Saudi Boosts Oil on US Pressure

Saudi Arabia has announced it will increase oil production by about 300,000 bpd, its highest level in two years, following intense pressure from the US.

The decision follows a plea by US President George Bush to King Abdullah of Saudi Arabia in Riyadh, last week.

The kingdom's oil output is expected to hit 9.45 million bpd by next month, according to the Saudi oil ministry.

According to the ministry, the move is necessary to compensate for lower output from other OPEC producers.

Oil prices peaked to US$127 after climbing near to US$128 a barrel last week.

US light crude for June delivery has gone down 32 cents at US$125.97 a barrel today, while London Brent crude has dropped 85 cents at US$124.14 a barrel, according to Reuters.

By staff writer