OPEC would cut oil output at below $80: source ($80, a new support level?)

Reuters ^ | 10/08/08

[TigerLikesRooster]

News from Reuters

OPEC would cut oil output at below $80: source

08/10/08

DUBAI (Reuters) - OPEC is unlikely to cut output at its meeting in December unless the price for crude produced by its members falls below $80 a barrel, an OPEC source said on Wednesday.

The price for OPEC's basket of crude stood just above that threshold on Tuesday, at $80.04 a barrel. U.S. crude, which trades a few dollars higher than OPEC oil, slid to a 10-month low on Wednesday on concern that the international financial crisis would have a major impact on demand for energy.

"The price is still reasonable," the source told Reuters. "If it stays where it is then OPEC will stick to the output levels decided at the last meeting. I think if it falls below $80, OPEC will do more."

Several members of the Organization of the Petroleum Exporting Countries have voiced concern about demand and the falling price. Nigeria was the latest on Wednesday, with its minister saying OPEC may need to intervene to balance markets.

[TigerLikesRooster]

Ping!

[ken21]

i read that $70.00 is break even for iran,

and $50.00 for saudi arabia.

[Doug TX]

But...but...but...BOR told me that the evil speculators controlled the price of oil. How can this be?

[stocksthatgoup]

Rule #1 - Set a ceiling, it becomes the floor.
Rule #2 - Set a floor, it becomes the ceiling.

[Doe Eyes]

But...but...but...BOR told me that the evil speculators controlled the price of oil. How can this be?

The price is dropping because all the new refineries are now coming on line. [/s]

[AlmaKing]

Where’s our buddy Chavez in all this? Still playing with Russian nukes?

Nothing like having your oil profits cut almost in half and still dropping.

[DRey]

"i read that $70.00 is break even for iran,"

I read that Iran can't continue its nuke program with oil below $100/barrel. Wish I could find that source again. It was reputible, as I recall.

[KoRn]

We need to get our own oil, and tell those bastards to drink the stuff.

[AlmaKing]

A mechanical engineering friend is working on refinery expansions in Houston. There may not be a whole lot of new refineries coming online, but there are many expansions occurring.

[DRey]

I keep hearing this number, the US has 3% of the oil market. Isn’t that false? Isn’t it that we are currently DRILLING 3% of the oil market, but have much more in untapped reserves? Anyone know?

[KoRn]

I believe I have heard similar numbers.

[river rat]

DRILL, DRILL, DRILL, DRILL -—— Let the %&^$&^ in OPEC learn to drink their oil...

Then - peg the price of a bushel of wheat to the cost of a barrel of THEIR oil.

[Candor7]

Excellent stategery on OPECs part. That will keep oil high enough to encourage exploration and continued Oil Sands work here in the West.

Tangyuberrimudge Opec!

I supeet on your Shahadow!

My 6 cord of firewood tell no lie!

When Bush asked them hat in hand in June, to increase their output, they patted him on the arm and gave him sweet tea.

Now they are royally forked. Looks good to me.

But my guess is $60 /bbl by January.

[Will88]

“i read that $70.00 is break even for iran,

and $50.00 for saudi arabia.”

What do you mean by break even? That term normally means the revenue point where a business covers expenses; no profit and no loss. But those nations’ crude production costs are only a few dollars per barrel.

Do you mean some sort of national budget break even where revenue covers expenditures?

[ken21]

>Saudi needs oil above $49 to avoid deficit; Qatar break-even $24: IMF
DUBAI: Saudi Arabia, the world’s largest oil exporter, will need crude prices to remain above $49 a barrel to avoid a fiscal deficit, a senior International Monetary Fund official has said.<

http://www.gulf-times.com/site/topics/article.asp?cu_no=2&item_no=242775&version=1&template_id=48&parent_id=28

[Will88]

“OPEC would cut oil output at below $80: source.”

Three or so years ago, before this run up to $140+ per barrel, OPEC nations hoped to keep the price around $35.00. Now they’ve gotten accustomed to two to four times that and they want the far greater amounts of easy money coming in.

And domestic crude production is no where near the campaign issue it should be. This could be a big winner for Republicans, but McCain is so tepid on the issue and little is being said about it except Palin’s occasional remarks.

[Uriah_lost]

That is my only reason for not cheering too loudly for falling oil prices. 65-ish is what I understand we need to keep exploration and drilling going forward here.

[Kitanis]

Drill here and Drill NOW..

I notice the press likes to get everyone excited when the price of oil goes up.. and even more excited when the price goes down.

Screw OPEC..

But our politicians will simply cave in.. and do NOTHING for our energy needs.. and will pander to OPEC ministers and pay the price...

[Will88]

Well, that set’s up a situation where the national interests of the OPEC nations and non-OPECs are really at odds. They’re now counting on very high oil prices to meet their budgets, but those high prices are a burden on the economies and family budgets of oil importing nations.

I hope we’ll eventually follow policies that put those nations in to budget deficits. That some are so dependent on oil revenue to meet their budgets shows what little else they have going other than this accidental wealth from oil.