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| Version 9 | Version 10 |
|---|---|
| Oil falls despite production cuts | Oil falls despite production cuts |
| (about 1 hour later) | |
| World oil prices have continued to fall, undermining oil cartel Opec's efforts to steady prices by cutting output by 1.5 million barrels a day. | |
| The decision to cut about 5% of the cartel's total daily output came after an emergency Opec meeting in Vienna. | The decision to cut about 5% of the cartel's total daily output came after an emergency Opec meeting in Vienna. |
| But the move did not halt the sliding oil price, with US sweet light crude shed $4.80 to $63.04. London Brent dropped $4.42 at $61.50. | |
| Recession fears have pulled oil down from a high of $147 a barrel in July. | Recession fears have pulled oil down from a high of $147 a barrel in July. |
| Dramatic collapse | Dramatic collapse |
| In a statement after the meeting, Opec said it had cut output because supply outpaced demand, and prices had collapsed dramatically in recent weeks. | In a statement after the meeting, Opec said it had cut output because supply outpaced demand, and prices had collapsed dramatically in recent weeks. |
| There's not going to be any impact on inflation, there's not going to be any impact on growth OPEC President Chakib Khelil UK supermarkets in petrol price war | There's not going to be any impact on inflation, there's not going to be any impact on growth OPEC President Chakib Khelil UK supermarkets in petrol price war |
| The cut will take effect from 1 November. | The cut will take effect from 1 November. |
| The 13-nation producers group, responsible for producing about 40% of the world's total supply, said it would continue to provide the market with the crude oil volumes required by consumers. | The 13-nation producers group, responsible for producing about 40% of the world's total supply, said it would continue to provide the market with the crude oil volumes required by consumers. |
| Analysts had expected Opec to cut output by at least one million barrels a day and some producers - such as Venezuela and Iran - wanted greater cuts. | Analysts had expected Opec to cut output by at least one million barrels a day and some producers - such as Venezuela and Iran - wanted greater cuts. |
| More cuts? | More cuts? |
| OPEC President Chakib Khelil said because Opec members produce about 300,000 barrels a day more than the official quota of close to 29 million barrels, the total reduction by the end of the year would be about 1.8 million barrels a day. | OPEC President Chakib Khelil said because Opec members produce about 300,000 barrels a day more than the official quota of close to 29 million barrels, the total reduction by the end of the year would be about 1.8 million barrels a day. |
| Mr Khelil rejected the suggestion that the decision would hurt the global economy. | Mr Khelil rejected the suggestion that the decision would hurt the global economy. |
| "There's not going to be any impact on inflation, there's not going to be any impact on growth." | "There's not going to be any impact on inflation, there's not going to be any impact on growth." |
| Opec oil ministers said that they would review their decision at their next meeting in December, leaving open the possibility of further cuts beforehand if necessary. | Opec oil ministers said that they would review their decision at their next meeting in December, leaving open the possibility of further cuts beforehand if necessary. |
| Revenue worries | Revenue worries |
| Ahead of the meeting, some of the cartel's members called for a reduction in output to stop the fall in prices: Venezuela wanted production to be cut by a million barrels a day, while Iran had called for a cut twice that size. | Ahead of the meeting, some of the cartel's members called for a reduction in output to stop the fall in prices: Venezuela wanted production to be cut by a million barrels a day, while Iran had called for a cut twice that size. |
| The two countries are thought to be most in need of a relatively high oil price - around $100 a barrel - to finance government spending, says the BBC's economics correspondent, Andrew Walker. | The two countries are thought to be most in need of a relatively high oil price - around $100 a barrel - to finance government spending, says the BBC's economics correspondent, Andrew Walker. |
| Iran relies almost entirely on its oil exports for government revenue: for every dollar off the price of a barrel of oil, the country loses roughly $1bn a year in revenue. | Iran relies almost entirely on its oil exports for government revenue: for every dollar off the price of a barrel of oil, the country loses roughly $1bn a year in revenue. |
| But British Prime Minister Gordon Brown warned that any reduction made in a bid to push up oil prices would be "scandalous" at a time when major economies were close to tipping into recession. | But British Prime Minister Gordon Brown warned that any reduction made in a bid to push up oil prices would be "scandalous" at a time when major economies were close to tipping into recession. |
| Motorists benefit | Motorists benefit |
| Oil prices hit an all-time high of $147 a barrel in July, but have since fallen back steadily. | Oil prices hit an all-time high of $147 a barrel in July, but have since fallen back steadily. |
| Prices now stand at levels not seen since last spring, amid fears a global economic recession will cut demand. | Prices now stand at levels not seen since last spring, amid fears a global economic recession will cut demand. |
| The price that motorists have been paying for petrol at forecourts has been falling recently. | The price that motorists have been paying for petrol at forecourts has been falling recently. |
| A price war has broken out among leading UK supermarkets with Asda, Sainsbury's, Tesco and Morrisons all announcing cheaper petrol on Friday. | A price war has broken out among leading UK supermarkets with Asda, Sainsbury's, Tesco and Morrisons all announcing cheaper petrol on Friday. |
| But some observers believe moves to reduce production could reverse that trend. | But some observers believe moves to reduce production could reverse that trend. |