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Underscoring the growing resolve among the largest oil-producing nations to shore up declining prices, Chekib Khelil, the president of the Organization of the Petroleum Exporting Countries (OPEC), said the group would reduce daily oil output starting on Jan. 1.
Khelil yesterday confirmed comments by other OPEC oil ministers that the cartel would move to decrease exports at its next meeting, on Nov. 14 in Vienna. Those ministers, however, declined to say when such a reduction would go into effect.
OPEC, however, has yet to quantify how much the reduction would be. Most industry analysts expect OPEC, which produces about 35 percent of the world's oil, to scale back exports by 700,000 to a million barrels a day, Reuters reported. The group has already pulled back production three times this year by a total of 3.5 million barrels a day, or about 13 percent.
After the Sept. 11 attacks sent the global economy into a tailspin, oil demand dwindled rapidly and prices plummeted. OPEC has so far refrained from cutting production despite the millions of dollars members have lost because of lower prices, the report said. But prices have stabilized at about $21 a barrel. Khelil said OPEC was determined to nudge them up to $25 a barrel by reducing output and restraining the rampant overproduction among its members.