OPEC is already gearing up to fend off an oil price collapse that might follow any US assault on major Gulf producer Iraq.

Although world oil prices have shot well past $30 (€27.86) a barrel amid war fever and political turmoil in OPEC member Venezuela, key oil ministers are warning that markets could tip into over-supply during the second quarter and spark a price crash.

"If there is danger of a glut, we have to meet and rectify the situation. Definitely we are concerned about the second quarter," the United Arab Emirates oil minister, Mr Obaid bin Saif al-Nasseri, said yesterday.

"Typically there is less demand then, and I hope this increase or the change of the ceiling won't affect it so badly." Mr Nasseri was referring to a decision by the Organisation of the Petroleum Exporting Countries to increase supplies by 1.5 million barrels per day to 24.5 million barrels per day from February 1st to cover an export shortfall from strike-bound Venezuela.

Lead OPEC producer Saudi Arabia said oil markets were not starved of crude now and vowed that the cartel would keep pumping enough oil to meet its higher output limit. "I can assure you that we, Saudi Arabia, will make sure that 24.5 million barrels per day is delivered," said its oil minister Mr Ali al-Naimi.

But higher volumes from the exporter group may only set the stage for a sharp decline in prices during the second quarter, which typically sees a seasonal drop in demand of about two million barrels per day due to warmer weather in the northern hemisphere.

"It seems everybody now is producing above the market requirements to make the market cool," said the Libyan oil minister Mr Abdulhafidh Zlitni. "Supplies are sufficient... and the build up of stocks will have a negative impact on prices, certainly."

Oil market analysts share the ministers' expectation of lower prices with one recent poll of analysts projects that world oil prices, now at two-year highs, are set to slump by $10 a barrel in the second half of the year after any war against Iraq.

In the event of a military assault, OPEC president Mr Abdullah al-Attiyah and Mr Nasseri of the United Arab Emirates expected a price spike at the start of action followed by a decline when it starts to wind down.

"I believe there will be no panic. Any price spike would be brief," said Mr Attiyah, also oil minister of Qatar. "I don't believe some analysts who say prices will reach $100, or $60."

The OPEC chief predicted a particularly grim outlook from April if exports in fellow member Venezuela are fully restored. "If Venezuela comes back (to full capacity), we could have four million bpd or more floating," he said, adding the excess could be at least three million bpd based on its current output.

If that proves the case and "there are signs in March that prices are falling sharply", Mr Zlitni of Libya said OPEC could reduce supplies at its March 11th meeting.

Given Washington's military preparations in the Gulf, the OPEC meeting - which is expected to focus on the state of world stockpiles - could take place against the backdrop of an attack on Iraq, the world's eighth-biggest oil exporter.

In a bid to calm market fears of supply disruptions, Naimi insisted Saudi Arabia would be prepared, if needed, to make use of its excess capacity, which he pegged at 2-2.5 million barrels per day.

Industry sources say the kingdom is pumping close to nine million barrels per day and Mr Naimi has made clear Riyadh can raise that to 10 million within weeks. The Saudi oil minister said OPEC stood ready to make up for any supply shortages on its own without major consuming countries having to release their emergency stockpiles.