OPEC Recommends No Production Cuts
Source: Associated Press, Tarek El-Tablawy (9/9/09)
"Prices are now roughly double their levels from December. . ."
Instead, the focus at the organization's meeting in Vienna was to be on persuading members not to sell more oil than their quotas permit.
Kuwait's oil minister, Sheik Ahmed Al Abdullah Al Sabah, said OPEC's markets monitoring committee would suggest to the 12-country group that oil output targets be held steady at the organization's meeting Wednesday in Vienna. The gathering is being held in the evening as it falls during the holy month of Ramadan when Muslims must fast from dawn to dusk.
The recommendation offers further indication that ministers from the bloc—supplier of roughly 35% of the world's crude—are turning their aim toward encouraging member discipline. Compliance with the output limits, which are designed to support prices, has been waning.
Prices are now roughly double their levels from December, when the Organization of Petroleum Exporting Countries announced its record 4.2 million barrel per day cuts from September 2008 levels. The price rally has been welcome news for cash-hungry member governments, but also a temptation to sell more oil.