OPEC ministers could make their deepest oil supply cut ever when they meet on Wednesday to combat shrinking demand, bulging stocks and a $100 collapse in prices.
By Barbara Lewis and William Maclean
For many in the Organization of the Petroleum Exporting Countries, up to 2 million barrels per day (bpd) must be removed to keep up with a slump in consumption that has knocked two-thirds off prices since July.
“We have to act — we see a very sizeable reduction,” OPEC Secretary-General Abdullah al-Badri told reporters on his arrival on Monday in this western Algerian city.
OPEC President Chakib Khelil agreed.
“Everybody is supporting a cut — I don’t have any doubt about it.”
Oil rigs extract petroleum in the Los Angeles area community of Culver City, California. World oil prices have rebounded on expectations that crude exporters’ cartel OPEC will cut production at a key meeting in Algeria this week, dealers said.(AFP/Getty Images/File/David McNew)
Benchmark U.S. crude rose more than $2 a barrel toward $49 in early trade — still far from the “fair” price of $75 a barrel identified by Saudi Arabia, the world’s biggest crude exporter, at the end of November.
After slashing a combined two million barrels daily, 7.3 percent of its output at two previous meetings, OPEC was on course to chop at least another five percent off a world market that burns 86 million barrels of oil each day.
Saudi Arabia, had yet to make public comment on its position, but OPEC chief Khelil said Riyadh had already cut back in anticipation of further supply curbs.
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