OPEC'S plan to cut its oil production target by 4 percent appears to be unraveling, as group members ignore their self-imposed quotas to take advantage of high crude prices and meet the surging demand for oil in China and the United States.

　　Despite announcing two production cuts in six months, the Organization of Petroleum Exporting Countries has boosted its actual output to try to keep pace with the rising market.

　　OPEC agreed last month to reduce its output ceiling by 1 million barrels a day starting on April 1, in an effort to keep prices from tumbling during a seasonal lull in demand this spring. As OPEC representatives prepare to meet on Wednesday to review the oil market, some are no longer treating next month's cut as inevitable and are suggesting instead that all options - even an increase in output - are now open.

　　That could portend cheaper and more plentiful crude, but it probably wouldn't be enough to comfort American motorists. US gasoline prices have risen to punishing heights due mostly to a robust domestic demand, limited refining capacity and concerns about possible shortages in blending components for reformulated gasoline. Some analysts say that any foreseeable increase in oil supplies probably wouldn't translate into bigger gasoline inventories in time for the peak summer driving season.

　　Crude prices have risen by about US$6 a barrel since OPEC announced its latest cut on February 10. US prices have bumped uncomfortably close to the psychologically important threshold of US$40, though they've backed off somewhat in recent days on evidence of a build-up in crude inventories. Futures contracts of US light, sweet crude for May delivery were trading on Friday at US$35.70 in New York.

　　"You'd have to be a complete idiot to cut production when prices are at these levels," said Adam Sieminski of Deutsche Bank in London. Excluding Iraq, which doesn't participate in the group's quota agreements, OPEC has pumped an estimated 26 million barrels a day so far in March. The logistics of reducing crude shipments now would make it impossible for the group to comply with its new ceiling of 23.5 million barrels even if it wanted to, said Leo Drollas of the Center for Global Energy Studies in London.

　　Costlier crude is now a political issue in major importing countries. White House Chief of Staff Andrew Card urged OPEC last week to increase its production and said the Bush administration would be talking to its "allies" in the group to ensure that they kept supplies flowing, he told MSNBC television.

　　OPEC's 11 members supply about one-third of the world's oil.

　　The group's president, Purnomo Yusgiantoro, told reporters last week that OPEC would discuss three possible strategies when its delegates meet on Wednesday in Vienna, Austria - trimming the output target as planned, leaving it unchanged at its current level of 24.5 million barrels a day, or raising it.

　　Purnomo's newfound flexibility attests to the mixed signals coming from the oil market. Although crude prices are high, some analysts insist there is no real shortage.

　　They point instead to the futures markets, where an unusually large number of "long" positions have helped drive the market upward. A long position is one in which a trader pays a fixed price for a paper contract of crude, hoping that prices will rise and let him cash in his contract later for a profit.

　　(The Associated Press)