
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, July 25, 1990                   TAG: 9007250511
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A/1   EDITION: EVENING 
SOURCE: Associated Press
DATELINE:                                 LENGTH: Medium

OIL PRICE INCREASE STUDIED

OPEC ministers meeting in Geneva today sought a way to boost oil prices and defuse tensions in the Persian Gulf, where Iraq has threatened military action against Kuwait and the United Arab Emirates for exceeding production quotas.

Members declined to discuss Iraq's threats in advance of a meeting of the cartel's eight-member monitoring committee later today.

The 13-nation Organization of Petroleum Exporting Countries formally begins its midyear conference Thursday.

Kuwait's new oil minister, Rasheed Salem al-Ameeri, declined to comment on reports that Iraq has massed tens of thousands of troops on its border with Kuwait, or on earlier Iraqi threats.

Meanwhile, U.S. warships and aircraft are conducting a joint exercise in the Persian Gulf with forces of the United Arab Emirates.

The Pentagon announced Tuesday that six U.S. warships and three aircraft were participating in a "short-notice" exercise.

At the State Department, spokeswoman Margaret Tutwiler said both Iraq and Kuwait had built up their forces and U.S. officials were "very concerned."

Iraq said it will not be intimidated by U.S. pressure.

In Geneva, Iranian Oil Minister Gholamreza Aqazadeh expressed confidence that the cartel would agree to increase its target price, now at $18 a barrel, to $20 or more.

Asked about the effect of the Persian Gulf tensions on the meeting, OPEC Secretary-General Subroto said Tuesday, "We are an economics organization. We talk about economics."

Even Iraq's oil chief, Issam Abdul Raheem al-Chalabi, confined his public remarks to oil prices. He pushed his proposal to lift the cartel's target price to $25 a barrel by cutting OPEC production.

He refused to discuss the reports of Iraqi troop movements.

The troop movements coincide with threats last week by President Saddam Hussein of Iraq to take military action against countries producing oil in excess of their OPEC-set caps.

Kuwait and the United Arab Emirates have stubbornly refused in the past to limit crude output to their quotas. A sharp fall in oil prices in the spring was largely blamed on too much oil on the world market.

by CNB