OPEC is unlikely to reduce production
Cartel sees oil at $60 barrel as just right
VIENNA -- OPEC, the producer of 41 percent of the world's oil, probably won't cut output at a meeting here this week as mounting tensions between the United States and Iran bolster prices.
The Organization of Petroleum Exporting Countries, whose members will meet tomorrow, lowered production at its two previous conferences. Oil ministers from Kuwait, Iran, Qatar, Algeria, Libya, and Indonesia said in the past month more cuts aren't needed after crude traded close to $60 a barrel for the past five weeks, reaching its highest in more than two months March 1.
"Prices are right about where OPEC wants them to be, so they will take no action," said Peter Beutel, president of Cameron Hanover, a New Canaan, Conn., energy consultant. "Oil at $50 is too low for most of the members and $70 is seen as too high to be sustainable."
The United States is at odds with Iran, the second-biggest producer in OPEC, over its nuclear research. Iran says it wants to generate power. America says Iran wants to build weapons.
OPEC agreed to reduce supplies at its two previous meetings by a combined 1.7 million barrels a day to compensate for expected seasonal decline in heating fuel demand next quarter. Crude oil for April delivery fell 98 cents, or 1.7 percent, to settle at $57.93 a barrel on the New York Mercantile Exchange.
Kuwaiti Oil Minister Sheikh Ali-Jarrah al-Sabah and Libya's top oil official, Shokri Ghanem, said yesterday that OPEC doesn't need to make any cuts.
