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FOR IMMEDIATE RELEASE: February 12, 2004

SCHUMER: OPEC MAY BE WAVERING ON OIL SUPPLY CUTS – PRESIDENT SHOULD WEIGH IN AND PUSH TO KEEP PRODUCTION UP

Reports say OPEC leader may be having second thoughts about plans for million-barrel-a-day production cuts and plans and another 1.5 million-barrels-a-day in future cuts

With Crude Oil prices already skyrocketing, Schumer urges President to weigh in and ask OPEC not to turn off the tap

With published reports today indicating that Organization of Petroleum Exporting Countries (OPEC) leaders may be second-guessing their plans to cut oil production by up to 2.5 million barrels a day, US Senator Charles E. Schumer today asked President Bush to weigh in and urge the Kingdom of Saudi Arabia and other OPEC leaders not to make the cuts, which were specifically designed to drive up the costs of gasoline and home heating oil prices.

"It's too soon to say, but there may be a quiet voice of reason emerging from OPEC – one that says brazen profit-taking doesn't play well on the world stage," Schumer said. "Now is the time for the President to help turn the volume up so gas prices stay down."

On Tuesday, OPEC announced that it intends to withdraw 1 million barrels of crude oil a day from the world's markets, which would lower the OPEC's production objective to 23.5 million barrels a day. OPEC members also promised to reinforce their self-imposed quotas and cut production by another 1.5 million barrels a day. These cuts were spearheaded by Ali al-Naimi, the oil minister of Saudi Arabia, OPEC's pivotal and most productive member. They would be the second and third OPEC production cuts in less than five months, but according to published reports today OPEC may be backtracking on their proposal. As an immediate result of the proposed cuts, crude oil prices shot up 3 percent in New York on Tuesday. Schumer said he is concerned that this will quickly result in higher gasoline and home heating prices.

Schumer also took OPEC to task for their statements that they cut production to pre-empt developments that might cause oil prices to decline – namely increased production by Russia, Norway and other oil-producing nations that do not belong to OPEC. Schumer has long championed increasing bringing more non-OPEC oil to New York, and in September joined Russian President Vladamir Putin to open a new chain of gas stations in the metropolitan area that only sell gas made from Russian oil.

"It's incredible that at the first sight of a little good old fashioned economic competition, OPEC immediately turned to tactics to take advantage of New Yorkers. But now it looks like the balance at OPEC might be tipping, and some people at OPEC might finally get the fact Russian oil is here to stay. President Bush could put this plan over the top and bring down gas and oil prices for all of us – and he should," Schumer said.

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