Luanda: The Organisation of Petroleum Exporting Countries, or Opec, could meet before March if Brent crude oil prices fall to below $40 (Rs1,968) per barrel, the group’s president was cited by Angolan weekly newspaper O Pais as saying.
Although Jose Botelho de Vasconcelos said he only expected the next gathering of the 12-member Opec to take place, as planned, in Vienna on 15 March, he added the group could meet sooner if oil prices suddenly dropped.
Asked whether a fall in the price of Brent crude to below $45 per barrel would trigger an early Opec meeting, he said, “We admit it could happen if (oil prices) drop below $40.”
Opec, which pumps about a third of the world’s oil, agreed to cut its output by 2.2 million barrels per day (mbpd) last month in reaction to a slide of more than $100 in oil prices since July as the global economic slowdown slams energy demand.
What next? A December photo of Opec delegates in Oran, Algeria. The group may cut production again if crude prices fall further. Antoine Antoniol / Bloomberg
Fuel demand in the US, the world’s biggest oil-consuming country, averaged 19.4 mbpd during the four weeks ended 16 January, down 4.7% from a year earlier, Thursday’s Energy Department report showed.
The latest cut helped prices recover from recent lows on Friday, although prices remain much below the head of Opec’s 2009 target of $75 per barrel—a price Botelho de Vasconcelos says is necessary for oil exploration to be viable.
London Brent rose $2.98 to $48.37 a barrel on Friday and US crude settled up 2.80% at $46.47.
“A reference price of $75 per barrel enables us to maintain and develop our activity and turn medium-to-long-term projects viable,” Botelho de Vasconcelos, who is also the Angolan oil minister, said.
Asked if Opec would carry out more cuts if prices did not reach $75 per barrel in March, he replied, “We could continue to carry out more cuts.”
He added that other major oil-producing countries, such as Russia, Azerbaijan and Norway, which don’t belong to Opec, were welcome to join as this would increase the impact of the decisions taken by the cartel.
“They have been invited. They have participated (in Opec meetings). It is in the interest of everyone that oil prices reach a certain level,” he said.