October 24, 2008 in City

Iran urges OPEC to cut oil production

Associated Press

VIENNA, Austria – Iran on Thursday called on OPEC to slash oil production by a daily 2 million barrels to stop a steep slide in prices that has left crude at its cheapest since last summer.

Other oil ministers of the Organization of Petroleum Exporting Countries also said output cuts had to be discussed at their meeting Friday – while suggesting that a fine line had to be walked to stop the market’s decline without further denting shaky world economies.

Spooked by prices that have slid more than 50 percent from record highs of around $147 a barrel in July, the 13-nation OPEC has little choice but to scale back production.

Benchmark crude futures were up Thursday – but only moderately, in a response to expectations of an OPEC cutback. They were fetching $67.62 a barrel in electronic trading on the New York Mercantile Exchange by noon in Europe after falling $5.43 to settle Wednesday at $66.75 a barrel, their lowest close since June 13, 2007.

The emergency meeting was originally scheduled for Nov. 18 but was suddenly rescheduled for Friday earlier this month, in a reflection of OPEC’s concerns.

“They’re in a bit of panic,” said trader and analyst Stephen Schork, of Villanova, Pa. “They underestimated what happens when the bubble implodes.”

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