OPEC third-ever summit will kick off in Saudi Arabia

Nov 17, 2007, 13:51 GMT

Riyadh - The heads of states of the 13 Organization of Petroleum Exporting Countries (OPEC) are gathering in Riyadh later Saturday for a summit expected to focus on the falling value of the US dollar, rising oil prices and the effect on poorer nations.

Among the leaders attending the two-day meeting are King Abdullah Bin Abel-Aziz of Saudi Arabia, the host country, in addition to Hugo Chavez, president of Venezuela.

Mahmoud Ahmadinejad, president of Iran and Jalal Talabani, president of Iraq is also expected at the cartel's third summit. The opening ceremony is expected to start Saturday evening.

Adding to the tension, on the eve of the meeting, Abdallah Salam al-Badri, OPEC's secretary general, rejected a request to reference the weak dollar in a final declaration to be agreed at the end of a summit Sunday.

The Iranian request would not be part of the final document, he said.

In a note before a preparatory meeting of the OPEC summit, Iranian Foreign Minister Manouchehr Mottaki had requested that Iran's 'concerns over the weak performance of the US dollar' be mentioned in the summit's concluding statement.

Venezuela was quick to support the Iranian call, but Saudi Foreign Minister Saud al-Faisal said it would lead to a 'collapse' in the US currency.

Prices hovering around the 100 dollar-a-barrel mark and concerns about stock shortages will overshadow the organization's meeting, according to observers, nevertheless OPEC officials said the issues would only be discussed during the regular policy meeting in Abu Dhabi in December.

The summit sessions instead will focus on energy supplies and issues of climate change - which are matters of less impact to concerns on oil prices and quotas, according to observers.

One of its signature aims, according to the OPEC summit website, is to ensure 'the stabilization of prices in international oil markets with a view to eliminating harmful and unnecessary fluctuations.'

However, earlier the organization said it has nothing to do with the alarmingly high prices, and increasing supply will have little impact on this upward movement.

This reaction signalled OPEC's reluctance to increase its output to help curb increasing oil prices, which affect the poorest oil- importing countries most.

Suleiman al-Harbash, head of the OPEC Fund for International Development, told reporters ahead of the summit that during the past years, the fund had allocated '30 billion Saudi Riyals' (8 billion dollars) to help development in poor countries.

A bulk of the aid goes to establishing energy facilities, schools, hospitals and road construction, he said.

The idea that such funds are perhaps a way by which OPEC distances itself from the harmful effect of the soaring oil prices on poor countries was also floated at al-Harbash's press conference on Saturday afternoon.

When asked if the organization either monopolizes oil wealth or uses the needs of other countries 'to get rich,' al-Harbash said that people have 'a distorted picture' of OPEC.

'OPEC invests in developing and poor countries across the world,' he said. 'The oil-producing countries are happy to extract natural wealth from the depths of the earth in order to create wealth above the land, build civilizations and (cause) constant development.'