OPEC nations have cut the proportion of their deposits denominated in dollars by more than 13% in the past three years, according to the Bank for International Settlements.

Middle Eastern central banks have switched reserves from dollars, moving mainly to euros but also to sterling. This was reportedly done to avoid incurring losses as the US dollar continues to fall and to prepare for a shift away from pricing oil exports in dollars alone, the Financial Times reports.

The Bank for International Settlements - a forum for world central banks - attributed the trend partly to US interest rates having fallen below euro-zone levels.

In its latest quarterly report, the bank said dollar-denominated deposits fell to 61.5% of total deposits by members OPEC in the second quarter of 2004, from 75% in the third quarter of 2001.

The share of euro-denominated deposits rose to 20% from 12% over the same period.

Meanwhile OPEC secretary general and Indonesian oil minister Purnomo Yusgiantoro has told reporters in Jakarta that the price band for crude oil should be raised to reflect inflation since 2001 and the falling US dollar.

Other OPEC officials share his views, according to the Wall Street Journal.

A growing number of players inside the Organisation of Petroleum Exporting Countries is seeking to establish a floor price of $US30 for a basket of crude-oil varieties sold by the cartel, several oil officials from member nations told the newspaper.

The higher floor would be about US40 a barrel for the more-prized US light, sweet benchmark crude. This would represent an increase of more than a third over the present target of $US22 to $US28 for the basket of OPEC crudes.

Such a move would mark an attempt to keep prices at recent levels.

But the cartel has had trouble in previous years enforcing production discipline among its members, and high oil prices could make it irresistible for some producing nations to sell more oil.

And while OPEC pumps more than a third of the world's oil, non-OPEc members produce almost two-thirds of the total. So despite OPEC’s strong influence over world markets, efforts to maintain a higher floor were likely to fall short, the newspaper said.

Meanwhile the Iranian government has urged the members of OPEC to adhere to official quota targets.

Iranian oil minister Bijan Namdar Zanganeh said OPEC should be worried if it kept on overproducing.

“The primary concern will be the observance of the quotas set already,” Zanganeh said.

“The prices have a downhill trend. The oil price will come down, as we have a huge amount of oil in the market and on the sea.”

He said OPEC should consider cutting its official ceiling of 27 million bopd by 500,000 to 1 million bopd.

OPEC currently exceeds its official ceiling, largely because of increased production in Saudi Arabia.

OPEC oil ministers will meet in Cairo on Friday to discuss production quotas and price for the first quarter of next year.