Saudi King Abdullah (L) greets US Secretary of Energy Samuel Bodman (C) after the opening ceremony of the Jeddah Energy Meeting June 22, 2008. The world's largest oil exporter Saudi Arabia on Sunday proposed setting up a $1 billion OPEC fund and offered $500 million in Saudi soft loans to help poor countries cope with the high price of energy. [Agencies]

Facing strong US pressure and global dismay over oil prices, Saudi Arabia said Sunday it will produce more crude this year if the market needs it. But the vague pledge fell far short of US hopes for a specific increase and may do little to lower prices immediately.

For now, the current "oil shock" leaves Western countries with little choice but to move toward nuclear power and change their energy-consumption habits, Britain's Prime Minister warned at a rare meeting of oil-producing and consuming nations.

Saudi Arabia – the world's top crude exporter – called the gathering Sunday to send a message that it, too, is concerned by high oil prices inflicting economic pain worldwide.

Instead, the meeting highlighted the sharp disagreement between producers like Saudi Arabia and consuming countries like Britain and the United States over the core factors drivZzaing steep price hikes. Oil closed near $135 a barrel on Friday – almost double the price a year ago.