OPEC announced a cut of 520,000 barrels per day to its output yesterday, citing downside risks to the oil market as prices fell below US$100 for the first time since April.
After a marathon meeting that finished at about 3am, late even by OPEC standards, the president of the organization said its members had agreed to begin reducing production immediately.
“If you do your own calculations, it is a cut of 520,000 barrels per day,” OPEC president and Algerian Energy Minister Chakib Khelil said, announcing a new OPEC output quota of 28.8 million barrels per day excluding Indonesia — which officially left OPEC yesterday — and Iraq.
The cut, which immediately boosted sliding oil prices, was likely to dismay consumers hoping for bigger falls.
US Energy Secretary Samuel Bodman had asked producers on Tuesday to keep oil markets well supplied.
“The United States can order its companies [around] but not OPEC,” said OPEC Secretary General Abdullah al-Badri in response to a question about possible concerns in Washington about the announcement.
Oil sank below US$100 for the first time in five months in London on Tuesday when Brent North Sea crude for delivery in October dropped to US$99.04 in late European trade.
But prices rebounded in Asian trade. New York’s main contract, light sweet crude for delivery next month rose US$0.92 to US$104.18 a barrel while Brent North Sea crude rose US$0.65 to US$101.07.
Analysts had suggested OPEC would keep its official policy unchanged but would discreetly agree to rein in production by cracking down on output by some members that are pumping above their quota.
The candor of the final announcement was a surprise.
Khelil said he did not expect the OPEC decision to reverse the downward trend of oil prices, which peaked at US$147 a barrel in July.
“My hunch is probably the price still will be going down despite the decision that we made,” he said.
“I don’t think this will affect the consumers in any way because first of all, there’s an oversupply. Everybody agrees on that,” he said.
OPEC also announced that Indonesia had formalized its departure from the group after it became a net importer of crude oil.
“The conference regretfully accepted the wish of Indonesia to suspend its full membership in the organization,” OPEC said in a statement.
NO HUMAN ERROR: After the incident, the Coast Guard Administration said it would obtain uncrewed aerial vehicles and vessels to boost its detection capacity Authorities would improve border control to prevent unlawful entry into Taiwan’s waters and safeguard national security, the Mainland Affairs Council (MAC) said yesterday after a Chinese man reached the nation’s coast on an inflatable boat, saying he “defected to freedom.” The man was found on a rubber boat when he was about to set foot on Taiwan at the estuary of Houkeng River (後坑溪) near Taiping Borough (太平) in New Taipei City’s Linkou District (林口), authorities said. The Coast Guard Administration’s (CGA) northern branch said it received a report at 6:30am yesterday morning from the New Taipei City Fire Department about a
IN BEIJING’S FAVOR: A China Coast Guard spokesperson said that the Chinese maritime police would continue to carry out law enforcement activities in waters it claims The Philippines withdrew its coast guard vessel from a South China Sea shoal that has recently been at the center of tensions with Beijing. BRP Teresa Magbanua “was compelled to return to port” from Sabina Shoal (Xianbin Shoal, 仙濱暗沙) due to bad weather, depleted supplies and the need to evacuate personnel requiring medical care, the Philippine Coast Guard (PCG) spokesman Jay Tarriela said yesterday in a post on X. The Philippine vessel “will be in tiptop shape to resume her mission” after it has been resupplied and repaired, Philippine Executive Secretary Lucas Bersamin, who heads the nation’s maritime council, said
REGIONAL STABILITY: Taipei thanked the Biden administration for authorizing its 16th sale of military goods and services to uphold Taiwan’s defense and safety The US Department of State has approved the sale of US$228 million of military goods and services to Taiwan, the US Department of Defense said on Monday. The state department “made a determination approving a possible Foreign Military Sale” to the Taipei Economic and Cultural Representative Office in the US for “return, repair and reshipment of spare parts and related equipment,” the defense department’s Defense Security Cooperation Agency said in a news release. Taiwan had requested the purchase of items and services which include the “return, repair and reshipment of classified and unclassified spare parts for aircraft and related equipment; US Government
More than 500 people on Saturday marched in New York in support of Taiwan’s entry to the UN, significantly more people than previous years. The march, coinciding with the ongoing 79th session of the UN General Assembly, comes close on the heels of growing international discourse regarding the meaning of UN Resolution 2758. Resolution 2758, adopted by the UN General Assembly in 1971, recognizes the People’s Republic of China (PRC) as the “only lawful representative of China.” It resulted in the Republic of China (ROC) losing its seat at the UN to the PRC. Taiwan has since been excluded from