The basket oil price used by OPEC to set its output slipped again to $ 19.65, below the 22-dollar floor of the organisation's target range for a seventh trading day, its secretariat said on Thursday. The basket price, an average of seven world crudes, was down from 20.30 the previous day, said OPEC officials, who base the daily basket price on the previous working day's world crude prices.
Under a price mechanism system aimed at keeping prices within a 22-28 dollar range, OPEC could cut production by 500,000 barrels a day if the basket price remains below 22 dollars a barrel for 10 trading days in a row. The 10th day will be reached on Friday if the price remains below $ 22.
Organisation of Petroleum Exporting Countries (OPEC) ministers agreed at a meeting in Vienna last week to leave output unchanged, but signaled they would cut output in the coming weeks if oil prices remained weak.
The basket price slumped to two-year lows last week amid forecasts of slumping demand for oil as the global economy slows further in the wake of last month's terror attacks in the United States. Bureau Report