CAIRO, Dec 20: Arab oil states, including Saudi Arabia, warned here on Friday against panic in the markets amid jitters over a possible war against Iraq and unrest in Venezuela.

Saudi Oil Minister Ali al-Nuaimi pledged for the second time in eight days that if shortages occurred in supplies they would be made up by the Organisation of Petroleum Exporting Countries (Opec).

“We want to have no imbalances in the market,” he told reporters ahead of a meeting of Arab oil ministers on Saturday. “We want equilibrium between supply and demand, we want a stable oil market, we want a fair price.”

Nuaimi stressed that this was the position of Saudi Arabia, the world’s largest producer, and Opec, which last week announced it would cut output in line with a new ceiling for its members of 23 million barrels per day.

“We have said, both Opec and Saudi Arabia, shortages when determined will be made up,” he said.

“There should be no excitement, there should be no reason to panic, the supply is there. We are watching the market carefully.”

His Qatari counterpart Abdullah bin Hamad Al-Attiyah said, “There is no shortage so far, but if there is a shortage, for sure, Opec always interfered to balance between demand and supply.”

“We should not panic”, he answered when asked about the threats to Iraq and a continuing strike by oil workers in Venezuela.

In contrast, Algerian minister Chakib Khalil warned, “Opec’s capacities will not enable it to match a drop in the oil production of the Gulf region if that is interrupted because of an American strike against Iraq.”

“Opec could handle a drop in Iraqi production, which currently stands at two million barrels a day, but if the production of other countries of the region is affected, it could not do so,” he said.

But an Opec source at the cartel’s Vienna headquarters insisted, “We stand by our position that Opec is ready and willing to compensate for any shortfall. That has been our position and it will never change.”

The source refused to comment on Khalil’s statement itself, saying he had not seen it.

Khalil said there was a ceiling which Opec could not exceed, referring to the new production quota, but in a reference to the Venezuelan crisis, he said the cartel should “take an appropriate decision to bring prices down to between 22 and 28 dollars a barrel.”

Al-Attiyah also said, “If there is a necessity, we may discuss again, but the decision is to be implemented.”

He noted that “When we took this decision, the Venezuela problem was there.

I think there is no shortage at the moment.”

The ministers were speaking ahead of a meeting of the Organisation of Arab Petroleum Exporting Countries (OAPEC), which comprises seven of the 11 members of Opec (Algeria, Iraq, Kuwait, Libya, Qatar, Saudi Arabia and the United Arab Emirates), along with Bahrain, Egypt and Syria.—AFP