Thursday, September 11, 2008

THE OIL GAME

The world oil price rebounded above $100 per barrel after touching recent low to $99

per barrel. On September the 10th the member of OPEC countries met to discuss the oil

price which dramatically declined from their peak $147 per barrel in July amid a global

economic slowdown. All over the world the rate of inflation rose high and they are

still hovering around their recent peak level. However a surprise decision to cut

production by 520000 barrels a day taken by member of OPEC cartel. It is reported that

OPEC president and Algerian energy minister, Mr Chakib Khelil said the output cut

would start immediately. He further added "if you do your own calculations, it is a

cut of 520000 barrels per day"; announcing a new OPEC output quota of 28.8 million

barrels per day.



The International Energy Agency (IEA) meanwhile cut its estimate for global oil demand

this year and next, saying consumers mainly in the United States are changing their

lifestyles in response to high prices. The IEA's monthly report was printed before

OPEC's announcement. US eneergy secretary, Mr Samuel BOdman has asked for producers

to keep oil markets well supplied before the OPEC meeting started.





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