Oil falls despite Iraq call for cuts

Saudi Arabia has pledged to keep oil exports flowing to make up for any shortfalls

LONDON, England -- Oil prices fell on Monday after Saudi Arabia said it would fill any shortage caused by Iraq's call for more cutbacks in production.

Iraqi President Saddam Hussein, in a televised address on Monday, reiterated his call for Arab producers to cut output by half to protest against Israel's military incursions in Palestinian territories.

Hussein also called on Arab producers to ban sales of oil to the United States and Israel.

Brent crude for June delivery was down 24 cents to $25.61 a barrels in late London trading. Prices had earlier dropped to a session low of $26.56 after peaking at a high of $26.40.

Hussein stopped all exports of oil on April 8 in an attempt to force Israel to withdraw its troops from the West Bank. He said the cut would last until Israel withdrew or for 30 days, at which stage the decision would be reviewed.

On Monday, Saudi Arabia -- a major player within the Organization of Petroleum Exporting Countries -- reiterated that it would ensure oil supplies continue to flow at current levels despite any possible disruptions.

"We have made statements saying that Saudi Arabia and OPEC will make up any shortage due to any reason -- political, military or natural disasters," the country's Oil Minister Ali al-Naimi told a conference on U.S.-Saudi relations in Washington.

"The question is when to make the move without destabilising the market."