OPEC secretary-general says he expects production pact

by The Associated Press

The secretary-general of the Organization of Petroleum Exporting Countries said Dec. 11 he expects to reach a deal this week with non-OPEC nations to cut production by 500,000 barrels a day to help curtail sliding oil prices.

“They will just have to get to 500,000 barrels per day. ... Every nation has to decide on their own reduction,” Ali Rodriguez said told reporters in Venezuela’s Margarita Island before a summit of the Association of Caribbean States.

OPEC is seeking a deal in which 2 million barrels of crude per day are removed from the market beginning Jan. 1 to stabilize prices. Rodriguez, a former Venezuelan oil minister, said he expected a final deal with non-OPEC nations by the end of the week — but added that OPEC would reconsider its strategy if a deal falls through. He didn’t elaborate.

OPEC hopes to cut production by 1.5 million barrels per day on Jan. 1 if non-OPEC nations contribute a 500,000 barrels-per-day cut.

Rodriguez said he didn’t plan to meet with Mexican Oil Minister Ernesto Martens during the Margarita summit to encourage Mexico to make a bigger production cut. Martens has said Mexico, which doesn’t belong to OPEC, is sticking to plans to cut exports by 100,000 barrels a day in January.

Besides Mexico’s 100,000-barrel offer, Russia has offered a 150,000-barrel daily cut and Oman a 25,000-barrel cut. Norway has said it will reduce production by 100,000 to 200,000 barrels per day but has yet to release an official figure.

Oil prices have fallen more than 30 percent in recent months, hurt by a decline in demand. In trading Dec. 11, January crude oil futures were off 20 cents to $18.37 a barrel.