960429

Iraqi oil sales

noto to weaken

prices, says

Saudi Arabia

RIYADH: Saudi Arabia said on Wednesday that Iraq's return to the oil market would not weaken prices as world demand has been rising and OPEC can cooperate with other producers to maintain stability. "I do not believe the international market will be much influenced, and cooperation between OPEC countries and producers outside the cartel is possible to maintain prices," said Foreign Minister Saud al-Faisal.

"Iraq's entire production could be easily absorbed, given the current rise in demand," he added during a visit to Tokyo, according to the official Saudi Press Agency.

Iraq and the United Nations on May 20 signed an agreement to implement UN resolution 986 to allow Baghdad to export two billion dollars of oil over six months in return for food and medicine but under strict controls.

The specialist Middle East Economic Survey (MEES) said Monday that the firs t Iraqi oil exports could begin as early as July.

Prince Saud also said "the region's stability could not be re-established without Iraq's application of all UN resolutions concerning the invasion of Kuwait."

"There also is resolution 687 demanding the dismantling of Iraq's weapons o f mass destruction ... which is one of the only guarantees for establishing peace in t he region," the Saudi minister said.

Saudi Arabia served as the main base for US-led coalition forces which launched Operation Desert Storm to free Kuwait from seven months of Iraqi occupation in the 1991 Gulf War.-AFP