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About The Battalion. (College Station, Tex.) 1893-current | View Entire Issue (March 25, 1986)
Tuesday, March 25, 1986/The Battalion/Page 9 OPEC meeting ends; oil prices slide Cartel fails to agree on cut in oil production ie$ d 3 ■sident )f per- inday, te en- I pack- ovem- honed at tht ers of red re- regime e than londu- search s indi- jan at- an any ous at- ■r Rob- ila said onday tch for it on a d and saying would r Sand- omthe uppon errillas fire, bi- icgotia- :r Bob ters he a per- ney. i to 80 xrsal to idinista ong bi- Associated Press GENEVA — A marathon OPEC meeting broke up Monday after the cartel’s members failed to agree on how to cut oil production in an at tempt to reverse the slide in prices. The collapse of the tumultuous talks sent open-market oil prices into a dive, although industry analysts said OPEC still had a chance of pushing prices back up if it agreed later on deep cuts in production. The price of the most popular grade of U.S. crude plunged more than $2.50 a barrel to just over $1 1 in early trading on the New York Mercantile Exchange. A one-sentence OPEC statement issued at the close of the meeting said oil ministers from the 13-mem- ber Organization of Petroleum Ex porting Countries planned to meet again on April 15 to resume the ne gotiations. The Geneva talks lasted nine days and marked one of the longest con ferences in the cartel’s history. The final session ended in tur moil, with the OPEC president, Ar turo Hernandez Grisanti of Venezu ela, and many other ministers slipping out of the hotel without re sponding to reporters’ questions. The usual post-meeting news con ference by the cartel president was canceled with no explanation. Fawzi Shakshuki, the oil minister of Libya, said the ministers were aiming at a production ceiling of be tween 14 million and 15 million bar rels a day. They currently produce about 17 million barrels daily. All 13 member countries have concluded that their best chance of reverse the price slide is to cut pro duction in order to dry up the world oil glut. OPEC experts estimate that the cartel is pumping about 2 million barrels a day more than the market can absorb. Demand for oil is ex pected to fall even more in the com ing few months. Philip Verleger, an oil analyst at the consulting firm of Charles River Associates in Washington, said he expected open-market oil prices to hover in the range of $10 to $12 a barrel unless OPEC regrouped and reached a decision on significant cuts in its oil production. Oil company chief says oil prices will rise by year's end Associated Press LOS ANGELES — The head of [Chevron Corp. predicted Monday [that foreign producers will reverse falling oil prices by summer and that prices will rise by more than 50 per cent by the end of the year. Separately, a General Motors [Corp. executive said methanol will be the fuel of the 21st century and urged the oil industry to begin i adapting now, adding, “Only those who are stuck in old thinking will perish.” Chevron Chairman George Keller |and GM Vice Chairman Howard Kehrl made their comments to the [annual meeting of the National Pe troleum Refiners Association. Both men warned that the United [States remains in danger of again be- Hng held hostage by the Organizaion (of Petroleum Exporting Countries unless the United States reduces its dependence on imports. Keller urged the government to impose stiff fees on imported oil that fis subsidized by foreign govern ments. “It’s very important for the fed- feral government to use its powers “We believe that, in the long run, windfalls and wind storms blow no real good. ” — Howard Kehrl, vice chairman of General Mo tors Corp. under the General Agreement on Tariff and Trade to insure that ev eryone is playing on a level field,” Keller said. However, Keller opposed a pro posal for a general import levy on foreign oil. Others in the industry support a general levy, contending it would allow domestic producers to charge higher prices, thus making it profitable for them to continue costly exploration and encouraging consumers to conserve fuel. Oil prices have sky-dived from about $30 a barrel in November to about $13 a barrel, forcing most ma jor oil companies to slash explora tion budgets by 30 percent or more as consumers switch from economy cars to gas guzzlers. Keller predicted OPEC “will reach some sort of agreement on prices” by summer. He forecast crude oil prices of about $20 per barrel by year-end. He also took a swipe at proposals to eliminate some of the industry’s most coveted tax breaks, including investment credits and lengthening the amount of time required to de preciate capital expenses. “If we ever hope to achieve pre-OPEC stabil ity in America, we must cut the string . . . on our energy price yo-yo. ” — Howard Kehrl. “All of these would have the effect of blighting the prospect of growth and renewal for America’s heavy in dustries,” Keller said. “Many of is provi< MewmaHi nguishcd >n to his | where he • -lustier." | ;’s awards [ dvance of j Board ol j ary 0s® illiant alt ers, w 110 :ture win- ; 1 for the an Award t and "hh g others." . pickford, "g lour uble i ed- guaf gptioP skills read is thafl m h26 T exas ASM Flying Club COME LEARN TO FLY WITH US Interested people are urged to attend our meeting March 25 at the Airport Clubhouse. For more information Call Don Read 696-9339 7:30 P.M. SPRING SALE MARCH 24-APRIL 6 Waist)))\Bdskef FOR INFORMATION CALL 846-1013 402 TARROW them, like refining, have not yet r e covered from the last downturn in our economy.” Kehrl termed cheap oil “ill winds” that help automakers in the short run by increasing sales, but threaten the energy industry and banks and raise the specter of renewed depen dence on oil imports in the long run. Keller and Kehrl offered differ ent solutions to meeting federal fuel emission standards. Keller suggested new controls could be instituted by automakers, while Kehrl suggested that gasoline marketers bear most of the burden but only be required to impose the controls in regions that have the worst smog and in the worst smog season. Keller also opposed a House plan that would increase the nation’s toxic-cleanup Superfund by $1 I bil lion over the next five years by plac ing most of the costs on the oil indus try, favoring instead a Senate version that would boost the fund to $7.5 billion over five years and spread the costs to all manufactur ers. Procrastination leads to taxation. An urgent message from Merrill Lynch: If you don’t open an IRA by April 15, there’s no time left to procrastinate. For those of you who have contemplated opening an IRA, but keep putting it off “until tomorrow,” your “tomorrows” are running out. April 15 is just around the corner.* And if you don’t open an IRA soon, you’ll miss out on a very important tax break. Our knowledgeable Financial Consultants will show you how a Merrill Lynch IRA is not just a tax savings, but a plan that allows for flexible investments. With a choice of over 50 investment opportunities, your IRA can be specifically tailored to your needs. From fixed-income securities to emerging growth stocks to government securities. So hurry. Call the number below, mail the coupon or come down to Merrill Lynch today. And don’t put off ’til tomorrow what you should do today. 409-776-5636 or 1-800-433-4462 i 1 Mail to: Merrill Lynch, Pierce, Fenner & Smith Inc. 3131 East 29th Street, Stanford Court, Bldg. C, Bryan, TX 77802 □ Please send me your free Merrill Lynch IRA brochure. Name Address. City .State- Business Phone. .Home Phone. -Zip_ Merrill Lynch customers, please give name and office address of your Financial Consultant: An eligible IRA must be established and your contribution made before April 15, 1986. ©Copyright 1986 Merrill Lynch, Pierce, Fenner & Smith Inc. Member SI PC. Merrill Lynch JU MSC Wiley Lecture Series U.S. Interventionism: Resolving International Conflict April 1, 1986 8:00 p.m. — 10:00 p.m. Gerald R. Ford Former President of the United States Jimmy Carter Former President of the United States Dr. Stephen Ambrose U.S. Foreign Relations Specialist, Author, Rise to Globalism George Will, Moderator Pulitzer Prize Winning Columnist James Earl Rudder Auditorium, Texas A&M University Tickets: MSC Box Office (409) 845-1234 • Ticketron Student Non-Student Zone 1 Zone 2 $10 $ 8 $12 $10 MasterCard and VISA accepted. Zone 3 $6 $8 Call Battalion Classified 845-2611