OPEC deciding to cut Oil output on over supply concerns

October 22, 2008 by · Leave a Comment
Filed under: Commodities News 

Hopefully they will not cut too much so that oil gets priced well over $100 a barrel.   With our severe economic crisis that is unfolding, it would be devastating if oil prices spiked up again and stayed there.  I do believe oil is quite cheap at this moment and once this crisis passes we will see the price rise and hopefully that will be after we re-establish our new growth pattern.


A deep price slump, depleted oil demand and swollen stocks have heaped pressure on OPEC ministers to cut supplies at their meeting this week, but they also need to prevent further damage to a battered world economy.


The Organization of the Petroleum Exporting Countries gathers on Friday in Vienna at an emergency session originally set for November 18.


It announced last week when oil fell below $70 a barrel it would bring the meeting forward. U.S. crude on Wednesday dropped further to below $67, its weakest since June last year.


“The question of reduction has to be discussed at the conference,” OPEC’s President Chakib Khelil of Algeria said on his arrival in Vienna.


He also said OPEC should avoid harming countries hurt by the financial crisis and those would include some within the producer group unless it acted decisively enough.


“If the decision goes too far, it will affect countries who are already affected by economic crisis,” he said. “If it doesn’t go too far, then it will affect the producers who might end up in the category of people affected by financial crisis.”

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