The New Nation - Internet Edition

Agencies, Washington

Concerned that skyrocketing oil prices might induce a worldwide economic slump, Saudi Arabia is planning to increase oil production next month by about a half-million barrels a day, The New York Times reported on its website late Friday.

Citing unnamed analysts and oil traders who have been briefed by Saudi officials, the newspaper said the increase could bring Saudi output to a production level of 10 million barrels a day.

The move is seen as a sign that the Saudis are becoming increasingly nervous about both the political and economic effect of high oil prices, the report said.

While they are reaping record profits, the Saudis are concerned that record prices might eventually dampen economic growth and lead to lower oil demand, as is already happening in the United States and other developed countries, according to The Times.

The current prices are also making alternative fuels more viable, threatening the long-term prospects of the oil-based economy, the paper said.