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Saudi says oil security main topic at Riyadh meeting

DUBAI (Reuters) - Security of oil supplies will be a core topic at a meeting of Asian oil exporters and consumers in OPEC kingpin Saudi Arabia this week, the Saudi oil minister said in remarks broadcast on Monday.

Ali al-Naimi, in an interview with the state-run television, did not say if the talks would tackle contingency plans in case tensions between fellow OPEC exporter Iran and the United States over Tehran’s nuclear program led to a military confrontation in the world largest oil exporting region.

“The most important thing for consumers and producers is the security of energy,” Naimi said.

“Consumers are interested in receiving supplies at a suitable time and at the desired volume. As for producers, energy security is represented in securing a guaranteed market for their output. This is one of the main topics which would be discussed.”

Days after Riyadh said it foiled a militant plot against its oil facilities, the Saudi capital will host the second meeting of Middle East and Asian oil ministers, where importers will be looking for reassurance that oil facilities can be protected.

Security of supply is a constant concern for Asian importers, who buy 55 percent of their oil from the Middle East.

The United States, which says Iran is trying to build an nuclear bomb, has said it wants a diplomatic solution to the standoff but has not ruled out military action if that failed.

Iran says its nuclear program is only for power generation, but the standoff has raised regional fears of a war.

Each year of Asian economic expansion feeds growing demand for crude from the Middle East, home to 60 percent of the world’s oil reserves.

Naimi said consumers and producers will also discuss investments that would achieve economic integration between the two sides of the equation.

“The benefit of the round table (meeting) is to promote investments between Asian countries,” he said. “For example producers need investments in refineries, petrochemical plants and marketing and consumers would like to have investments in services; in gas exploration and so on.”

The price of oil will also be high on the agenda, analysts said. London Brent traded at just under $68 a barrel on Monday, and has risen 33 percent from a mid-January low.

Naimi reiterated his country’s long standing oil policy. “The policy of the kingdom is clear. Moderation in all aspects ... stability of the petroleum market and stability of prices within a reasonable range and to make sure that prices do not have a (negative) impact on the growth of the global economy...”

The ministers of six members of the Organization of the Petroleum Exporting countries will be at the Riyadh meeting, a follow up to the first Middle East and Asian energy ministers meeting in India early 2005.

Asian ministers may ask OPEC to open the taps and reverse some of the 1.7 million barrels per day in cuts the producer group agreed late last year. Consumers have called on OPEC to help bring the price down and prepare for the seasonal rise in demand in the third quarter.

But OPEC ministers have said the crude market is balanced and blamed the high price on tight gasoline supplies in the United States and international political tension.