OPEC Meeting to Seek Cuts in Oil Production

The OPEC ministers’ meeting Wednesday will aim for more cuts in oil production to stop a price slide.

But oil experts believe that OPEC may agree only to modest output curbs, possibly 5% to 7%--to just below 23 million barrels.

OPEC’s production reached an 11-year high of 24.2 million barrels a day in January, despite voluntary cuts announced by nine of its 13 members to shore up prices.

The Organization of Petroleum Exporting Countries says the average price this year for its basket of seven grades of oil was $16.78 a barrel, compared to its minimum target of $21.

The price of oil showed a modest loss Monday after rising above $20 per barrel on the futures market for the first time this year.

Light, sweet crude oil for delivery in March settled at $19.78 per barrel, down 9 cents, on the New York Mercantile Exchange.

OPEC ministers fear that prices will tumble unless they adjust output to the weaker demand, which stems from the global recession.

“To make a balanced market, a cut of 5% is enough,” said a Gulf industry source privy to Saudi Arabian oil policy.

The source expects OPEC, which controls more than a third of the world’s oil supply, to agree to an output figure between 22.5 million and 23 million barrels a day.