Aug. 4 (Bloomberg) -- Saudi Aramco, the world's largest oil company, has started production at two new fields three months ahead of schedule and may delay the shutdown of older wells to help meet increased oil demand, company officials said.

The development of the offshore Abu Safah oil fields and the mostly onshore Qatif fields may boost the nation's output capacity by 800,000 barrels a day, or 8 percent, when full commissioning is completed in as long as three months, Aramco spokesmen said in telephone interviews from Dhahran.

The new supplies will help ease concern that the world is running short of production capacity as energy demand surges, led by the U.S. and Chinese economies. Oil prices earlier today reached record highs in New York and London, surpassing $40 a barrel. Oil prices slid in New York.

``It should be enough to bring prices off the boil,'' said Irene Himona, an analyst at Morgan Stanley in London. Prices are now in a ``bubble,'' she said.

Most members of the Organization of Petroleum Exporting Countries and other oil nations are pumping near their limits to meet demand.

Oil futures fell in New York, where crude for September delivery were down 15 cents at $44 a barrel as of 10:25 a.m. Yesterday it closed above $44 for the first time since the contract was introduced in 1983.

OPEC pumped the most oil in 25 years in July, a Bloomberg survey showed, and OPEC President Purnomo Yusgiantoro said yesterday output gains won't be immediate. Saudi Arabia, the largest producer in OPEC, pumped 9.36 million barrels of oil per day in July, according to a Bloomberg survey.

The new facilities at Qatif, which holds 8.4 billion barrels of oil, will be the first in the kingdom to produce Arab Light crude oil by blending Extra Light and Arab Medium. The Abu Safah field contains 6.1 billion barrels of oil.

To contact the reporter on this story: Sean Evers in the Dubai office at evers@bloomberg.net

Last Updated: August 4, 2004 10:27 EDT