The Organization of the Petroleum Exporting Countries yesterday delayed a decision on whether to cut the cartel's oil output, but demand that is falling in the United States and unexpectedly weak in China makes it likely that the group will lower production at its Dec. 17 meeting in Algeria, analysts and OPEC ministers said. Saudi King Abdullah said in an interview published yesterday in a Kuwaiti newspaper that $75 a barrel would be a "fair price" for crude oil, well above Friday's closing price of $54.43 a barrel on the New York Mercantile Exchange but far below price levels OPEC was dealing in just four months ago.
Whether OPEC can arrest the slide in oil prices is a key question for everyone from U.S. motorists, now paying a nationwide average of less than $2 a gallon for regular gasoline for the first time since March 2005, to giant oil companies, many of which are shelving high-cost oil exploration and development projects.
In Canada, where oil tar sands projects would be worthwhile only if prices were higher than they are today, plans for expanded production have been postponed. Saudi Arabia has postponed plans to develop the Manifa oil field, which could produce 900,000 barrels a day of heavy crude oil.