The Organization of Petroleum Exporting Countries (OPEC) agreed Wednesday to cut oil production, ministers said, in a surprise move aimed at boosting persistently weak crude prices.<\/p>\n
The news triggered an immediate spike of more than 5 percent in crude prices, as markets had expected the Algiers meeting to end without agreement.<\/p>\n
In London benchmark Brent North Sea crude for November delivery rose $2.72 to $48.69, while in New York a barrel of West Texas Intermediate (WTI) was up $2.38 to $47.05.<\/p>\n
OPEC members, whose countries produce 40 percent of the world’s crude oil, had agreed to cut their output by 750,000 barrels a day to 32.5 million barrels per day (bpd), according to Bloomberg News, while ministers gave a slightly more nuanced figure.<\/p>\n
“We have an agreement between 32.5 to 33 million bpd,” Nigerian oil minister Emmanuel Ibe Kachikwu said shortly afterwards. His Qatari counterpart confirmed the figure.<\/p>\n
“The meeting was conducted under a very positive atmosphere reflecting strong coherence of OPEC,” said Qatari energy minister Mohammed bin Saleh al-Sada.<\/p>\n
The informal OPEC meeting opened earlier Wednesday to discuss a possible freeze in output by the cartel, with the aim of raising prices which have fallen by more than half since mid-2014.<\/p>\n
The surprise output move came after Algerian Energy Minister Noureddine Boutarfa pressed demands for action on an oil supply glut and higher investment to stabilise the market.<\/p>\n
“We must act on supply to re-stabilise the market” which has been hit by a massive surplus that has dragged prices down to record lows in the past two years, Boutarfa told a news conference.<\/p>\n
According to the International Energy Agency, last year saw a 25 percent fall in investment in oil and gas exploration and production and the agency says the decline is continuing apace.<\/p>\n
OPEC discord<\/strong><\/p>\n Amid record output, there is discord among the 14-nation cartel whose share of global crude supply is around 40 percent.<\/p>\n Progress is hampered notably by disagreements between Saudi Arabia and Iran, the latter back on stream as a producer after the recent lifting of a range of energy-related sanctions.<\/p>\n OPEC kingpin Saudi Arabia has so far refused to curb its output at a time when Iran is ramping up production following the lifting of nuclear-related sanctions.<\/p>\n Iranian Oil Minister Bijan Zanganeh said Tuesday on the eve of the Algiers meeting that the Islamic republic was not yet ready to join a mooted production freeze.<\/p>\n Zanganeh said Iran wanted to increase its daily output to pre-sanctions levels of four million barrels, from the current estimated level of up to 3.8 million.<\/p>\n Saudi Arabia and Iran, the Middle East’s foremost Shiite and Sunni Muslim powers, are at odds over an array of issues including the wars in Syria and Yemen.<\/p>\n But there were some tentative signs of a narrowing of differences in Algiers, where major non-OPEC producer Russia also joined the talks on Wednesday.<\/p>\n Saudi Oil Minister Khaled al-Faleh said Tuesday he was optimistic that ministers would find some common ground.<\/p>\n A previous bid to freeze output fell apart in Doha in April as Iran refused to take part, saying it needed to return output to pre-sanctions levels.<\/p>\n Further complicating the negotiations, Libya and Nigeria have also been reluctant to limit production after conflicts that have curbed their output.<\/p>\n Prices plunged from peaks of more than $100 a barrel in mid-2014 to near 13-year lows below $30 in January, before recovering some of the losses.<\/p>\n (AFP)<\/em><\/p>\n (http:\/\/www.france24.com\/en\/20160929-oil-price-surge-opec-agrees-surprise-output-cut-production)<\/p>\n","protected":false},"excerpt":{"rendered":" The Organization of Petroleum Exporting Countries (OPEC) agreed Wednesday to cut oil production, ministers said, in a surprise move aimed at boosting persistently weak crude prices. The news triggered an immediate spike of more than 5 percent in crude prices, as markets had expected the Algiers meeting to end without agreement. In London benchmark Brent North Sea crude for November… Read more »<\/a><\/p>\n","protected":false},"author":19,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-181","post","type-post","status-publish","format-standard","hentry","category-article-post"],"_links":{"self":[{"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/posts\/181","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/users\/19"}],"replies":[{"embeddable":true,"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/comments?post=181"}],"version-history":[{"count":1,"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/posts\/181\/revisions"}],"predecessor-version":[{"id":183,"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/posts\/181\/revisions\/183"}],"wp:attachment":[{"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/media?parent=181"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/categories?post=181"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/baileyonlineclassroom.com\/southandcentralasiablog\/wp-json\/wp\/v2\/tags?post=181"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}