OPEC agrees to 500,000 barrels extra a day

Seeking to cool volatile markets, Opec ministers today agreed to pump an extra 500,000 barrels of oil a day immediately and held out prospects of another production boost later if needed.

The move appeared in line with a proposal by the oil cartel’s president, Kuwaiti Oil Minister Sheik Ahmed Fahd Al Ahmed Al Sabah.

He suggested yesterday that Opec ministers, meeting in Isfahan, the Iranian oil capital, would agree to a rise in output of 500,000 barrels a day, and follow it some time in the future, if necessary, with another hike of 500,000 barrels a day.

Saudi Arabia, the group’s major producer, had threatened to go it alone if other oil producers balked at stepping up output.

It said it would likely pump an extra 500,000 barrels a day even if other members persisted in opposing raising the present group ceiling of 27 million barrels daily.

Crude prices dipped today in anticipation of the decision by the Organisation of Petroleum Exporting Countries.