Business Economy 24 May 2017 OPEC likely to exten ...

OPEC likely to extend output cuts, but price relief elusive

AP
Published May 24, 2017, 2:20 pm IST
Updated May 24, 2017, 2:20 pm IST
Ministers of 13-nation cartel will likely decide to prolong them in an effort to support prices.
Even a slight rise in oil value per barrel will fuel further US shale production.
 Even a slight rise in oil value per barrel will fuel further US shale production.

Vienna: OPEC oil ministers meeting this week appear damned if they don't extend production cuts -- and only slightly less damned if they do. Ministers of the 13-nation cartel will likely decide to prolong them in an effort to support prices, when they meet Thursday.

But even a slight rise in value per barrel will fuel further U.S. shale production,  meaning more and cheaper oil down the road. Even after last year's cuts, oil prices have risen less than the Organization of the Petroleum Exporting  Countries hoped for.

 

Benchmark crude that flirted with the $30 mark now fetches over $50 barrel, but  that is substantially less than the highs reached in 2014. Still, it's been enough to bring U.S. producers who eased back as prices tumbled last year back into the market.

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