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Tuesday, September 09, 2008

WWOD (What Will OPEC Do?)

Here's the official line ...

Saudis imply OPEC will hold production steady
VIENNA, Austria - OPEC powerhouse Saudi Arabia suggested on Tuesday that a meeting of oil ministers of the 13-nation organization will decide to keep crude production steady, despite their concerns over rapidly falling prices.
With the Saudis accounting for about a third of the output of the Organization for Petroleum Exporting Countries, their views often are adopted by ministerial meetings deciding on whether to boost, keep steady, or cut oil production. Therefore, the comments by Oil Minister Ali Naimi suggested that the ministers would opt for the status quo

And here's what the whisper is ...

OPEC to cut real output by 500,000 bpd

VIENNA (AFP) - OPEC will agree to cut its real output by up to 500,000
barrels per day at its meeting on Tuesday while leaving its official production policy unchanged, energy consultancy PFC Energy said, citing unnamed sources. "PFC Energy has learned that OPEC has in principle agreed to trim production from current levels above official output targets," said the respected Washington-based group.
"PFC Energy understands that a cut in actual production could be in the order of 500 (thousand barrels per day), but that the communique text will likely focus on the need to abide by agreed-upon production targets rather than on numerical targets for cuts," it added.

What's my view? I think the Saudis will quietly ease back on production. They want higher prices, but they don't want a fuss from their "good friends" in America.


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