Subscribe free to our newsletters via your
. 24/7 Space News .




ENERGY TECH
Tough times force OPEC members to close ranks
by Staff Writers
Cairo (AFP) Dec 6, 2009


Divisions within OPEC have eased as the dual threat of the global economic crisis and climate change talks force oil producers to be pragmatic and unified, analysts said on Sunday.

Two years ago, when oil prices soared to nearly 100 dollars a barrel, the oil exporters cartel, which includes both allies and foes of the United States, was severely tested.

The Organisation of Petroleum Exporting Countries was then torn between price hawks like Algeria, Iran, Libya and Venezuela on one side and nations like Saudi Arabia which wanted moderate prices in the interests of consumers.

But the stance of the price hawks has since lost support, leading to a convergence of positions within the bloc.

Less than three weeks ahead of the next OPEC meeting in Luanda, Angola, the group's oil ministers agree that quotas must remain at their current level of 24.84 million barrels per day (bpd).

Even US arch-foes Iran and Venezuela support that view.

Although the price of oil is trading at around 75 dollars a barrel, nobody is daring to ask for 100 dollars.

Observers say this unity has come about largely thanks to pragmatism instilled into producers by the events of 2008: an unprecedented price surge to 147.50 dollars a barrel, followed by a plunge to 32.40 dollars in December.

"What happened makes you think. An oil price of 75 dollars is higher than they could have hoped for. Even the most hawkish nations are finding it hard to ask for more," said Francis Perrin of the Oil and Gas Journal.

This turnaround came about because producers were afraid of another price collapse, according to Julian Lee, analyst at the Centre For Global Energy Studies in London.

"They still have a big fear of oil (prices) falling ... They haven't entirely lost that fear," said Lee.

Another reason for the appeasement of the hawks was that the countries which traditionally call for high prices have proved less than effective in implementing decisions taken by OPEC.

At a meeting in Oran, Algeria in December 2008, OPEC pledged to withdraw 4.2 million bpd from production from the start of 2009 in order to stabilise the market.

However, the bulk of the sacrifice was provided by Saudi Arabia, while Iran did not implement the agreed cut in production.

"The influence of the hawks is limited" because "if somebody raises the issue of higher prices ... he will be told to comply more," said David Wech, an analyst at JBC Energy.

Finally, while the impact of the global recession is still being felt on oil demand, another key challenge for producers looms in the shape of measures to reduce carbon emissions.

Such a deal could be signed this week in Copenhagen during landmark UN-led talks on tackling global warming.

"When you see in the OPEC bulletins the rising concern linked to climate change, you can see that producers are closing ranks," said Perrin. "In the hardest times in its history, OPEC tends to stick together."

Measures to reduce the share of fossil fuels in total energy consumption directly threaten the interests of oil producers.

OPEC's decision last December to cut production by 4.2 million bpd officially brought down the total output of the 12-member cartel -- excluding Iraq -- to 24.84 million bpd.

On Friday, crude prices tumbled in volatile trade, succumbing to a stronger dollar following an improved US jobs report picture.

New York's main contract, light sweet crude for January delivery, fell 99 cents to 75.47 dollars a barrel. In London, Brent North Sea crude for delivery in January dropped 84 cents to settle at 77.52 dollars a barrel.

.


Related Links
Powering The World in the 21st Century at Energy-Daily.com






Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks
del.icio.usdel.icio.us DiggDigg RedditReddit GoogleGoogle








ENERGY TECH
Kenya authorities say oil spill narrowly averted
Mombasa, Kenya (AFP) Dec 3, 2009
The Kenya Marine Authority (KMA) said it narrowly averted an oil spill Thursday after a Liberia-flagged tanker that developped a list as it sailed into Mombasa port was stabilized. "This morning, the MT "Voge Trust", an oil tanker flying the Liberian flag was entering the port of Mombasa when she developed a list. KMA mobilized and dispatched her rescue and pollution control teams to the shi ... read more


ENERGY TECH
Circumlunar Missions: The Missing Link

Partial Gravity And The Moon

Astronomy Question Of The Week: What Happens On The Moon During A Lunar Eclipse

The Lunar Oasis

ENERGY TECH
Orbiter Puts Itself Into Safe Standby

Mars Meteorite Debate Continues

Sandtrapped Rover Makes A Big Discovery

Opportunity Continues Study Of 'Marquette'

ENERGY TECH
Virgin Galactic readies maiden suborbital flight

Astronauts to taste 'space sushi'

NASA to initiate scholars program

Canadian Astronaut Robert Thirsk Lands On Earth

ENERGY TECH
Chang'e-1 Has Blazed A New Trail In China's Deep Space Exploration

China To Launch Second Lunar Probe In 2010

China To Launch Research Satellite In Near Future

China's military making strides in space: US general

ENERGY TECH
Russia Plans To Send 10 Spacecraft To ISS Next Year

SpaceX Begins NASA Astronaut Training For Dragon Spacecraft COTS Program

Four "Butterflynauts" Emerge On ISS

Expedition 21 Crew Lands In Kazakhstan

ENERGY TECH
Arianespace Marks 30 Years Of Launch Services Excellence

WISE Spacecraft Ready For Launch Dec 9

Ariane 5 Getting Ready To Launch Helios 2B Reconn Satellite

Boeing Ships High-Def Broadcasting Satellite DIRECTV 12 To Launch Site

ENERGY TECH
Superior Super Earths

UCF Space Experiment To Fly On New Rocket Ship

SOFIA Seeks Secrets Of Planetary Birth

Hunting For Planets In The Dark

ENERGY TECH
Space Debris Removal Gets Visibility

Taiwan to invest 65 million dollars in e-book industry

New way to make single-crystal structures

Bangladesh Plans To Launch Telecom Satellite Soon




The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement