| Author |
Message |
Theresa
Lux Mihi Deus
Joined: 17 Jun 2001
Posts: 27256
Location: United States of America
|
 Wed Mar 31, 2004 10:37 pm OPEC to Cut Oil Production by Four Percent |
|
| Quote: | VIENNA, Austria (March 31) - With fuel costs already at uncomfortable levels for consumers, OPEC took a step that could push prices even higher by announcing Wednesday that it would cut its crude oil production target by 4 percent.
The Organization of Petroleum Exporting Countries hopes the cut, which takes effect Thursday, will prevent a slide in prices this spring, when the global demand for oil usually slips to a seasonal low.
Some analysts said the cut could soon push crude prices above the psychologically important threshold of $40 per barrel. The decision could also worsen the pain for U.S. motorists, who have been paying the highest prices in recent years for gasoline.
OPEC, which pumps about a third of the world's oil, agreed in talks at its headquarters in Vienna to reduce its output target by 1 million barrels per day. Although it had announced plans for the cut when its members met last month in Algiers, Algeria, a subsequent surge in prices led a few of the group's 11 members to suggest postponing the decrease.
OPEC had to balance concerns that high prices could choke off economic growth with its own fears that swelling inventories and a seasonal lull in springtime demand could reduce cause prices to plunge.
Kuwait and the United Arab Emirates proposed postponing the cut, but Saudi Arabian Oil Minister Ali Naimi and the majority of ministers prevailed in their effort to press ahead and reduce the ceiling to 23.5 million barrels per day.
These ministers blamed speculators for much of the froth in prices and argued that the weak U.S. dollar was adding to the problem. Oil is bought and sold in dollars, and the recent decline in the dollar's value has caused the nominal price for oil to increase.
''Notwithstanding the prevailing high prices, crude markets remain more than well supplied,'' OPEC President Purnomo Yusgiantoro told reporters.
Futures markets, which rose sharply Tuesday on signals that OPEC would lower its output ceiling, responded to the official announcement with a sell-off as traders liquidated their long contracts and took profits. Carl Larry, an analyst at ABN Amro in New York, said this reaction proved that OPEC was at least partly correct in attributing some of the high crude prices to ''speculative money.''
U.S. crude futures for May delivery fell 49 cents to $35.76 per barrel in New York, while May contracts of North Sea Brent settled 77 cents lower at $31.51 in London.
However, some analysts argued that prices would soon begin to rise again, especially if OPEC showed that it was determined to curtail its actual output and not just reduce its production target. U.S. crude could spike to $40 a barrel ''within a week or two,'' Larry said.
U.S. gasoline prices would stay high and might rise even higher, said Kevin Norrish, head of commodities research at Barclays Capital in London. The main problem wasn't expensive crude so much as limited refinery capacity. ''They're not able to process the crude oil into gasoline quickly enough,'' he said.
Gasoline prices climbed to a nominal record average of $1.80 a gallon nationwide, according to the latest Lundberg survey of 8,000 stations across the United States. But that was still below the inflation-adjusted record set in March 1981, Lundberg said. The March 1981 combined average for all grades was about $1.38, the equivalent of $2.85 in today's dollars.
Costlier crude would have a ''much more muted'' effect on gasoline prices in Europe, where taxes account for the bulk of the pump price in some countries, Norrish said.
Over the longer term, the expected drop in demand during the April-June quarter and quota-busting by individual OPEC members should help push prices gradually lower, analysts said.
Most OPEC members are taking advantage of the current high prices by pumping as much oil as they can. Excluding Iraq, which doesn't participate in the group's quota agreements, OPEC is already exceeding its existing target by an estimated 1.5 million barrels.
Although he foresees a short-term rise to $40 per barrel, Leo Drollas of the London-based Center for Global Energy Studies said he believed that prices would eventually fall to around $28.50 in the second quarter because producers would continue pumping oil in excess of their quotas.
John Waterlow of Wood Mackenzie Consultants in Edinburgh, Scotland, said prices would probably remain high for several weeks but could fall to $28 or less during the summer.
In the United States, high oil and gasoline prices have become an issue in the presidential campaign.
Democratic contender Sen. John Kerry said that as president he would stop pumping oil into the nation's emergency stockpile until prices fell and would pressure OPEC to provide more oil. A White House spokesman said President Bush was disappointed by OPEC's decision.
---
AP Business Writer Bruce Stanley in London contributed to this story.
AP-NY-03-31-04 17:51EST
Copyright 2004 The Associated Press.
|
Ok, blame President Bush. Remember, creativity counts.
F*in OPEC.
-------signature-------
Some of us fall by the wayside
And some of us soar to the stars
And some of us sail through our troubles
And some have to live with our scars
|
|
|
Republican_Man
STV's Premier Conservative
Joined: 26 Mar 2004
Posts: 14823
Location: Classified
|
| Fri Apr 02, 2004 11:28 pm |
|
| Quote: | | Ok, blame President Bush. Remember, creativity counts. |
Too FUNNY! 
That's all the Liberals do! "It's all Bush's fault..." You get it...
-------signature-------
"Rights are only as good as the willingness of some to exercise responsibility for those rights- Fmr. Colorado Senate Pres. John Andrews
|
|
|
Puck
The Texan
Joined: 05 Jan 2004
Posts: 5596
|
| Sat Apr 03, 2004 12:01 am |
|
Something seriously needs to be done about OPEC....and the American people need to take this onto themselves. There is technology to use other renewable fuels...but someone is to lazy to actually develope it. What Bush should have done after 9-11, when the country was rallied behind him and asked that we make the sacrifice of buying more fuel effiecient vehicles, and made incentives for those who did. I am kinda tired right now.....otherwise I would expand on this.
|
|
|
Theresa
Lux Mihi Deus
Joined: 17 Jun 2001
Posts: 27256
Location: United States of America
|
| Sat Apr 03, 2004 12:08 am |
|
^Remember the hydrogen car?
-------signature-------
Some of us fall by the wayside
And some of us soar to the stars
And some of us sail through our troubles
And some have to live with our scars
|
|
|
Puck
The Texan
Joined: 05 Jan 2004
Posts: 5596
|
| Sat Apr 03, 2004 12:14 am |
|
exactly...if we are considering ways to transport people to mars, I am sure that we have the technology to find a better, cleaner, and cheaper way to transport people to the grocery store
|
|
|
Monkey
Captain
Joined: 05 Feb 2004
Posts: 833
Location: On a quest you probably wouldn't believe.
|
| Sat Apr 03, 2004 4:06 am |
|
i don't get why there even going to mars, it's just a waste of money that could be spent on world hunger or something like that
Last edited by Monkey on Thu Apr 08, 2004 5:05 am; edited 1 time in total
-------signature-------
"Maybe I should get myself fired."
Millennium Actress
|
|
|
imzadi76
Commander
Joined: 15 Jan 2004
Posts: 367
Location: Pittsburgh - PA - USA - Earth - Sector001 - Alpha Quadrant
|
| Sat Apr 03, 2004 1:42 pm |
|
Oh yeah, Hydrogen is a great, cheap enviromentally sound fuel source.
....just ask anybody that was on the Hindenberg!
-------signature-------
Live long and prosper
|
|
|
Link, the Hero of Time
Vice Admiral
Joined: 15 Sep 2001
Posts: 5581
Location: Kokori Forest, Hyrule
|
| Sat Apr 03, 2004 4:17 pm |
|
I think Robin Williams put it best.
"Offer Saudi Arabia and other oil producing countries $10 a barrel for their oil. If they don't like it, we go some place else. They can go somewhere else to sell their production. (About a week of the wells filling up the storage sites would be enough.)"
-------signature-------
"Dissent is the highest form of patriotism." President Thomas Jefferson
"A man's respect for law and order exists in precise relationship to the size of his paycheck." Adam Clayton Powell Jr.
|
|
|
|
|
You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum
|
Powered by phpBB © 2001, 2002 phpBB Group
Star Trek �, in all its various forms, are trademarks & copyrights of Paramount Pictures
This site has no official connection with Star Trek or Paramount Pictures
Site content/Site design elements owned by Morphy and is meant to only be an archive/Tribute to STV.com
|
Search
FAQ
Log in
