OPEC opts to leave oil output unchanged knew this was coming
OPEC opts to leave oil output unchanged
CNN Money - [3/5/2008]
The Iraqi oil minister Hussain Al-Shahristani confirmed that OPEC will leave its production quotas unchanged at its latest output meeting here today.
The cartel, which excluding Iraqi output has a quota of 29.67 mln barrels of oil per day, took to the middle ground in an attempt to balance the conflicting forces of near-record prices and a combination of rising stockpiles and fears over falling demand.
The decision was in line with market expectations.
'As expected, the market has left things as they are,' said MF Global (NYSE:MF) analyst Ed Meir. 'It remains to be seen how prices will fare now the OPEC decision is out of the way.'
In the run-up to the meeting, ministers have expressed caution over the outlook for demand as the US economy continues to falter.
Economic weakness in the superpower, which consumes around a quarter of the world's oil output, could seriously affect global demand, especially if a slowdown in US growth spills over into the wider economy.
Ministers also claimed a lack of supply was not the reason for higher prices, blaming instead geopolitical factors, a shortage of refining capacity, weakness in the dollar and a rise in speculation in oil futures.
Prices eased back below 100 usd yesterday after hitting a record high of 103.95 usd, and have been trading around the century mark so far today.
Copyright Thomson Financial News Limited 2007. All rights reserved.
The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
