OPEC Pushes Off Decision on Further Production Cut
The Organization of Petroleum Exporting Countries (OPEC) pushed off its decision on whether to cut production again and will revisit the issue on December 17 during their next meeting scheduled to take place in Algeria. In a statement released after today’s meeting in Cairo, the oil cartel warned that demand for crude oil will be “much lower” than originally expected last month.
Also, the Saudi oil minister Ali al-Naimi said that his country believes that $75 per barrel represents a “fair price” needed to support further investment in oil fields.
OPEC pledged that it would take any “additional action” needed to stabilize the market, according to the group’s president.
Plummeting oil prices have already hit both the producers and drillers. According to forecasts from the U.S. Department of Energy, OPEC’s oil export revenue for 2008 will be nearly 10 percent less than expected just a month ago.
OPEC Secretary General Abdalla El-Badri has been calling for outside help to stem the massive drop off in crude oil prices. ”All non-OPEC countries should come and help, it is a big burden for OPEC,” he told reporters. As well as Russia, “the ones we know that have the capability to cut are Norway and Mexico.”
While Russia’s energy minister is expected to attend the upcoming meeting in Algeria, it doesn’t seem they’ll be receiving much help from Norway. “I don’t see any scenarios with regards to that,” Norwegian Oil Minister Terje Riis-Johansen said less than two weeks ago.
Watch Video: OPEC Quota Remains Unchanged