Sept. 11 (Bloomberg) -- A Saudi Arabian-backed plan to temper high oil prices by raising oil production at today's OPEC meeting in Vienna is meeting resistance from Venezuela, Algeria and Libya.

Oil prices above $77 a barrel are a burden to consuming nations, prompting some Persian Gulf producers to discuss raising OPEC quotas by at least 500,000 barrels a day at the meeting today. The group's biggest producer, Saudi Arabia, proposed an increase, Iraq's oil minister said before the talks started.

OPEC wants ``to make a statement that there is enough oil to be supplied and there could be more oil coming if the market needs it,'' Falah al-Jibury, an adviser to the Iraqi Oil Ministry, said in an interview in Vienna.

Oil prices have risen 27 percent this year after members of the Organization of Petroleum Exporting Countries curbed exports to drain inventories. The world's biggest oil companies, including Exxon Mobil Corp., are profiting from high prices, and bumper revenue is encouraging producing nations such as Russia and Kazakhstan to take greater control of their energy resources.

Crude oil for October delivery was down 31 cents at $77.17 a barrel on the New York Mercantile Exchange at 3:23 p.m. Vienna time, after rising as high as $78.32 earlier today, 45 cents shy of a record. Oil ministers from OPEC's 12 member nations are gathered at the group's Vienna headquarters for closed-door talks. A press conference is scheduled for later today.

Three Choices

OPEC ministers are reviewing three options, al-Jibury said. The first is to keep production quotas unchanged; the second is to increase production by 500,000 barrels a day, which ``is not sufficient,'' and the third is to raise production as much as 1 million barrels a day.

``Legitimizing the million barrels seems to be the dominant opinion among those who think they want to affect the market, give the market comfort that there will be enough oil,'' al-Jibury said. ``Raising the ceiling would be in the interest of the market.''

Last week, all 23 oil traders and analysts in a Bloomberg survey said they expected OPEC to keep its output target unchanged.

``OPEC often decides at the last minute,'' Vera de Ladoucette, an analyst with Cambridge Energy Research Associates, said in an interview in Vienna today. ``Prices are now too high for Saudi Arabia and the Gulf states who don't want to be scapegoats for an economic slowdown.''

OPEC members already pump more than their quotas allow. The 10 members with quotas produced 26.71 million barrels a day last month, or about 900,000 barrels a day more than targeted, according to Bloomberg estimates. The 10 members agreed to at two meetings late last year to cut a total of 1.7 million barrels a day.

Saudi View

Saudi Oil Minister Ali al-Naimi declined to comment to reporters in Vienna on production targets. OPEC President Mohamed al-Hamli, who is also oil minister for the United Arab Emirates also declined to comment. Iraqi Oil Minister Hussain al-Shahristani said Saudi Arabia wants more oil in the market, though he added that a final decision would need to be made by consensus.

``There will be a need to increase supply sometime in the fourth quarter,'' said Roger Diwan, director of oil market research at Washington-based consultancy PFC Energy, said in Vienna today. ``I think they will decide today to have a small increase and then signal that they would do more if needed later on.''

Opposed to Increase

Venezuelan Oil Minister Rafael Ramirez told reporters earlier today that OPEC has no need to change production quotas, while his Qatari counterpart Abdulla bin Hamad al-Attiyah said OPEC has ``a lot of options'' at its meeting today.

Shokri Ghanem, chairman of Libya's state-run National Oil Corp., has said there's no need for more supply now and that he will support a supply increase later in the year if demand rises. Oil supplies are ``a little tight,'' said Kuwait's acting oil minister, Mohammed Abdullah al-Aleem.

``We don't support an increase as far as Algeria is concerned,'' Algerian Oil Minister Chakib Khelil said today. ``Right now we don't see sufficient evidence'' to justify adding more supply to the market, he said.

Adam Robinson, an energy analyst with Lehman Brothers Holdings Inc. in New York, said he doubts a 500,000-barrel-a-day increase would have a ``huge'' impact on prices.

``What it does say is the Saudis are willing to boost production if there is a cold snap early in the winter and that may have more of an impact on the market,'' he said in an interview.

Iran's acting oil minister, Gholam Hossein Nozari, said earlier today that he supports keeping quotas steady and that OPEC shouldn't be blamed for any economic deterioration.

Compromise Solutions

OPEC members have previously compromised when they weren't sure whether to alter quotas by allowing the OPEC president to authorize supply changes or call an emergency meeting if needed.

One such time was at a meeting in Isfahan, Iran, in March 2005, when the group said it ``authorized its President, after consultations with fellow heads of delegation, to announce an additional 500,000 barrels a day increase in the ceiling, until its next meeting, should oil prices remain at current levels or continue to further rise.''

OPEC has previously expressed concern that a slowdown in economic growth in the U.S. may put a dent in world oil demand.

Algeria's oil minister Khelil said earlier today that OPEC could delay its decision until it gathers for a heads of state summit in Riyadh in November, or at its next scheduled ministerial conference in early December in Abu Dhabi.

OPEC should be wary of repeating the ``wrong decision'' it took in late 1997 at a meeting in Jakarta, when it boosted output just before an Asian economic crisis curbed oil demand, leading to a price slump to $10 a barrel, Khelil said.

To contact the reporters on this story: Fred Pals in Vienna through the London newsroom fpals@bloomberg.netMaher Chmaytelli in Vienna through the London newsroom 2166 or mchmaytelli@bloomberg.net

Last Updated: September 11, 2007 10:56 EDT