.m. ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU WATERS, CNN ANCHOR: The OPEC oil-exporting nations are meeting in Europe, trying to make a critical decision: How much to open the taps? The answer should help drive down the high cost of gasoline here at home, eventually.
Right now, the latest survey shows the national average for a gallon of regular, self-serve gas stands at $1.55. That's up half-a- cent from two weeks ago.
Meantime, the oil ministers are struggling to reach a consensus.
With the very latest on that, we go to CNN's Brent Sadler. He's in Vienna, Austria, keeping track of what's going on at the OPEC meeting today -- Brent.
BRENT SADLER, CNN CORRESPONDENT: Thanks, Lou.
Well, OPEC members states, 11 nations, are very much back in the driving seat, as far as gas prices are concerned for U.S. consumers.
Now, the official, first opening session of this 109th OPEC conference got under way within the last few minutes. And right now, the Catari (ph) oil minister has been making opening statements to the 11-member states, as well as four observer-nations, taking part in this critical meeting.
Now, in advance of the formal opening session, oil ministers were locked in talks, trying to thrash out a policy for setting quotas for this upcoming year.
And so far, before going into this first opening session, we understand that they have not been able to make an agreement.
However, the Saudi Arabians have been trying to respond to U.S.'s sustained pressure to trying to bring a consensus about a booth in oil production of at least one million barrels per day. And now, that's just one figure that's being continually coming out unofficially in advance of the opening session of these talks.
But the United States wanted significantly more, at least double that. So if it's only a million, that is going to be a disappointment as far as the U.S. is concerned.
Now, even when and if the OPEC members make significant increases to their projection quotas, it's going to be some time, say industry analyst, before those increased production rates would have an impact on gas prices at the pump. And some analysts say that it could be the fall before you see any motorists seeing serious drops in pump prices for their gas.
Back to you, Lou.
WATERS: Brent, is the object here to find a way to stabilize these oil prices, because as we understand it, the OPEC ministers themselves don't understand how oil prices jumped from $11 a barrel to $34 a barrel in 15 months?
SADLER: That's right, Lou.
Tripled in some 15 months, the price of crude, it has reached $34 a barrel from those very low depths as you say, $11. Now, it's come back below the 30 mark.
But it's in the interest, according to many, of the OPEC member nations, to stabilize oil prices to something between $20 and $25 a barrel. It's not, they say, in their interest to have booming bust cycles within the oil sector.
So, they're trying to fine tune what is good for them and what is good for the market. And it may well be that, even if they do come out with a significant increase in output quotas, they may well set up some sort of a reviewing procedure to keep an eye at for the rest of year -- Lou.
WATERS: All right, Brent Sadler, keeping watch in Vienna, Austria.
We will certainly keep you posted on what happens at the OPEC meeting there -- Natalie.
NATALIE ALLEN, CNN ANCHOR: Well, the Clinton administration has been pressing the oil-exporting nations to raise production to about two-and-a-half million barrels a day. The hope is to cut crude oil prices to about $25 a barrel, eventually reducing gasoline prices at the pump.
With the latest reaction from the White House on the oil ministers' meeting, here's CNN's Carl Rochelle -- Carl.
CARL ROCHELLE, CNN CORRESPONDENT: Natalie, the White House is watching this meeting very carefully, about as closely and carefully as they watch anything, because the administration would like to see the amount of oil increase.
Now, the advanced word is that the OPEC ministers might add back in a million barrels a day, along with cheating, that would put back about two million barrels of the 5.2-million-barrel-a-day production cut that they substituted in 1988 -- or, I'm sorry, in 1998.
What is "cheating"? "Cheating" is simply when a country exceeds the limits that were set for them by OPEC. And some countries do cheat a bit. And that actually puts a bit more oil on the market than might have been anticipated.
The short fall in oil drove the per-barrel prices up above $30-a- barrel. But it did drop back some by the end of last week to around $28 a barrel.
But those high prices for the barrels are what translate into the high prices for fuel oil for heating your home and the high prices, that the gas pump in some areas almost doubled what it was back in 1998.
The Clinton administration sent Energy Secretary Bill Richardson on a round robin to the oil-producing countries, trying to induce them imply, impose, whatever it took to get them to put more oil on the market. The success of those particular ventures by Energy Secretary Richardson may become evident in this OPEC meeting.
OPEC doesn't seem inclined to put more oil on the market. If it does, it could help bring the prices down -- Natalie.
ALLEN: All right, Carl Rochelle at the White House.
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