Saudi Arabia, the world's biggest oil producer, yesterday backed an immediate production cut of one million barrels a day as the Organisation of the Petroleum Exporting Countries indicated its determination to defend $60 (€47.5) as a new minimum international price.

Saudi backing for such a cut, and warnings that Opec should consider a second in December, pushed up oil prices sharply even before the cartel - which controls 40 per cent of the world's supplies - agreed a final declaration at a meeting in Qatar.

Opec oil ministers were last night still discussing the divisive issue of how to share the burden of cutting production and revenue. Nymex and Brent crude futures, the world's two benchmarks, both jumped almost a dollar as Ali Naimi, Saudi Arabia's oil minister, made the kingdom's position clear.

He told reporters as he arrived in Doha: "The price is determined by the market, what we try to do is to make the market balanced. Today there is a disequilibrium between supply and demand. Today we are trying to get the market to the normal equilibrium and the price will take care of itself."

He added: "The possibility of another cut is there."

Vera de Ladoucette, an analyst at the consultancy Cambridge Energy Research Associates, said: "Usually when the decision is taken it has already been priced into the market. But sometimes Opec can surprise."

Oil producers have watched with concern as crude oil inventories have grown, indicating that the market is over-supplied.

US inventories of crude have risen in the past week by 5.1 million barrels a day to levels 8 per cent above those of a year ago. But despite its price concerns, Saudi Arabia does not want to return to being Opec's swing producer of oil. Opec will therefore need to share the cuts and subsequent revenue reductions among its members. - (Financial Times service)