OPEC appears ready to announce one million bpd cut in Doha meeting

In order to halt a precipitous fall in prices at the world oil market, the Organization of Petroleum Exporting Countries (OPEC) appeared ready Thursday to announce a one million barrel per day cut to the cartel's oil production, the first since 2004.

The assessment was made while OPEC ministers are gathering in the Qatari capital of Doha for their extraordinary meeting due to begin on Thursday evening.

Upon his arrival in Doha earlier on Thursday, Saudi Oil Minister Ali al-Nuaimi said OPEC would cut one million barrels per day from its current production, which is below its official quota of 28 million barrels per day (bpd).

He expressed his kingdom's full support for the planned reduction and suggesting a further cut of 500,000 bpd could follow when OPEC meets in Nigeria in December, according to reports reaching here from Doha.

"For now we believe a million barrels from actual production will be meaningful and we have plenty of time to discuss additional cuts when we meet in Abuja," al-Nuaimi was quoted as saying.

Meanwhile, Venezuelan Energy Minister Rafael Ramirez said he believed OPEC was in agreement to cut one million bpd to check the slide in global prices, though the OPEC members have yet to decide whether the cut would be based on official quotas or actual production.

One day earlier, Algerian Oil Minister Chakib Khelil also said such a reduction was a "done deal".

Analysts said that OPEC appeared ready Thursday to announce a one million barrel per day cut but remained divided on how the reduction would be executed.

A cut to actual production would likely send oil prices higher, while a cut to the official quota could see them fall because OPEC lacks credibility by already producing under official targets, they added.

Source: Xinhua