Word: petroleum
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...condition for a price drop. Saudi Arabia continues in its outspoken position as the one producing country whose officials have consistently argued that it is unrealistic for Middle East states to maintain posted prices for oil that are four tunes as high as they were last fall. Richer in petroleum reserves than any other nation, Saudi Arabia announced last month that in early August it would auction off some crude without setting a minimum price. Its plans aroused high hopes, especially in the U.S., that this month would see the beginning of the long-awaited price fall...
...Ford Administration of just how much the U.S. values Arab cooperation. But most oil analysts suggest a different reason: however sincere the Saudis may be in their desire to cut oil prices, they are reluctant to disrupt the powerful cartel formed by the twelve members of the Organization of Petroleum Exporting Countries. King Faisal's government apparently feels that it cannot move unless it gets the support of at least one or two other O.P.E.C. countries...
That it has signally failed to win. In fact, after plans for the Saudi auction were announced, government ministers from other Persian Gulf oil-producing nations hurriedly declared their readiness to cut back petroleum production, if necessary, to keep world prices from dropping. Abdel Rahman Al-Atiqi, Kuwait's Minister of Finance and Oil, warned: "If there is any attempt to undermine oil prices by any party through reducing them in an unnatural way, O.P.E.C. has a specific plan in hand to counter any such attempt. And when I say O.P.E.C., I mean all the member states without exception...
...prices do eventually drop, it probably will not be as a result of the next O.P.E.C. meeting in Vienna in September. At the latest meeting in Ecuador in June, Saudi Arabian Petroleum Minister Ahmed Zaki Yamani pressed for a cut of $2 per bbl. in the posted price of $11.65 per bbl. for light crude. (The posted price is a theoretical figure, but it helps to determine the actual price because it is the number on which taxes and royalties levied against the oil companies are based.) Yamani had all he could do, however, to keep the other O.P.E.C. members...
...British Petroleum...