OPEC oil price slumps to near 25 dollars
(AFP, VIENNA) - The price of OPEC's reference basket of crude oil continued to fall on Monday, to $25.70, near the key $25 level set by the organisation as a "reasonable" long-term price, a spokesman said.
The new fall, the fourth daily drop in a row, follows an undertaking by OPEC last week that it would increase production by 500,000 barrels per day if the price remained persistently high, as it has done in recent months.
OPEC sources say no production increase is now expected, since member states have agreed a mechanism under which a production increase would be triggered only if the basket price remains above 28 dollars for 20 days.
Tuesday's price compared to $26.33 on Monday, Organization of Petroleum Exporting countries (OPEC) spokesman Fernando Garay said.
Oil prices had until last week remained near the $30 a barrel level despite a 700,000 barrel-a-day increase agreed in June.
OPEC heavyweight Saudi Arabia shook oil markets at the start of July by unilaterally announcing plans to produce 500,000 more barrels a day.
Last Monday OPEC President Ali Rodriguez said he had asked member states to prepare for a 500,000 barrel-a-day increase by the end of this month if prices did not fall.
OPEC Secretary-General Rilwanu Lukman confirmed at a June ministerial meeting in Vienna that 25 dollars per barrel was a "reasonable" price level in the long run.
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)