Venezuela Calls for OPEC to Consider Additional Output Cut

Orinoco Heavy Oil Belt
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CARACAS (Dow Jones Newswires), Jan. 22, 2009

The Organization of Petroleum Exporting Countries may need to further reduce crude oil output in order to stabilize the oil market, Venezuelan Oil Minister Rafael Ramirez said Thursday.

"Further output cuts are an option that we need to review," Ramirez told reporters at the presidential palace.

Venezuela has already cut 360,000 barrels a day following the last two OPEC reduction agreements, according to the minister.

"We have already notified all our partners, such as Chevron Corp., BP PLC and Total Oil," Ramirez said.

Referring to the possibility of an extraordinary OPEC meeting to discuss the current market scenario, Ramirez said: "If OPEC calls for it, we would attend."

In view of lower oil prices, Ramirez said the government continues to review various oil projects to determine if any need to be shelved. The minister said the government is in talks with oil service companies and other suppliers to cut the price for their services.

"All the services companies know that the rates of the past no longer apply, given the current market reality," said the minister.

Meanwhile, the government will continue to carry on with its licensing round for heavy oil fields in the Orinoco region. Ramirez said there are now 19 foreign companies signed up to present their bids for the fields, known as the Carabobo fields. He said the last new additions to the company list include four Russian oil companies, but he declined to name them.

Venezuela recently reopened the Orinoco region for bids by foreign oil companies, the first such offering in more than a decade.

The government of President Hugo Chavez has made it clear it will continue to seek partners in the energy sector among state-owned oil companies from countries considered political allies.  

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