Oil price fall prompts Opec meeting

17/10/2008| IslamWeb

Opec (the Organization of Petroleum Exporting Countries) has brought forward an emergency meeting to discuss the effect of the global financial crisis on oil markets.

 

The organization announced the decision on Thursday, as oil prices plunged below $67 a barrel from a peak of $147 in July.

 

An Opec statement said: "Following consultations with the president of the Opec conference and colleague ministers, it has been decided to re-schedule the extraordinary meeting of the OPEC conference."

 

The meeting moves forward to October 24, from November 18.

 

Oil prices have fallen by more than 50 per cent from the record high of $147 per barrel, due mainly to fears of a global economic downturn.

 

Lawrence Eagles of JP Morgan said that Opec were looking for a price of at least $80 a barrel.

 

He said: "They are concerned that the momentum was going to pull it down to $60 ... At around $60, it starts to impact the Saudis' budget."

 

Manipulation

 

Controlling supply would provide price manipulation. Abdullah al-Attiyah, Qatar's oil minister, told Al Jazeera that he expected Opec to cut oil production by one million barrels per day or more at next week's meeting.

 

He said that the meeting was brought forward so that "we can take action before solutions become more difficult ... Prices have plunged in a very big way."

 

Opec did not give further details on why the meeting had been moved, but the body said last week that it would hold the meeting to "discuss the global financial crisis, the world economic situation and the impacts on the oil market".

 

They said: "The subprime mortgage problems that have been observed for a long time have created a shock wave in financial institutions resulting in huge losses, and an escalating credit squeeze which has turned into a deep financial crisis."

 

The price of oil continued to fall on Thursday, with Brent crude closing lower on $67 a barrel, its lowest level for more than 15 months.

 

Traders said the drop was due to lowering energy demands.

 

PHOTO CAPTION

 

Security officers overlook a street from a rooftop of the OPEC headquarters in Vienna.

 

Al-Jazeera