OPEC, allies determine to implement price-boosting production cuts

OPEC, the 15-member oil cartel meets today and resolute on implementing price-boosting production cuts to deal with 30 percent crash in oil price in the last two months, which has scaled up pressure on budgets of oil-exporting countries.

The much-anticipated meeting comes at a time when the oil market is near the bottom of its worst price plunge since the 2008 financial crisis.

The Organisation Petroleum Exporting Countries’ kingpin Saudi Arabia has been leading calls for the group to trim output, amid surging supply and fears that an economic slowdown will erode fuel demand. The oil-rich kingdom has previously indicated it wants the group to curb output by at least 1.3 million barrels per day.

Meanwhile, President Donald Trump has been mounting pressure on the oil cartel to bring down oil prices.

“Hopefully OPEC will be keeping oil flows as is, not restricted. The World does not want to see, or need, higher oil prices!” Trump tweeted Dec. 5.

CNBC reported that Khalid al-Falih, Saudi Arabia’s Energy Minister told reporters Thursday morning that an output cut of 1 million barrels per day would be sufficient for OPEC and its allied producers. This prompted international benchmark Brent crude and U.S. West Texas Intermediate (WTI) to fall more than 4 percent, as energy market participants feared the energy alliance would only manage to impose measures at the bottom end of expectations.

Brent was trading at $59.75 a barrel at around 12:35 a.m. London time, while WTI stood at $51.07.

Russia has appeared reluctant to sign off on a reversal in production strategy. The non-OPEC heavyweight has warned the energy alliance must tread carefully this week to ensure it does not change course by 180 degrees whenever it meets.