Saudi Arabia looks set to face down Opec price hawks and push through an oil supply increase at this month's cartel meeting to prevent a politically damaging spike in crude prices this winter.
Cartel insiders and oil analysts said Riyadh is shaping up to lift output quotas at the September 19 gathering in Osaka, Japan, to meet extra fourth quarter demand .
Riyadh wants to prevent oil prices running out of control and damaging fragile world economic growth at a time when it is trying to repair diplomatic relations with the United States.
"Given the atmosphere in Washington at the moment I don't think Saudi Arabia is willing to take price risks," said analyst Roger Diwan of Petroleum Finance Company in Washington.
Approaching the anniversary of the September 11 attacks on the US, blamed mostly on Saudi nationals, Riyadh won't want to anger the biggest buyer of its crude by letting others in Opec force prices too high.
"If Saudi goes for too small an increase, prices will overshoot and they'll be in more trouble politically with the US," said Diwan.
"Clearly the Saudi relationship has been strained since 9/11. Saudi Arabia wants to keep some kind of positive relationship with Washington, diplomatically if not publicly," said Kyle Cooper of Salomon Smith Barney in Houston.
US crude was trading at $28.90 a barrel last Friday, pricing a basket of Opec crudes near $26.50, near the top end of the group's $22-$28 target range.
The kingdom will have to twist arms among fellow producers to convince them more oil is needed to stop crude breaching the dangerous $30-a-barrel barrier.
The Saudi camp declined comment but sources said that signs are that it sees room to raise output quotas by something like a million barrels per day (bpd).
Venezuela, Kuwait and Indonesia oppose any increase, arguing that current supplies are sufficient. And an Opec delegate said this week that number two cartel producer Iran also sees no need for more oil.
Cash-strapped producers like Venezuela and Nigeria now suffering budget crises don't want to trigger a price fall that would hurt export revenues.
Venezuelan President Hugo Chavez made the Saudi task more difficult by announcing in public that he was against easing restrictions.
"The rest of Opec doesn't want to risk lower prices but Saudi doesn't want to risk a political backlash," said Diwan.
"They want to keep prices moderate because they know that $30 oil is not good for them in the long term. It does not bode well for world demand growth. And in Opec, usually, what the Saudis want, they'll get," said Cooper of Salomon.
Opec cutbacks in place since January have, on paper, kept five million barrels daily off the 76 million bpd world market although heavy cheating by several member countries on official limits has helped keep prices in check.
Saudi Oil Minister Ali al-Naimi is likely to argue that the leakage has put Opec's credibility on world oil markets in question.
"Credibility is the issue," said Gary Ross of PIRA Energy consultancy in New York. "They have to legitimise some overproduction in case they need to cut again next year."
Naimi will also want to prevent a situation where Washington decides prices are high enough for it to supply its own cure - by releasing oil from the national strategic petroleum reserve.
"Saudi wants to underline its role as the central banker of the oil market," said Diwan.
Current leakage of some 1.8 million bpd over official limits of 21.7 million bpd for 10 members is Opec's poorest record of compliance since the cartel cut supplies in 1999 to reverse a slump at that time into single digit prices.
Key to Riyadh's final call on how much extra oil is needed will be a final review of the supply and demand outlook, and most crucially, fuel inventory data.
While inventories normally rise strongly during the third quarter, this year they have moved little, setting the stage for a big draw on world markets during the fourth quarter.
The International Energy Agency in Paris sees demand rising 1.9 million to 78.2 million bpd in the fourth quarter.