Oil-producing countries were under mounting pressure last night to increase output after the World Bank, the International Monetary Fund (IMF) and finance ministers from the world's richest countries identified the high price of fuel as the biggest threat facing the world's economy. The French finance minister, Mr Laurent Fabius, will write to the Organisation of Petroleum Exporting Countries (OPEC) this week on behalf of the European Union, asking the oil producers to take steps to bring down the price of oil.

"We have strayed from a rational market equilibrium and it is our duty to reset this market's reference points. If the current pressures were to be perpetuated, they could threaten the pursuit of global growth," Mr Fabius told the IMF's policy-making body, the International Monetary and Financial Committee in Prague yesterday.

Finance ministers from the Group of Seven (G7) leading industrialised countries, who were in Prague on Saturday, gave their backing to President Clinton's decision to release part of his country's oil reserves in an attempt to reduce prices. But the ministers rejected reductions in fuel tax in response to the oil price rise and put the ball clearly in OPEC's court.

"It is crucial for the world economy that OPEC and oil producing countries take actions to contribute to a reduction in oil prices and greater stability in oil markets," the ministers said in a statement.

Oil-producing countries, including Saudi Arabia, Algeria, Russia and the United Arab Emirates, joined western representatives on the IMF's policymaking committee last night in a warning that high fuel prices could damage economic growth.

"The committee is concerned that current oil prices, if sustained, could hamper global growth, add to inflationary pressures and adversely affect prospects for many countries. The committee notes the steps the oil producing countries have taken this year to increase production and calls on them to take further steps to create conditions in oil markets conducive to healthy global growth," the International Monetary and Financial Committee said in a statement.

The IMF also identified the over-valuation of some equities and "misalignments" in the foreign exchange markets - a clear reference to the low level of the euro against the dollar - as threats to the world economy.

"While the overall outlook is positive, the committee remains mindful of the remaining risks associated with the continuing economic and financial imbalances in the global economy. These potential challenges include imbalances in external accounts and the possible risk from misalignment in exchange rates and high levels of equity valuations in the major currency areas," the statement said.

Venezuela's President, Mr Hugo Chavez, insisted yesterday that OPEC was not to blame for the high price of oil and said that western countries should get used to paying a fair price for their fuel.

"There's a trend in developed countries to try to persuade people that OPEC is the ogre, that OPEC is guilty of causing the increase in prices for fuel, the increase in inflation. That's not true. The thing is that for a century they took millions of barrels of oil at give-away prices, that's part of the problem - they got into bad habits," he said.