OPEC isn’t going to stop flooding the market with oil any time soon.
The oil cartel wrapped up its summit in Vienna on Thursday by deciding not to change its output policy.
The meeting discussed a proposal by Saudi Arabia to implement a cartel-wide production quota range aimed at restoring a sense of unity to the fractured group, a Nigerian delegate told CNNMoney’s John Defterios.
However OPEC members failed to agree on the proposal.
The idea, floated by new Saudi Arabia energy minister Khalid Al Falih, would have limited OPEC oil output to a range of 31.8 million to 32.5 million barrels per day. That would have been down from 32.77 million barrels now.
It’s clear OPEC believes its strategy of all-out production is working by reducing output from other global oil producers and easing the epic supply glut that caused oil prices to crash.
The cartel pointed to declining non-OPEC supply, projecting a drop of 740,000 barrels per day this year due to shrinking cash flows and investment cutbacks.
“It is evident that these developments point to a more balanced market in the second half of this year,” Mohammed bin Salah Al-Sada, Qatar’s energy minister, said in a speech before the decision was announced.
OPEC did agree to name Nigeria’s Mohammed Barkindo the group’s new secretary general. He replaces Libya’s Abdullah al-Badri, who had been serving as acting secretary-general.
The next OPEC meeting takes place November 30 in Vienna.
