OPEC set for output cut from November 1
20 Oct 2006
Mumbai: The Organisation of Petroleum Exporting Countries (OPEC) will reduce the group's oil output by 1.2 million barrels per day (bpd) to 26.3 million bpd from November 1in a bid to check falling global oil prices.
The group had earlier planned to lower output by one million tonnes. This is the first time that the group announced production curbs since April 2004.
The meeting of the OPEC ministers, held under the chairmanship of UAE energy minister Mohammed bin Dhaen Al Hameli, also decided to review the decision at the group's next meeting scheduled for December 14, in Nigeria.
OPEC's immediate concern is the level of production and not prices as such, and top on the agenda is a cut in actual production levels, said Qatar's second deputy prime minister and minister of energy and industry Abdullah bin Hamad Al Attiyah.
The producer group has wider support for the current cuts with major producer Saudi Arabia ready to shoulder a third of the reduction as OPEC bids to shore up sagging prices.
The news set oil prices climbing briefly above $59 a barrel. North Sea oil rose 39 cents to $61.26 a barrel in early morning trade.
OPEC
accounts for about a third of the world's crude, and
more cuts
may be made in December. The production cut also prompted
oil traders, faced with shorter supplies, to send oil
prices up. Oil prices, however, are well below the record
high of $75 a barrel set in August.
