OPEC Projects Oil Price Rise in Early 2016

OPEC Projects Oil Price Rise in Early 2016

OPEC announced that global crude oil prices, currently at the seven-year low, could rise in under a year time amid cuts in oil output from some producers, Reuters reported, quoting Secretary-General, Abdullah al-Badri.

Crude prices have dropped to the lowest 2004 level of $36 a barrel at the end of 2015. The current global oil production of 2mb/d above demand has generated oversupply in an attempt to drive higher-cost producers such as the US shale out of the market.

OPEC is prepared to hold an urgent meeting if prices do not recover by February, RT wrote. Oil output is likely to decline in the upcoming years as the oil industry has seen investment cuts of up to $130b this year, Badri said.

The announcement comes some weeks after OPEC had adopted a policy that did not limit oil output in early December, Trade Arabia reported.

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