King Abdullah of Saudi Arabia said OPEC shouldn't make oil a source of conflict, contradicting Venezuelan President Hugo Chavez who...

King Abdullah of Saudi Arabia said OPEC shouldn't make oil a source of conflict, contradicting Venezuelan President Hugo Chavez who wants the oil exporter group to become an active ``political agent.''

``Oil is an energy for building and prosperity, it shouldn't become a means of conflict,'' King Abdullah said at the start of the group's heads of state summit in Riyadh today. ``Those who want OPEC to become an organization of monopoly and exploitation ignore the truth.''

The Organization of Petroleum Exporting Countries, provider of more than 40 percent of the world's oil, is holding its third heads of state summit since it was founded in 1960. The Saudi foreign minister clashed yesterday with a push by Iran and Venezuela to debate pricing oil in currencies other than the U.S. dollar.

``OPEC was born as a geopolitical force and not only as a technical or economic one in the '60s,'' Chavez said, speaking before King Abdullah. ``We should continue to strengthen OPEC, but beyond that, OPEC should set itself up as an active political agent.''

The contrasting view on OPEC's role in the world comes a day after a disagreement between Venezuelan Oil Minister Rafael Ramirez and Saudi Foreign Minister Prince Saud Al-Faisal on whether to move away from the dollar was accidentally broadcast on live television.

`Fair' Level

Chavez said in his speech today he's confident OPEC will do what it can to keep oil prices at a ``fair'' level, adding that if Iran was invaded, prices could easily rise to $200 a barrel.

Crude oil for December delivery yesterday rose $1.67 to $95.10 a barrel on the New York Mercantile Exchange.

``The current price of oil if we take into consideration inflation is less than what it was in the early 1980s,'' Abdullah said. High taxes in consuming nations were hurting consumers more than the producers, he said.

The last OPEC heads of state summit was in 2000 in Venezuela and was hosted by Chavez, who was sworn in as president a year earlier. Iran and Venezuela both have tense political relations with the U.S.

Ibrahim Ibrahim, an executive at Qatar Petroleum, said that while Venezuela has helped OPEC become a stronger organization over the years, ``there is no need for OPEC to be a political force now. It just has to ensure that the oil market is stable.''

By Maher Chmaytelli and Ayesha Daya

To contact the reporters on this story: Maher Chmaytelli in Riyadh at mchmaytelli@bloomberg.net Fred Pals in Riyadh at fpals@bloomberg.net

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