OPEC Production Seen at 30 Million Barrels
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OPEC is expected to keep its production ceiling at 30 million barrels a day, as comments from Ministers from Ecuador, Kuwait and Nigeria make it clear that they are not interested in cutting output levels. Early in the week, some analysts thought they would cut output due to falling prices, but that prospect now appears dim. Also dimming is the prospect that they will raise production, as some have suggested.
"In the present environment, raising the target would send out the wrong signal, as it would suggest that OPEC is not willing to step down the overproduction," Eugen Weinberg, head of commodity research at Commerzbank AG in Frankfurt, said in a
note yesterday. "This would risk a continued oversupply and a further drop in prices."
OPEC is pumping currently pumping 1.58 million barrels a day more than its target as Saudi Arabia boosted production to 9.92 million barrels a day in May from 9.88 million barrels the previous month, according to OPEC estimates.
United States Oil (NYSE: USO) is trading flat ahead of the official OPEC statement to be released later today.
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"In the present environment, raising the target would send out the wrong signal, as it would suggest that OPEC is not willing to step down the overproduction," Eugen Weinberg, head of commodity research at Commerzbank AG in Frankfurt, said in a
note yesterday. "This would risk a continued oversupply and a further drop in prices."
OPEC is pumping currently pumping 1.58 million barrels a day more than its target as Saudi Arabia boosted production to 9.92 million barrels a day in May from 9.88 million barrels the previous month, according to OPEC estimates.
United States Oil (NYSE: USO) is trading flat ahead of the official OPEC statement to be released later today.
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