OPEC Expected Not to Cut Oil Production

With OPEC members cashing in on current high oil prices, the producer group is unlikely this week to cut its production target, in spite of concerns about a crude surplus in the spring.

Oil analysts expect the Organization of the Petroleum Exporting Countries to leave its output ceiling unchanged and to postpone any official cuts until early next year.

OPEC representatives are to meet Thursday in Vienna to review oil market conditions and reassess the group’s output ceiling, now at 24.5 million barrels a day.

“As long as the price stays where it is, they won’t do anything,” said Adam Sieminski, an oil price strategist at Deutsche Bank in London.

Such a strategy could offer some relief to the global economy as it nurses a recovery, and it would serve the short-term financial interests of OPEC’s oil-dependent exporters, which supply about one-third of the world’s crude.

OPEC had agreed to cut production by 3.5%, or 900,000 barrels a day, starting in November. However, prices last month hovered at or above $28 a barrel -- the top end of OPEC’s desired range -- and several of the group’s 11 members are pumping well beyond their quotas to take advantage of the windfall.

OPEC’s benchmark price stood at $28.39 a barrel on Thursday, the most recent day for which the group compiled information. OPEC’s formal target for prices is $22 to $28 a barrel.

From Associated Press