OPEC to cut production 1M barrels per day

OPEC has agreed to trim global oil production by 1 million barrels a day to boost prices, and its members were discussing how to share the cut, the cartel’s president said Oct. 11.

“The cut itself is agreed,” said Nigerian oil minister and OPEC president Edmund Daukoru.

Oil prices barely changed after his comments.

Daukoru told reporters after a Cabinet meeting in the Nigerian capital that the cuts would begin at the end of October and said members of the producing cartel were “nearing consensus” on how to share the cuts.

Daukoru’s comments followed a slew of reports attributed to anonymous sources from member countries who said the cartel plans to trim its daily production of 28 million barrels by 1 million barrels.

Some analysts had been skeptical that members of the Organization of Petroleum Exporting Countries were willing to voluntarily sell less oil right now — especially its largest producer, Saudi Arabia — given that prices are twice as high as they were three years ago even after a recent 25 percent decline.

OPEC is not scheduled to meet until December, though Daukoru had said earlier in October that the cartel was considering holding an emergency meeting before then to discuss what to do about falling prices.

The last time OPEC trimmed its output — by 1 million barrels a day — was December 2004 when oil traded slightly above $40 a barrel.

Oil prices have fallen sharply in recent weeks from their mid-July high of $78.40 on the New York Mercantile Exchange. By the afternoon of Oct. 11 in Europe, light, sweet crude for November delivery was up 2 cents to $58.54 a barrel and Brent crude was down 5 cents to $59.29 on the ICE Futures exchange in London.

—The Associated Press