MercoPress. South Atlantic News Agency

Oil below 60 US dollars; OPEC ponders further cuts

While the price of crude oil for future delivery declined below 60 US dollars a barrel, OPEC sources on Tuesday said that the cartel will again consider cutting production when it meets next month in Algiers.

The barrel of oil levelled at 59.1 USD on the New York Mercantile Exchange after having touched 58.2 USD, the lowest since March 2007. Oil prices are down 60% since hitting an all time record high last July. "OPEC could make another cut of a million bpd because recession is cutting demand for crude", said a source close to the Organization of Petroleum Exporting Countries. OPEC is scheduled to meet on December 17 in Oran to assess the international oil market situation, Algerian Energy and Mining Minister Chakib Khalil said. Khelil, who is also the current OPEC President, said over the weekend that the Oran meeting would study the market's prospects for the first half of 2009 in view of the measures taken by the United States to arrest the economic crisis, which has spread to the rest of the world. However he also pointed out that it was useless for OPEC to decide on further output cuts if the October 24 decision to reduce its production by 1.5 million barrels per day (bpd) was not implemented by all the members. He also said that the creation of an OPEC-like cartel for gas exporting countries would depend on certain factors, mainly the setting up of an international gas market, which would be governed by the same rules as those prevailing in the oil market. The Gas Exporting Countries Forum's ministerial meeting that was scheduled for November 18 in Moscow, has been postponed, he said. The task force set up in 2002, under Russian chairmanship was in charge of preparing the organization's statutes and had to submit suggestions for the organization, he said. "It won't be a question of a heavy organization but a lighter one with a secretariat-general and a president," said Energy and Mining Minister Chakib Khalil.