Oil falls ahead of Opec meeting
Oil prices fell to a five-month low as traders anticipated that Opec would maintain its current production levels when it meets later in Vienna.
Opec believes it is pumping enough oil to satisfy demand
Comments by chief producer Saudi Arabia that the market was “fairly well-balanced” suggested that output would be unchanged.
Oil prices fell more than $2, with Brent crude at $101.27 and US light, sweet crude at $103.85.
Prices have sunk from a record of more than $147 a barrel seen in July.
Arriving for the meeting, the Venezuelan energy minister said he would support keeping production levels unchanged.
“We need to keep things as they are,” said Rafael Ramirez.
Earlier, the Saudi oil minister Ai al-Nuaimi said: “The market is fairly well balanced.”
“Inventories are in a healthy position, everything is in balance.”
OPEC members including Kuwait and the United Arab Emirates, have called for no change in output levels though Algeria, Iran, Venezuela and Libya have suggested a cut is needed – claiming the market is oversupplied.
Opec is currently thought to be producing about a million barrels per day (bpd) more than its official ceiling of 29.67 million bpd.
In May and June Saudi Arabia agreed to increase production by 500,000 bpd to help calm markets.
Opec produces about 40% of world crude.
In July, the exporters’ group said world demand for oil would grow by 50% between now and 2030 as people in developing countries drive more cars.
Interesting story. Note all of our natural enemies, working toward a CUT in production..