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OPEC Will Maintain Current Ceiling on Daily Production : Energy: Analysts say cheating on output quotas could push prices down next year.

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From Associated Press

OPEC ministers decided Wednesday to maintain the oil cartel’s current production ceiling, but petroleum analysts warned that prices could fall if some members don’t quit cheating on their quotas.

Traders had widely expected a rollover of OPEC’s daily production limit of 24.52 million barrels of oil, and they greeted the news calmly.

The Organization of Petroleum Exporting Countries is getting about $4 to $5 less than its target of $21 for a barrel of crude, and nobody is predicting that the price will rise any time soon.

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The key to future prices may be whether OPEC can control its output as production from non-OPEC countries increases. Many analysts and OPEC’s own economists predict cheating could dampen oil prices next year.

OPEC is now exceeding its ceiling by about 900,000 barrels a day, with Venezuela being blamed for a third of that. The country’s oil minister, Erwin Arrieta, has denied the allegation.

How to get the cartel’s members to stick to their quotas is a delicate issue that OPEC has never resolved, although many ministers at the winter meeting spoke about finding new ways to monitor compliance with the limits.

“The real issue is the compliance,” said Leo Drollas, chief economist for the Center for Global Energy Studies in London who came to observe the meeting. “The market’s looking for compliance.”

Rakadh ibn Salim al-Radadh, the acting oil minister for the United Arab Emirates, said OPEC will take steps to better police the cheaters.

OPEC will meet again in early June to review the ceiling. OPEC members are Algeria, Gabon, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela.

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