The Organisation of Petroleum Exporting Energy Countries (OPEC) decided, Wednesday, for the first time in three years, to increase its production ceiling to 30 million barrels per day, but, the group will not set individual quotas for each member.
The new quota is for all members, including Iraq and Libya, and compares with actual November production from those 12 nations of 30.37 million barrels a day, according to OPEC estimates.
The target will be reviewed at its next meeting on June 14 and replaces a previous target for 11 OPEC nations, excluding Iraq, of 24.845 million.
OPEC is raising its quota to more closely match current production while at the same time gauging the possibility of a slowing global economy and rising Libyan supply.
Its last meeting in June broke up without consensus when six members including Iran and Venezuela opposed a formal push to pump more oil. Saudi Arabia and other Gulf nations went ahead anyway and increased supply to make up for halted Libyan exports.
Brent crude for January delivery plunged $3.33, or 3 percent, to $106.17 a barrel as 4:02 p.m. London time on the ICE Futures Europe exchange. Prices are up 12 percent this year after gaining 8 percent in 2010.
(Source: Sweet Crude Reports)