OPEC president says production cut likely if prices slide in January

CARACAS, Venezuela - OPEC members likely will cut production in January if world oil prices keep dropping, the cartel's president said Thursday.

''If the oversupply in the market were to be sustained, oil prices would fall and the Venezuelan economy would be affected,'' Ali Rodriguez, who also is Venezuela's oil minister, said in a televised broadcast. ''For that reason, there will probably be a cut in production in January.''

Rodriguez said the Organization of Petroleum Exporting Countries' oil price benchmark, at $26 a barrel, is approaching the lower limit of a so-called OPEC ''price band'' intended to keep prices between $22 and $28 per barrel. OPEC has agreed to cut production by 500,000 barrels a day if prices stay below $22 per barrel for 10 consecutive days.

The price of oil had topped $30 a barrel in September, but increased OPEC production, more non-OPEC production and a mild European winter have moderated oil prices in recent weeks.

Rodriguez responded to President-elect Bush's call for an OPEC production increase by noting that the cartel has already raised output by about 4 million barrels per day this year.

Venezuela's deputy oil minister, Bernardo Alvarez, told Dow Jones Newswires, however, that there is no consensus among OPEC members to cut production during a Jan. 17 meeting of oil ministers in Vienna. Members Iran and Kuwait are urging a cut of 1 million barrels per day.

Comments

Use the comment form below to begin a discussion about this content.

Sign in to comment