Opec moves to reduce production

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Oil ministers from producers' group Opec have expressed their support of an imminent reduction in production levels - the first in two years.

Both Iran, Opec's second largest producer, and Algeria have publicly endorsed the proposal made on Thursday.

Edmund Daukoru, Opec president and Nigeria's oil minister said there was "more or less" consensus for a one million barrel per day reduction.

The decision comes after oil dropped to below $60 a barrel on Friday.

'Credible position'

Friday's closing price of $59.76 per barrel for US crude oil represented a sharp drop from the peak of $78.40 seen in the middle of July.

The proposed reduction would be based on an official production level of 28 million barrels per day.

While a meeting is scheduled for 14 December, Opec members have talked recently of the possibility of an emergency meeting before then.

"What is important is that the market finds the Opec position credible," said Algerian Energy and Mines Minister Chakib Khelil.

"That is why it is necessary to have a meeting to make a decision on the cut and to act on it."

Mr Daukoru said he did not favour an emergency meeting but would discuss the matter with colleagues.

The latest decision follows a move last weekend by Nigeria and Venezuela to reduce their combined oil production by 170,000 barrels per day.

If the 11-nation group does favour reducing output it will mark the first reduction since April 2004.

Oil prices have been sliding in recent months prompted by a weaker-than-expected hurricane season and solid US inventories of oil stocks.