Egypt plans to turn around declining crude oil output

CAIRO, Egypt -- Egypt plans to increase oil output, reversing a steady decline in recent years, the Egyptian oil minister said Saturday.

Speaking at the opening of the 7th Arab Energy Conference, Sameh Fahmy said Egypt was trying to increase both production and exploration for additional reserves.

Egypt's probable oil reserves have more than doubled in the past three years owing to successful exploration. Yet in 1999, the maturation of existing fields and growing domestic demand made the country a net importer for the first time in decades.

Egypt's output of crude has declined from 922,000 barrels a day in 1996 to 639,000 barrels a day during the first 10 months of 2001.

The conference, which brought together the members of the Organization of Arab Petroleum Exporting Countries, revealed divergent views on whether oil should be used as a political weapon.

Saudi Arabian Oil Minister Ali Naimi reiterated his oil-rich Gulf state's commitment to long-term stability within the international oil market.

"In its capacity as the biggest oil producer and exporter, the kingdom of Saudi Arabia is keen to maintain stability in the international oil market in the short- and long-term at a price level that guarantees fair income to the producing countries to support further investment in the petroleum industry," Naimi told reporters at the conference.

Early last month, Iraq suspended oil exports in a bid to force the United States, a significant importer of Iraqi crude, and other Western states to put pressure on Israel to cease its military operation in the Palestinian territories. This week Iraq resumed exports, criticizing other Arab producers for failing to join its cutoff.

Egyptian President Hosni Mubarak made clear his country is opposed to such tactics.

"We tell the whole world that we respect oil consumers and endeavor to provide stability to their economies," Mubarak said in a statement read to the conference by Prime Minister Atef Obeid.

However, the head of the Iraqi delegation, Oil Ministry Undersecretary Saddam Hassan, said Iraq views oil not from a commercial point of view but as an instrument of "independent national policy that counters American hegemony."

Amr Moussa, the secretary general of the Arab League, which co-hosted the conference, came down somewhere between the Egyptian and Iraqi positions.

Arab oil producers, Moussa said, have "the right to, and insist on demanding, a policy that establishes a just peace, ends the killing, aggression and bloodshed, and does not protect, as is happening now, Israel in its racist and imperialist aggression against Palestine and the Palestinians."

The Organization of Arab Petroleum Exporting Countries groups Algeria, Bahrain, Egypt, Iraq, Kuwait, Libya, Qatar, Saudi Arabia, Syria and the United Arab Emirates.

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Mubarak was in the Red Sea resort of Sharm el-Sheik for meetings with the Syrian president and Saudi crown prince on Saturday.