Friday, October 10, 2008
From an article titled "Behind OPEC's Novembr Meeting in Vienna" by Stanley Reed of Business Week as posted in the daily news of October 10 by the Association for the Study of Peak Oil & GAS – USA (ASPO-USA):
As the global economy cools precipitously, the oil producers are anxious to curb output to keep prices from falling further
Less than three weeks after an acrimonious Ramadan meeting in Vienna, OPEC has now called an emergency meeting for Nov. 18 in the Austrian capital. The reason is clear: The cartel is worried about the precipitous 40% fall in oil prices since they peaked at $147 per barrel in mid-July. The OPEC basket, a blend of OPEC crudes, dropped through the psychologically important $80-per-barrel level, to $77.38, on Oct. 9. OPEC countries typically receive less for their crude than the widely reported West Texas Intermediate (U.S.) crude, which is now trading at about $87 per barrel. "The organization is concerned about the deteriorating economic conditions with contagion risks," OPEC said in calling for the rushed confab. . . .
David Kirsch, an analyst at PFC Energy, a Washington consultant firm, thinks that with demand falling, OPEC is entering a phase of much more active management of the oil markets, including more frequent meetings. He says it's uncertain at this point whether there will be a production cut announced at the November emergency meeting, but with demand dropping off, OPEC "will not want to wait too long to cut, and they would probably rather meet and decide action isn't necessary than wait too long to do something."