Oil Cartel OPEC to cut production pushes up oil price

Posted by admin on 18 October, 2008 under Business news | Be the First to Comment

The end of the week saw the price of oil at just $71.75 per barrel having dipped below $70 earlier in the week.

The price has risen towards the end of the week on the back of OPEC bringing forward its emergency meeting by three weeks to next week. Analysts are expecting the cartel to cut output at this meeting, which would boost prices.

It is dificult to say where the price will go after this – will the world slow down keep a downward pressure on the oil price depsite the reduced output or will the price stabalize now.

Good news on the oil reserves though from Cuba, where they are claiming to have 20 billion barrels in of-shore fields, which is twce their original estimates. If the estimates of these reserves is correct, Cuba’s oil reserves would be nearly as much as the reserves in the US, which is around 21 billion barrels.

You can see the worlds oil reserves here

It seems crazy that only in June of 2007 the Independent reported:

“In recent years the once-considerable gap between demand and supply has narrowed. Last year that gap all but disappeared. The consequences of a shortfall would be immense. If consumption begins to exceed production by even the smallest amount, the price of oil could soar above $100 a barrel. A global recession would follow.”