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December 9, 2004 02:32 PM

OPEC Considers Output Cut to Keep Prices From Falling


Excerpt: After producing close to full capacity for several months in a bid to drive crude oil prices down from record levels, OPEC ministers are considering curbing their production and taking some oil off the market to prevent a slump in prices as demand slows next year.


After producing close to full capacity for several months in a bid to drive crude oil prices down from record levels, OPEC ministers are considering curbing their production and taking some oil off the market to prevent a slump in prices as demand slows next year.

While oil prices in New York are still up 30 percent this year, they have dropped by nearly a quarter since they touched over $55 a barrel in late October. Today, crude oil for January delivery rose 59 cents to settle at $42.53 a barrel on the New York Mercantile Exchange as oil traders reacted to a possible production cut from OPEC.

Discussions about tightening production have gained momentum among oil ministers from the Organization of Petroleum Exporting Countries, which meets Friday in Cairo. OPEC is now producing at its highest rate in 25 years to meet this year's record demand for oil. But as consumption growth is expected to slow down next year, OPEC is seeking to prevent an oversupply of oil in the market as well as anticipate a further seasonal decline in the second quarter.

"I think the price decline was expected but the speed of the decline was a surprise," said Mohamed bin Dhaen al-Hamli, the oil minister from the United Arab Emirates.

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U.S. Quiet on China Trade Tax (December 17, 2004)
China's promise to impose new taxes on some textile exports will do little to sway the administration as it debates whether to limit the expected flood of Chinese goods next year, trade groups on both sides of the argument said yesterday. The European Union, however ...
Fed Raises Interest Rates for 5th Time This Year (December 17, 2004)
The Federal Reserve raised short-term interest rates today for the fifth time this year, and it suggested that more rate increases are in order in the months ahead. As widely expected, the central bank raised the federal funds rate on overnight loans by a quarter-point ...
A Plan For U.S. Energy Security? (December 08, 2004)
The United States must diversify its global oil supplies, expand a world network of strategic petroleum reserves and raise fuel efficiency standards to ensure its energy security, a panel of experts will recommend Wednesday. These are some of the findings from the National Commission on ...
Fed Heading For A Pause (December 07, 2004)
No, not next week, but maybe in February the Federal Reserve will decide to pause and hold interest rates steady. The statement will tell the tale. While the economy continues to expand, it's doing so unevenly. For every strong statistic that's released nowadays, there's one ...

Read all 21 posts in the same category of Economy:

U.S. Quiet on China Trade Tax - Dec 17, 2004
Fed Raises Interest Rates for 5th Time This Year - Dec 17, 2004
A Plan For U.S. Energy Security? - Dec 08, 2004
Fed Heading For A Pause - Dec 07, 2004
Social Security Reform = New Debt - Dec 06, 2004
Fed Sees Growth, Measured Rate Hikes - Dec 05, 2004
Weak Employment Rport Casts Doubts Over US Economic Strength - Dec 05, 2004
Fed: Inflation Not Setting Off Alarms - Dec 05, 2004
Balancing Act On The Buck - Dec 04, 2004
Job Growth Is Well Below Wall Street Forecasts - Dec 03, 2004
Fed Reports Growth In 11 Of 12 Regions - Dec 02, 2004
Inflation Under Control, Fed Gov. Says - Dec 02, 2004
Global Forecasts for 2005 Growth Are Reduced - Nov 30, 2004
Borrowing For Social Security Plan? - Nov 28, 2004
No Longer Top Dollar? - Nov 26, 2004
Don't Worry ... Don't Be Happy - Nov 26, 2004
Is Another Recession Brewing? - Nov 25, 2004
Inflation Is Tame, Right? - Nov 24, 2004
The Dollar Is Down, But Should Anyone Care? - Nov 21, 2004
Bush Sets Plans To Revamp Taxes, Social Security - Nov 04, 2004