SHAFAQNA (Shia International News Association) – OPEC ministers are meeting in Vienna Thursday for a decision on whether to slash production, faced with a glut that has sent prices plunging by over 30 percent in five months. The 12-nation cartel is under pressure from its poorer members like Venezuela and Ecuador to cut output as collapsing prices have slashed their precious revenues.
But its powerful Persian Gulf countries have rejected calls to turn down the taps unless they are guaranteed market share in the highly competitive arena, particular in the United States, where a flood of oil being extracted domestically from shale rock has in part caused the global oversupply.
The price of US benchmark oil fell to a new four-year low Thursday on growing expectations that the Organization of Petroleum Exporting Countries will not take significant action in Vienna, home to the cartel that pumps out about a third of the world’s crude.
West Texas Intermediate for delivery in January fell to $72.61 a barrel – the lowest level since 2010. It later stood at $72.79 at about 0830 GMT, down 90 cents from Wednesday’s closing level. Crude prices have been depressed also by a strong dollar and worries about stalling energy demand in a weak global economy.
The International Energy Agency had warned in a report issued mid-November that the “price rout” was not over, and that prices will keep sliding well into 2015.