Ecuador’s president urges political role for OPEC

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The Associated Press

Ecuadorean President Rafael Correa, in his first public speech since his country’s official re-entry into OPEC, said Nov. 18 that the 13-nation oil producer group must take on a more political role and that current oil prices remain historically low.

Correa said he joined his Venezuelan ally, President Hugo Chavez, in arguing for the Organization of Petroleum Exporting Countries to assume a more political role — a position that other members, including the group’s de facto leader, Saudi Arabia, have clearly opposed.

“I agree completely” with Chavez, he told a news conference in the Saudi Arabian capital of Riyadh on the sidelines of OPEC’s heads-of-state summit.

“OPEC needs a political vision to manage a strategic resource,” Correa said. “It is denying reality,” to try and reduce OPEC to a purely technocratic role, he said.

Correa did not directly back comments by Chavez that $100 a barrel is a “fair” price for oil, but said that current prices, when adjusted for inflation, still remained low.

“The price of oil is still lower than in the 1980s,” he said.

The weakening of the U.S. dollar has eroded the value of oil earnings for producers, and Iran and Venezuela have pushed for possible ways to counter that, such as an oil currency basket — a move Saudi Arabia opposed earlier in the week.

“We have to trade (our oil) in a strong currency,” Correa said Nov. 18, arguing that to do otherwise means that oil producing countries end up “transferring” the value of their oil to richer countries. He did not further elaborate.

Correa also said OPEC has the clout in the energy market to help coordinate a battle against global warming.

He suggested an environmental tax could be imposed on richer, consumer nations that would help advance alternative fuels and also “compensate” poorer, developing countries trying to industrialize.

“There must be co-responsibility,” between consumer and producer nations in battling environmental issues and ensuring energy security, Correa said.

Ecuador left OPEC in 1992 saying it couldn’t afford to pay membership dues and disagreed over OPEC’s production quotas at the time.

Although Ecuador currently produces around 510,000 barrels per day of crude oil, the government aims to have an OPEC quota of 530,000 bpd.