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Aug 21 - 27, 2000

Algeria, Iran leaders to meet over ties resumption

Algerian and Iranian heads of state are expected to meet in New York in September with a view to ending seven years of frozen ties, a senior Algerian official said on Wednesday.

Algiers, which has accused Iran of backing the outlawed Algerian Islamic Salvation Front (FIS) and other armed rebels charges denied by Tehran cut its diplomatic ties with Tehran in 1993.

"We were, the least we can say, a little bit hurt that the Algerian tragedy made Tehran (officials) too quickly happy," Algerian President Abdelaziz Bouteflika was quoted by the official as saying.

In an effort to breathe new warmth into their relations, Bouteflika said he would meet his Iranian counterpart Mohammad Khatami next month in New York, the official, who declined to be named, reported.

The meeting would take place on the sidelines of next month's United Nations General Assembly session.

Algeria and Iran are also active members of the OPEC cartel.

The information was made public by Bouteflika after talks with Venezuela's President Hugo Chavez on Tuesday over bilateral issues and matters related to the oil-producers' cartel OPEC, of which Algeria and Iran are both members, the official said.

"I believe that many people in Algeria follow with sympathy the policy of openness which President Khatami is undertaking (in Iran)," Bouteflika was quoted as saying.

Earlier this year Khatami, a reformist battling against conservative clerics, called for an improvement in relations with Algeria after years of tensions.

"I believe that much of what has happened in the past was due to misunderstandings, and logic requires us to look towards the future," Khatami said.

State plan being re-assessed, says Arafat

Palestinian leader Yasser Arafat said on Wednesday the Palestinian Liberation Organization (PLO) is reassessing its plan to formally declare the independence of the Palestinian state on Sept 13.

Arafat said a decision on whether to declare the state of Palestine would be taken only at "the beginning of next month" in a move likely to ease pressure on a newly declared resumption of peace talks with Israel.

"We have decided the course, but we have to reassess this," Arafat told journalists after meeting Indonesian leader Abdurrahman Wahid at the presidential palace.

"I made long tour all over the world and I have (received) many advices from many international leaders (that the declaration of a Palestinian state should be made) after the Israeli election," he said.

Israel has said the election could be held as early as the spring of 2001.

Earlier, Indonesian President Abdurrahman Wahid refused to lend support to the declaration of an independent Palestinian state in his talks with Arafat.

Asked if Indonesia would support a unilateral declaration, Wahid said, "No. We will be deciding (abiding) by the decision of the (Organization of) the Islamic Conference and the United Nations resolution."

Arafat said the reassessment would be conducted by the central council, the Palestinians' second-highest decision making body.

Palestinian officials have said the council is to meet next month.

Arafat had earlier said he would proclaim the state on Sept 13, but since the Camp David summit broke down on July 25, he has been increasingly vague about whether he will stick to the deadline in the face of strong US and Israeli pressure.

Khamenei rules out improvement in ties with US

Iran's supreme leader Ayatollah Ali Khamenei on Wednesday again ruled out reopening ties with the United States, the official IRNA news agency reported.

Khamenei blasted Washington's efforts to secure a Middle East peace deal, which has long been opposed by Tehran, and said the United States was trying to impose its will on the region.

"The true objective of US propositions during their negotiations is to impose their will," Khamenei said, calling on the diplomats to remain "vigilant and attentive towards Iran's relations with Europe".

He told the diplomats they should develop relations with Asia and other Muslim nations and "resist both the Zionist regime and US support for this regime". They must also "present Iran's point of view on the issue of Palestine", Khamenei said, cited by IRNA.

Iran, which has not recognized Israel since the 1979 revolution, is opposed to the US-led peace process and expressed delight when the Camp David peace talks failed last month.

OPEC chief says no plans for output hike

OPEC President Ali Rodriguez of Venezuela said on Wednesday that the oil cartel had no plans to increase production yet, despite sizzling oil prices, insisting that the group would stick with its price band mechanism.

Under the $22-28 a barrel price target mechanism approved in March, OPEC should raise or lower output by 500,000 barrels per day (bpd) if prices remain above the band for 20 consecutive days or below the band for 10 days.

Asked if OPEC was planning a 500,000 bpd output increase at the moment, Rodriguez said: "It's not planned. Of course if the conditions which were established (in the band mechanism) occur, then it (a production increase) will happen." The price of OPEC's basket of seven crudes stood at $28.69 a barrel Tuesday, keeping it above the cartel's price band for a second consecutive day.

Brent crude rises to near 10-year high

The price of benchmark Brent crude oil for September delivery rose to well above 32 dollars a barrel, the highest level for nearly 10 years, in trading here on Tuesday.

The price of benchmark Brent crude for September delivery was showing a gain of 77 cents from the closing price on Monday to 32.25 dollars a barrel.

In New York on Monday, light sweet crude for September delivery had closed with a gain of 92 cents to 31.94 dollars a barrel.

Venezuela's Chavez reaches Libya

Venezuelan President Hugo Chavez arrived in Tripoli on Sunday for talks with Libyan leader Muammar Gaddafi on an OPEC summit planned for next month in the Venezuelan capital Caracas.

"The president arrived this morning and he will leave in this afternoon after meeting Gaddafi. The two leaders did not meet yet," an official at the Venezuelan embassy in Tripoli said by telephone.

Chavez, who came from Jakarta where he met Indonesian President Abdurrahman Wahid, is touring all fellow OPEC states to promote the cartel's first summit in 25 years in Caracas on September 27-29 and to discuss OPEC production levels amid bullish oil prices.

Private radio, television

Jordan's House of Representatives has approved the opening of private radio and television stations in the kingdom, ending the state's monopoly, a source in the parliament said Thursday.

In a session late Wednesday, the parliament voted to allow the government to authorize Jordanian or foreign companies to open TV or radio stations in the kingdom so long as they "respect the objectives and values of the Jordanian state." The measure annulled the monopoly rights given to state television and radio.

Suez Canal to be enlarged

The Egyptian government has given the go-ahead for work to widen and deepen the Suez Canel to permit the passage of supertankers, a spokesman for the canal authority said Thursday.

The 441 million-dollar project will allow the use of 200,000 tonne ships of 62-foot (20.5 meter) draft next year, compared with 60 feet now, spokesman Hassan Refaat told.

The expansion work will increase the width of the Suez Canel from 345 to 400 meters (380 to 440 yards) and its depth from 22 to 25 meters (72 feet to 82 feet), bringing in enough water to permit the passage of 92 percent of existing commercial ships, Refaat said.

Fitch affirms

Fitch IBCA rating agency on Thursday affirmed its stable outlook rating for Kuwait on the back of high crude prices and the emirate's considerable returns from its extensive foreign assets.

The London-based ratings agency also affirmed short- and long-term foreign currency ratings for Kuwait at "F1" and "A" respectively. Fitch's top short-term currency rating is "F1," while its best long-term currency rating is "AAA." "The Kuwaiti economy is benefiting from high world (oil) prices and the July increase in its OPEC quota to 2.037 million barrels per day. The current account surplus is forecast to double in 2000," the agency said in a statement.

Jordan, Syria to discuss economic ties

Jordan's Prime Minister Ali Abu Al-Ragheb left for Syria on Thursday for top level talks on ways of expanding economic ties amid improved political ties, officials said.

They said Abu Al-Ragheb would attend a two-day meeting of the Jordanian-Syrian Higher Committee, the umbrella forum that reviews progress in a wide span of fields.

Jordan's ties with Syria have improved dramatically since relations soured after the late King Hussein signed a peace deal with Israel in 1994 which Damascus saw as a sellout.

They started to improve again when the late Syrian president, Hafez Al-Assad, attended King Hussein's funeral in Amman in February 1999 and began to develop a good relationship with his son and heir, King Abdullah.

Lebanon BoP deficit

Lebanon's balance of payments recorded a $144.9 million deficit during the first half of the year, compared to a deficit of $149.3 million in the same 1999 period, the central bank said on Wednesday. It said the deficit for the month of June alone was $114.4 million. In May, the balance of payments was $80.2 million in surplus.

Bahrain trade surplus

Bahrain's trade surplus for the first six months of 2000 hit a 10-year high of almost 600 million dollars on the back of a doubling in oil export earnings, a newspaper reported Wednesday.

The six-monthly surplus of 225 million dinars (590 million dollars) was up 19.7 percent from 188 million dinars (493 million dollars) in the same period of 1999, the Gulf Daily News said, quoting a central bank report.

The increase was propped up by a doubling in the value of oil exports to 697 million dinars (1.8 billion dollars) in the first half of this year from 358.2 million dinars (943 million dollars).

The Gulf archipelago's non-oil exports also increased, up 10 percent at 306.5 million dinars (803 million dollars) from 278.4 million dinars (729 million dollars).

Iran discovers new major gas field

Iran said on Sunday it had discovered a new on-shore gas field with recoverable reserves of 4.7 trillion cubic feet (133.1 billion cubic metres) of sweet gas and 58 million barrels of liquid gas.

The new field, called Homa, is located in a mountainous region south of Fars province, said Mohammad Mohaddes, director of exploration at the National Iranian Oil Company (NIOC).

Homa borders Tabnak, Iran's largest onshore sweet gas field with estimated reserves of 445 billion cubic metres (15.7 trillion cubic feet), and two other fields Shanoul and Varavi, he said.

"Given that this gas is sweet, it does not require refining and the gas can be injected into the national network after its liquid gas is extracted," Mohaddes told state radio.

Syria sees growth

Syria is expecting its decision to allow foreign banks operate in free trade zones for the first time in decades to accelerate growth there, the director of the project said on Sunday.

Ghatfan Refai, director of Syria's General Organisation for Free Zones (GOFZ), told Reuters three Lebanese banks had been given licences while five other banks with mixed Lebanese-foreign ownership had already applied for licences from GOFZ.

Microsoft breaks ground

Microsoft GEM (Gulf and Eastern Mediterranean) has officially marked the start of construction work on its regional headquarters at Dubai Internet City (DIC), according to a press release. The global market leader is expected to move its regional operations to the new purpose-built location in Spring 2001.

Arab Insurance

Bahrain-based Arab Insurance Group, the Arab world's biggest reinsurer, said on Tuesday it made a net loss of $15.6 million in the first half of 2000 compared with a $4.7 million net profit a year earlier.

SABIC plans

Saudi Arabia's industrial giant Saudi Basic Industries Corp (SABIC) said on Monday it planned to expand ammonia production capacity at its affiliate National Chemical Fertiliser Company (Ibn Al-Baytar). A SABIC statement said it would raise Ibn Al-Baytar output to 583,000 tonnes per year (tpy) of ammonia from the current 500,000 tpy.

Analysts predict

Oil prices could rise to 40 dollars a barrel in New York by the end of this year, analysts said on Wednesday, as price levels remained around 10-year-high levels here.

The chief economist at the Centre for Global Energy Studies Leo Drollas said prices could rise to 40 dollars a barrel in New York and 35 dollars in London by the end of this year but only if the Organisation of Petroleum Exporting Countries (OPEC) did not agree an output increase at its ministerial conference in Vienna on September 10.

Aramco orders four supertankers

Saudi Arabia's national oil giant Saudi Aramco has ordered four supertankers from the South Korean firm Hyundai Heavy Industries Co., the official SPA news agency reported Wednesday.

Each of the four super tankers will have a capacity of 300,000 tonnes and be able to transport two million barrels of crude oil with a range as far as the Americas, Europe and the Far East, the agency said, without disclosing the value of the order.

The tankers, which will be delivered in 2002 and 2003, will replace four tankers to be taken out of service.