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OPEC Oil Prices Fall Below 19 Dollars per Barrel
The average price of OPEC's basket of seven crudes declined to 18.54 U.S. dollars a barrel Thursday, the first trading day since July 1999 that OPEC's average price fell below 19 dollars a barrel, the Vienna-based OPEC Secretariat reported.
The continuing drop of oil prices over the past three days has taken them to a two-year low. The basket price Tuesday was 19.48 dollars a barrel, 15 cents down from the previous day, while on Wednesday it was 19.07 dollars a barrel, dropping 41 cents more. Thursday's fall of over 50 cents has made it the 19th consecutive trading day that the basket price was below 22 dollars a barrel, the bottom end of OPEC's target price band of 22-28 dollars a barrel.
Owing to the diminishing global petroleum demand caused by economic gloom, OPEC has made three output cuts in vain this year to prop up prices, and the September 11 terror attacks worsened the situation.
A week ago Saturday the Paris-based International Energy Agency dropped its forecast on world demand in the fourth quarter this year to 76.2 million barrels per day, 1 million lower than expected. OPEC sliced 1.2 million to 76.56 million barrels a day accordingly. It also lowered the average world demand per day during the year 2001 to 75.93 million barrels, 0.42 million less.
OPEC members and non-OPEC producers are consulting on an output cut. OPEC's three largest producers -- Saudi Arabia, Iran, and Venezuela -- recently expressed their support for further cuts in production, and called on non-OPEC producers to control the output to restore the flagging crude prices.
To stabilize the world market in the wake of the September 11 terror attack, OPEC decided during its ministerial meeting at the end of September to keep production at 23.201 million barrels a day unchanged. The cartel will hold a special meeting on November 14 in Vienna to discuss the market situation and oil prices.
The cartel's Ministerial Monitoring Committee (MMC), composed of oil ministers from Iran, Kuwait, and Algeria, is meeting Friday in Vienna, which is expected by experts here to bring OPEC's proposal of output into action.
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