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Sep 11 - 17, 2000

Clinton gets S. Arabian support

US President Bill Clinton said on Thursday that Saudi Arabia's Crown Prince Abdullah had assured him of supporting a rise in oil output to bring down soaring prices.

Clinton, speaking to journalists on the fringes of the UN Millennium Summit, said Prince Abdullah agreed that high oil prices could spark a recession. "I told him I was very concerned that the price of oil was too high, not just for America, but for the world," said Clinton.

Iranian President Mohammad Khatami, too, implicitly favoured a hike in production. "In principle, we are not against the output rise in proportion to the rise of the world demand," Khatami said at a press conference on Thursday. He said increased demand was expected over the next three months.

About his talks with Prince Abdullah, Clinton said he told the Saudi prince "that if it's a cause of recession in any part of the world, that would hurt the oil producing countries. He agreed with that. He's been very strong about that."

Clinton said he hoped that members of the Organization of Petroleum Exporting Countries (OPEC), who meet in Vienna on Sunday, would raise output to stem price hikes, as they had agreed during their last ministerial meeting in March. "I said I certainly hoped that when OPEC met there would be an increase in production because that was the policy they adopted," Clinton said. "They adopted a policy that said if the price got outside a range, as I remember the range, it was 22-28 dollars a barrel, and they would take appropriate action. So I hope that they will."

The OPEC ministerial meeting in Vienna will discuss price rises amid indications that oil ministers would agree to a rise in output.

Iran hopes its new moderate image will help tourism

Iran hopes its improving image abroad will help lift its depressed tourism industry, but many fear Islamic social restrictions could keep foreigners away.

"The bitter truth is that our negative image, created by negative propaganda, has been a fatal poison for our tourism industry since the revolution," says Iran's chief tourism official Mohammed Moezzeddin.

"We want to improve this image and President (Mohammed) Khatami's open-door and detente policy is the main key to this goal," he told journalists this week.

Intense anti-West feelings and the bloody 1980s war against Iraq scared away many foreigners. Some of the best relics of pagan and Islamic tradition in the historic cities of Shiraz and Isfahan were left as neglected ruins.

Tourism collapsed and the new rulers, wary of the cultural drawbacks of the industry, ignored it for almost a decade.

The idea to revive tourism resurfaced after the war, when Iran needed hard cash to rebuild, and it is still seen as an alternative source of foreign currency to oil exports.

Khatami's limited social liberalisation and foreign policy overtures have been of some help to the tourist industry. More people are travelling to Iran, but visitors are largely limited to Muslims and small groups of ageing Westerners, usually on tours.

Officials say about 1.7 million tourists visit Iran a year, spending up to $800 million. Iran hopes the number of foreign visitors will more than double in five years' time.

In a country where vital economic interests often clash with deep-seated moral values, tourism officials are struggling to highlight Iran's natural and historical advantages against religious controls in hopes of enticing tourists.

Oil blasts off as consumers rage

Booming oil markets poured fresh riches into OPEC coffers on Thursday amid consumer rage in the West over high fuel costs and fears of a winter supply crunch.

Prices at 10-year peaks proved immune to news of a rise in US oil inventories and brushed off word from OPEC sources that all options were open at a key policy-making meeting on Sunday.

"This continues to be a market which is only going in one direction," said Lawrence Eagles of London brokers GNI.

Brent crude rose 0.6 percent to trade up 22 cents at $34.50 a barrel, its highest since the crisis over Iraq's 1990 invasion of Kuwait, before settling back to $34.20, off eight cents.

The rise was the fourth straight day of 10-year peaks on North Sea Brent, a benchmark grade used for pricing a swathe of international trade in raw material crude oil.

Clinton's talks with Arafat, Barak fail to bridge gap

US and Israeli officials expressed pessimism on Thursday after President Bill Clinton failed to bridge gaps between Israel and the Palestinians in a last-ditch effort to break the impasse in the Middle East peace talks.

"(Palestinian leader Yasser) Arafat's position didn't change, he did not budge an inch and (Israeli Prime Minister Ehud) Barak feels he cannot go any further and time is running out," a senior Israeli official said.

The official spoke after US Secretary of State Madeleine Albright briefed Mr Barak on the status of the talks.

Another senior Israeli official described the situation after Albright's meeting with Barak as "dire". "The situation is very bad, sad - it's dire. There are no signs of progress whatsoever and there is little hope of breaking the deadlock," the official said.

The official said Barak would give the process "two more weeks", and then turn to internal matters.

Kuwait finds gas in north

Gas-hungry Kuwait has found natural gas in two northern fields but has yet to assess the actual size of the reserves, an official source said on Tuesday.

The source told Reuters Kuwait made the natural gas finds in Raudhatain and Sabiriyah fields close to the nothern border with former occupier Iraq.

Kuwait is currently studying the purchase of natural gas from neighbours Qatar and non-Arab Iran, which sit on the world's largest reserves after Russia, mainly to meet domestic demand for power generation.

Experts say Kuwait's need for gas could reach a critical level later this decade, highlighting its keeness to tap large reserves in al-Dorra offshore gas field in the Gulf which is claimed by OPEC members Saudi Arabia, Iran and Kuwait.

OPEC seen 'powerless' as oil soars

Oil prices raced to yet another 10-year peak on Wednesday as anxious dealers feared OPEC would fail to ease a supply shortage when its ministers meet on Sunday.

US light crude futures were up 30 cents at $34.13.

High fuel costs are rattling the United States and other major crude consumers who are crying out for more oil.

But OPEC states which supply the bulk of internationally traded petroleum say tight supplies of refined products like heating oil are keeping prices up rather than any severe shortage of raw material crude.

OPEC powerhouse Saudi Arabia tried to spell out that reality to a nervous market on Tuesday.

Influential Saudi Oil Minister Ali Al-Naimi said the world's biggest oil exporter sees no problem in adding extra crude to world supply even though markets are not as tight as current record prices suggest.

Old guard survives

King Mohammed VI of Morocco on Wednesday reshuffled the government he inherited a year ago on the death of his father, trimming it down from 42 to 33 members but keeping the old guard.

Socialist Prime Minister Abderrahmane Youssoufi remains in post, with 27 ministers and six junior ministers.

Hopes that the young king would reshuffle the government have been running high during recent months, with several newspapers saying the ruling executive needed "a second wind" to be able to tackle the country's economic crisis.

Bahrain resort

Saudi investors plan to build a tourist resort, including a five-star hotel, in Bahrain at an estimated cost of between $75-$100 million, Bahrain's Finance and National Economy Ministry said on Wednesday.

It said in a statement that the ministry signed an agreement on Wednesday leasing a plot of land to the investors to build the resort near the capital Manama.

Kuwait bourse

Kuwait's stock market rose 1.7 per cent in the week to Wednesday, erasing most of the year's decline with a 7.3 per cent gain in three weeks.

Some brokers expect the upward trend to continue, possibly moving the Kuwait Stock Exchange (KSE) into positive territory above last year's 1,442-point close.

KPC net profit

Kuwait's state oil firm KPC enjoyed a leap in net profit to about $2.6 billion in the fiscal year to June some $778 million above projections amid rallying energy markets.

Libya seeks investment

Libya has invited international oil companies to take part in joint ventures to upgrade and expand its refining and petrochemical industries, the Middle East Economic Survey (MEES) reported on Monday. The authoritative industry newsletter said Libya's National Oil Corporation (NOC) is seeking bidding from a selected number of companies on joint ventures to build a new refinery at Sebha and to upgrade refineries at Ras Lanuf and Azzawiya.

Iran issues tenders for new Gulf gas blocks

Iran has called for tenders to develop the latest phases of the giant South Pars gas field in the Gulf, press reports said Sunday, quoting the National Iranian Oil Company.

The two tenders cover phases nine and 10, and 11 and 12, with projected total daily output of 105 million cubic metres (3.675 billion cubic feet) of gas and 160,000 barrels of crude oil.

The NIOC said bidders for the buy-back type contracts could be individual firms or consortia.

The first three phases of South Pars have already started production, while Italy's ENI has won a contract to develop phases four and five estimated at 3.8 billion dollars.

Phases six to eight are in the hands of the British-registered Iranian company Petro-Pars, whose boss Mansur Rezvani said recently that foreign firms could be associated with the venture.

Morocco raises oil products

Morocco rised the price of refined oil products by up to 10.8 per cent due mainly to a surge of crude oil prices on the international market, the official MAP agency said on Saturday.

Morocco, which has no oil of its own, is expected to import this year more than seven million tonnes of crude oil, mainly from the Gulf countries at the cost of $1.4 billion.

Jordan ministers in Baghdad

Iraqi Trade Minister Mohamed Mahdi Saleh welcomed two Jordanian ministers who arrived here Monday for a visit of several days to discuss ways on increasing Jordan's exports to Iraq.

"Economic cooperation between Iraq and Jordan is important and exchanges between the two countries has reached 1.4 billion dollars in the context of the 'oil for food' programme," Saleh said.

Jordanian Trade Minister Wassef Azar and Transport Minister Mohammed Al-Kalaldeh will also look at ways to increase Iraqi imports via the Red Sea port of Aqaba, a Jordanian official earlier said in Amman.

Tourist village

Oman has started building the first phase of a $150 million tourist village in the southern coastal town of Mirbat to attract more holidaymakers to the Gulf Arab state, a project official said on Monday.

Oman private power plant

Oman's fourth private power project planned to be built in the coastal town of Barka would cost around 175 million rials ($455 million), the official Oman News Agency (ONA) said on Tuesday. It said the 400-megawatt Barka power project would include a 20 million gallon water desalination plant.

Lebanese pound stabilizes

The sweeping weekend electoral victory of billionaire former prime minister Rafiq Hariri helped to stabilize the Lebanese pound Monday, an economist said.

At the same time, Solidere, the giant real-estate firm in which Hariri is one of the major shareholders, shot higher on the stock market.

The Lebanese pound, which trades in a fixed range of 1,502-1,514 to the dollar, appreciated to 1,511 from 1,514 on Friday.

The pound had been under strong pressure during the recent electoral campaign, with the Central Bank of Lebanon having to intervene several times to keep it within its trading band.

Tourist project

Orascom Telecom's (OT) chairman and CEO Naguib Sawiris has announced that preparations will soon begin for the construction of a tourist village in the special economic zone in Aqaba, Jordan at an estimated cost of $350 million.