OPEC will turn off the tap

OPEC on Wednesday forged ahead with tighter oil supply curbs from April, deaf to consumer country complaints about crude prices close to 13-...

OPEC on Wednesday forged ahead with tighter oil supply curbs from April, deaf to consumer country complaints about crude prices close to 13-year highs.

The Organisation of the Petroleum Exporting Countries agreed to turn down the taps despite calls from the United States for cheaper fuel.

Benchmark US crude rose 28 cents to 36.53 a barrel, supported by a new all-time high on the New York Mercantile Exchange8217;s gasoline contract of 1.1775 a gallon.

The Bush administration, in an election year, had pressed OPEC to lift export restrictions to help control US pump prices and prevent energy inflation slowing economic growth.

OPEC powerhouse Saudi Arabia led the push for the cartel to implement cuts of one million barrels a day from April 1, as first agreed in Algiers in February.

8216;8216;The Saudis have gone from being a reliable OPEC price dove to OPEC8217;s arch price hawk,8217;8217; said energy consultant Mehdi Varzi.

8216;8216;That8217;s because of the demands of the Saudi budget. They need higher and higher oil prices every year to meet current expenditure for a larger and larger population.8217;8217;

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Saudi Arabia8217;s regional Gulf allies Kuwait and the United Arab Emirates had recommended OPEC consider delaying tighter output restrictions to allow oil prices to cool.

The split in ranks of OPEC8217;s core Gulf membership raised speculation that the United States is now targeting Kuwait and the UAE, instead of Saudi, for diplomatic efforts aimed at getting lower prices.

Most in OPEC blame speculative investment funds, who hold record positions on energy contracts, for this year8217;s price spike.

8216;8216;We estimate speculative funds have already invested 15 billion in oil futures contracts in New York and London,8217;8217; said Gary Ross of leading US Energy consultancy PIRA Energy.