Will OPEC cut oil production?
*Forbes, by Lionel Laurent, March 16, 2009
“The cartel decides against a production cut, leaving traders disappointed and oil prices down by around $2.00 per barrel.
The oil-exporting cartel OPEC burnished its credibility over the weekend by deciding not to cut production quotas, despite pressure from some members that would rather see oil prices in the region of $70-$80 per barrel than the current $40-$50 band. But traders were left disappointed on Monday, which took the wind out of some of crude oil’s gains made in the run-up to the cartel’s meeting.
Brent crude fell by $1.49, to $42.87 per barrel, during midday trading in Europe, while crude futures on the New York Mercantile Exchange sank by slightly less than $2.00, to $44.28 per barrel. Although OPEC’s 12 members gave mixed signals ahead of the meeting, with Kuwaiti and Iranian delegates saying the market was ‘oversupplied’ while Saudi sources reportedly took a more conservative line, analysts had expected the cartel to make a somewhat symbolic cut of around 500,000-1 million barrels per day.”
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