MIDDLE EAST — The OPEC oil cartel has announced it will cut production by 3.5 per cent starting next month.
The cartel blamed declining prices and rising inventories. OPEC pumps about a third of the world’s crude oil. The cartel agreed to set quotas to keep the price of its oil index between $22 and $28 a barrel. But prices have dropped 13% in the past month for OPEC’s benchmark, to about $25 a barrel.
Ministers maintained quotas at their last two meetings, held in June and July, amid expectations OPEC would need to reduce supply to make room for Iraq.
OPEC said it would next meet Dec. 4. The cartel has already predicted the daily supply of crude oil would outstrip demand by 2.5 million barrels during the first quarter of 2004.
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