OPEC has forged ahead with tighter oil supply curbs, deaf to consumer country complaints about crude prices recently at 13-year highs.
The Organisation of the Petroleum Exporting Countries (OPEC) agreed to cut output despite calls from the United States for cheaper fuel.
OPEC president Purnomo Yusgiantoro told CNBC television the decision was necessary to prevent global oversupply of four million barrels per day (bpd) by the end of June.
The Bush administration, in an election year, had pressed OPEC to lift export restrictions to help control prices at the pump and prevent energy inflation slowing economic growth.
Delegates said cartel powerhouse Saudi Arabia led the push for implementing cuts of one million barrels a day or 4 per cent from April 1st, as first agreed in Algiers in February.
The White House stopped short of openly criticising OPEC but called for adequate supplies and said: "It is important for producers not to take actions that hurt our economy." OPEC blames speculative investment funds, now commanding record positions on energy contracts, for this year's oil price spike.
Oil prices fell sharply after the deal. A big weekly build in US crude inventories led the slide but expectations among traders that OPEC will be slow to enforce its lower quota limits also undermined prices.
Benchmark US crude dropped $1.00 to $35.25 (€28.62) a barrel, down from a recent peak of over $38 on the New York Mercantile Exchange.
Saudi Arabia's regional Gulf allies Kuwait and the United Arab Emirates had recommended OPEC consider delaying tighter output restrictions to allow oil prices to cool.
The split among OPEC's core Gulf members raised speculation that the United States is now targeting Kuwait and the UAE, instead of Saudi, for diplomatic efforts aimed at getting lower prices.
Delegates said that to meet Kuwaiti and UAE concerns it was privately acknowledged by Saudi that actual supplies would not be cut much more in April, unless oil prices fall.
Despite a ritual call from ministers for full adherence to quotas, the behind-the-scenes sop to Kuwait and the UAE appears to be a less than rigorous requirement to immediately meet new limits.
Kuwaiti Oil Minister Sheikh Ahmad al-Fahd al-Sabah admitted that it would be May before cartel compliance improved. - (Reuters)
