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OPEC was expected to trigger a 6 percent cut in its official crude oil output after Russia, relenting to intense pressure, agreed to reduce its production by 150,000 barrels a day to help lift sagging oil prices.
Russia's decision yesterday ended a showdown with OPEC that threatened to unleash a potentially devastating price war for crude. One energy analyst forecast that the overall decrease in oil output would nudge gasoline prices higher but said he expected the rise would be modest, the Associated Press reported.
OPEC was preparing to issue a statement announcing it would proceed with cuts of 1.5 million barrels a day in its own production, said an OPEC official, speaking on condition of anonymity from the group's headquarters in Vienna, Austria.
After the decision in Russia, attention shifted to Norway, the world's third-largest exporter of oil behind Saudi Arabia and Russia. OPEC has asked Norway for similar cuts. A commitment from Norway, together with the pledge from Russia, would come very close to satisfying OPEC's demand that oil-producing countries outside the group cooperate with its plan to reduce its own production by 1.5 million barrels a day, or 6 percent. OPEC supplies about a third of the world's oil.
Prices may not jump as anticipated, though. Energy analysts noted that U.S. inventories of gasoline and other refined products are plentiful.