Opec urged to cut output by two mn barrels

By RIA Novosti,

Abu Dhabi : A Kuwaiti expert has called on the Organisation of the Petroleum Exporting Countries (Opec) to cut production by two million barrels a day to stabilise falling prices, a media report said Saturday.

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Musa Maarfi, member of the country’s top advisory body on oil, told the Al-Kabas newspaper that the 1.5 million barrel cut in daily output, which came into force Nov 1, had been “insufficient”.

The Opec is set to hold an extraordinary meeting in Algeria Dec 17 to decide on further reductions in production.

Russian President Dmitry Medvedev had said Thursday that Moscow could also go for lower production and suggested the country could join Opec, given the importance of oil prices to the economy and government finances.

Maarafi emphasized the necessity of the “coordination of action with such influential non-Opec countries as Russia”.

He said that a price of $40 a barrel – which crude has neared in recent weeks – would restrict investment in extraction and said $75 per barrel was a fair price.

However, a cut of two million barrels per day might not be enough for Russia. A senior executive at Russia’s largest independent producer had said that a 2.5 billion-barrel cut was likely.

“If 2.5 million barrels a day, or 125 million tonnes a year, is taken off the market, the (crude) price could rise to $60-$80,” LUKoil vice president Leonid Fedun said.

Russia and Opec together account for more than half the global oil production.