Business

Opec boss: Oil price drop will not prompt supply cut

  • 14 December 2014
  • From the section Business
Oil rig in Bahrain, file pic Image copyright AP

The head of Opec has reiterated that it will not try to shore up plunging oil prices by reducing production.

"The decision has been made. Things will be left as is," said Abdallah Salem el-Badri, secretary general of the oil producers' cartel, speaking in Dubai.

On Friday Brent crude dropped below $62 a barrel, its lowest price since 2009.

"The fundamentals should not lead to this dramatic reduction [in price]," Mr el-Badri added.

Mr el-Badri said Opec was "assessing the situation to determine what the real reasons behind the decrease in oil prices are".

The comments are Mr el-Badri's first since Opec's meeting in Vienna last month, where it decided to leave production levels unchanged.

Mr el-Badri said its decision was not aimed at undermining other oil producers.

"Some people say this decision was directed at the United States and shale oil. All of this is incorrect. Some also say it was directed at Iran. And Russia. This also is incorrect," he said.

The price of Brent crude has dropped almost 50% since June on sluggish global demand and rising production from the US.

On Friday, it settled at $61.46 a barrel after the world energy watchdog, the International Energy Agency, forecast even lower prices on weaker demand and larger supplies next year.

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