Wednesday, December 17, 2008

OPEC will slash supply by a record 2 million barrels

The JSE in South Africa is current 22319 (2%) up and oil prices are at $46.97. It will be interesting to see how these and international indices change as these cuts are implemented. I'd guess that initially there would be very little change, and then later, the effects would be quite sudden and quite large.
clipped from
OPEC agrees to cut of two million oil barrels

ORAN, Algeria – OPEC powerhouse Saudi Arabia said Wednesday the group will slash a record 2 million barrels from its daily production as of Jan. 1, while Russia and other OPEC outsiders announced their own cutbacks of hundreds of thousands of barrels from the market.

Saudi oil minister Ali Naimi said there was a consensus within OPEC ahead of a formal agreement later in the day for the move — which would represent the largest single OPEC cut ever.

Saudi Oil Minister Ali Naimi arrives at the OPEC meeting in Oran, western

Still, while eager to push prices higher, OPEC must weigh production cuts against the risk of driving the economies of its top customers deeper into recession.

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