OPEC to seek meeting if cuts come up short

OPEC ministers have agreed in principle to hold an emergency meeting in Cairo on December 28th if its demands for output cuts…

OPEC ministers have agreed in principle to hold an emergency meeting in Cairo on December 28th if its demands for output cuts by rival exporters are not met.

The meeting would be designed to agree on production policy from January 1st if non-OPEC countries fail to pledge the full 500,000 barrels per day (bpd) cut demanded by the cartel as a condition for its fourth reduction in a year.

Last month OPEC asked rival exporters to join it in reducing global oil output from January 1st and stem oversupply that OPEC fears leading to a price war if left unchecked.

The Organisation of the Petroleum Exporting Countries had offered to cut another 1.5 million bpd from its quotas - the fourth reduction in a year - on condition that rivals contribute 500,000 bpd.

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Mexico, Russia and Oman have said they will cut 275,000 bpd and Norway is due to announce a reduction of 100,000-200,000 bpd in the next few days.

If Norway comes up with an expected 150,000 bpd, that would leave non-OPEC 75,000 bpd short of OPEC's requirement.

Despite Russia's offer, delegates from various OPEC countries said they were concerned in particular that the world's second largest exporter would try to sidestep a deal to trim crude exports by increasing sales of refined products.

OPEC’s most influential country, Saudi Arabia, has laid special importance on a genuine participation by Russia, because its output is expected to leap by 400,000 bpd next year from just over seven million bpd now if cuts are not implemented.