OPEC ministers yesterday debated raising the organization's production ceiling to bring it in line with real output - a mostly cosmetic move that left markets unimpressed.

　　The ministers of the Organization of Petroleum Exporting Countries were meeting on a proposal by the group's Kuwaiti president and Saudi Arabia, the oil cartel's main producer, ahead of a formal decision expected today.

　　The two said the group is likely to raise its production ceiling 500,000 barrels a day to head off rising prices and calm a jittery international oil market.

　　But even agreement on increasing production above the official ceiling of 27 million barrels a day would have mostly a psychological impact as OPEC is already producing about 700,000 barrels above its quota. The move would do little to alter market fundamentals, or worries that projected strong demand for this year would outpace the 11-nation organization's ability to produce enough crude.

　　Algerian Oil Minister Chakib Khelil reflected widespread pessimism even within OPEC about the proposal, telling reporters: "We can do a goodwill gesture, but it doesn't mean anything in reducing prices."

　　OPEC's president, Sheik Ahmad Fahad Al Ahmad Al Sabah of Kuwait, said any deal to formally up production would lift actual output 2 percent from about 27.7 million barrels to 28.2 million barrels a day for 10 of its members. The 11th, Iraq, is exempt from quota restrictions as it rebuilds.

　　But Al Sabah added that members he had spoken with about the proposal from Saudi Arabia felt a decision should be deferred until it was clear that market conditions warranted such a move.

　　Asked whether OPEC could do anything to cool surging prices, he said: "We have to try to stabilize (the) market," but was unclear whether he thought the ministers would approve such a hike. "We need to decide what is the right time and what is our signal."

　　Oil markets were unimpressed.

　　After falling as low as US$53.52 on Monday following the announcement of a possible rise in the ceiling, light sweet crude hit a high of US$55.05 on the New York Mercantile Exchange and ended the session up 52 cents at US$54.95.

　　Yesterday, it was trading at US$54.89 a barrel by early morning in Europe.

　　Prices had shot up nearly 20 percent in the past five weeks to around US$54 a barrel in New York - little more than a US dollar shy of all-time records. The rise has put pressure on the 11-nation OPEC to take steps to cool the market.

　　Not all OPEC members support raising the ceiling, suggesting there could be arguments when ministers get down to making a final decision today.

　　Libya's Oil Minister Fathi bin Shatwan told reporters: "I don't think I will be (agreeing) with" an increase in the output ceiling.

　　Even if the ceiling is raised, oil traders say the relief is likely to be temporary.

　　"I think China is the key. If China stays hot, OPEC is going to be a tiny bit behind," Lee Fader, a trader for ABN Ambro, said.

　　(The Associated Press)