With oil prices settling in the low $50′s it appears that the Organization of Petroleum Exporting Countries (OPEC) is on the verge of approving another oil production cut to help buoy oil prices.
Since hitting record highs in August of 2006, the price of oil has fallen over 33% to reach current levels. Even after closing up by nearly $1 on Friday, the price of oil has fallen nearly 15% during the first two weeks of 2007 alone thanks to an unusually warm winter in the eastern United States.
The unseasonably mild weather has lead to a continued rise in the United State’s oil inventories thanks to a large reduction in demand for heating oils and natural gas.
Thanks to the recent price drop, it appears that OPEC is ready and willing to add to their production cut of 1.7 million barrels per day in order to try and bring oil prices back up to $60 per barrel – a price OPEC has stated they will vehemently defend.
In better news, the national average gas price has finally started to fall with oil prices, dropping nearly five cents during the past three days. Let’s just hope that gas prices don’t shoot back up at the first hint that oil prices might rebound.