Venezuela's Rodriguez says OPEC may set $40-50/bbl price band

London (Platts)--24Jun2005

OPEC could return to a system of aiming to keep crude prices within a target
band and may adopt a range of $40 to $50/bbl, Venezuela's foreign minister Ali
Rodriguez said Thursday, Venezuelan daily El Universal reported. OPEC
ministers agreed at their June 15 meeting to use a new crude basket for
11-OPEC crudes which works out at between one and two dollars lower than the
old seven-crude basket which it replaced June 16. The producer group this year
suspended a goal of keeping a band of between $22 and $28/bbl, which prices
had exceeded for more than a year. "(OPEC) could return to its price band
system, but in a range of $40-$50, in line with the new market reality,"
Rodriguez said, according to an English-language report on the paper's
website. Rodriguez was involved in setting the group's $22-$28/bbl price band
in 2000 when he was the oil minister for Venezuela and OPEC's president. The
price band had been useful "for gaining stability and preventing high
volatility that creates uncertainty for both producers and consumers,"
Rodriguez said, according to the report.

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