Oil cut of 1.5-2.0 mbd should keep prices stable
OPEC is set to agree a production cut of 1.5-2.0 million barrels per day, which should keep crude oil prices stable at their current levels, the cartel's president Chakib Khelil said Tuesday.
But speaking ahead of a Wednesday ministerial meeting of the Organization of Petroleum Exporting Countries (OPEC), he said the decision on exactly how much would be a "tough" one.
"I cannot tell you about consensus but I can tell about the range, 1.5 to 2.0" million barrels per day," he told reporters in Vienna, adding: "It's going to be a big tough discussion."
Referring to current price levels which are within the 11-member cartel's $22-28 a barrel target range, he said: "The market is satisfied now . "My feeling is personally that we are not going to see changes in the prices."
Wednesday's meeting is widely expected to agree a cut of around 1.5 million barrels per day, although some hawkish OPEC members are calling for more.
Khelil reiterated that the organization wants to avoid a price collapse like that which happened in 1998, during the Asian financial crisis, when crude prices slumped to below $10 a barrel.
"We're taking this decision in order (to avoid) the situation of 1998, when we had a collapse," said Khelil, Algeria's oil minister, who took over the OPEC presidency on January 1.
Meanwhile Khelil forecast that the OPEC production cut will be implemented in one go, rather than phased. OPEC sources have talked about the move being agreed from February 1.—AFP.
©--Agence France Presse.
© 2001 Mena Report (www.menareport.com)