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Cheney and King Abdullah talk oil

Latest update : 2008-03-24

US Vice President Dick Cheney and Saudi Arabia's King Abdullah met outside Ryadh to discuss prospects for the oil industry and ways to deal with record prices. Cheney also held talks with the Saudi oil minister.

RIYADH - U.S. Vice President Dick Cheney and Saudi Arabia's King Abdullah shared some common views about factors in the oil market that have pushed prices to record highs, a senior U.S. official said on Saturday.

Cheney and Abdullah held about 4-1/2 hours of private, one-to-one meetings on Friday at the king's farm on the outskirts of Riyadh, where the vice president also met the Saudi oil minister.

"There was I think a lot of commonality in their assessment about the structural problems confronted by the global energy market now and some discussion of probably the way forward, how we work together to try and stabilize the market," the U.S. official told reporters travelling with Cheney.

The talks covered "what could be done shorter-term, but probably more about what's necessary to do over the medium to longer term," he said.

The official would not give details of the discussions between Cheney and the Saudi king, a U.S. ally and leader of the world's top oil exporter, calling them confidential and private conversations.

Cheney's trip follows a visit to Saudi Arabia by President George W. Bush, who in January called for OPEC to increase production, but the crude oil exporters' group decided to hold production steady.

Saudi Arabia is the only OPEC member that can easily add significant amounts of extra oil to the market. Record-high oil prices have dealt a blow to the U.S. economy, which has also been contending with a housing market crisis.



PRODUCTION CAPACITY

Cheney, on Monday in Iraq, outlined some of the structural problems he saw that had pushed oil prices above $100 a barrel -- not a lot of excess production capacity worldwide, rising demand from countries like China and India, and the declining value of the dollar.

The senior administration official said Cheney and Abdullah also discussed the commitments made by the king during his visit to Bush's Texas ranch as crown prince in 2005.

"That I think is coming close to being fulfilled on billions of dollars of Saudi investment into increasing capacity, and I think that's being done," the U.S. official said.

Oil prices have risen to record highs above $100 a barrel because investors have piled into commodities as the value of the U.S. dollar has sharply fallen. The price fell below $100 on Thursday on fears of a U.S. economic slowdown.

Cheney and King Abdullah also discussed Iran, Iraq, Syria, Lebanon, Afghanistan, Pakistan and Israeli-Palestinian issues, the official said. Cheney reviewed his visits this week to Iraq and Afghanistan with Abdullah.

The United States wants Saudi Arabia and other Arab allies to establish a diplomatic presence in Iraq and help reconstruction efforts in Afghanistan.

Cheney was due to leave Saudi Arabia later on Saturday for Israel where he will meet Israeli officials, followed by meetings with Palestinian officials over the weekend.
 

Date created : 2008-03-22

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