In a marathon meeting lasting until early Wednesday, ministers from OPEC's 13 member states agreed to produce a limit of 28.8 million barrels a day. At a news conference, OPEC President Chakib Khelil translated that limit into real terms.
"I think, if you do your own calculation, probably it will be a lowering of production by about 520,000 barrels," he said."
Khelil says the decision takes effect immediately, with a 40-day time frame for it to be implemented. To a certain extent, it comes as a surprise. Earlier indications suggested members might hold production steady, despite plummeting oil prices in recent months, partly because of a restrengthening dollar and tough economic times. They fell below $100 a barrel, Tuesday, for the first time since April.
Khelil suggests that trend might continue, despite OPEC's production cut.
"My hunch is probably the price will still be going down, despite the decisions that we're making," Khelil said. "So, I don't think this will affect the consumers in any way because, first of all, there is an over supply, everybody agrees with that
Analysts are divided over whether prices will continue to fall. Some suggest that more storms such as those that have battered the Caribbean and the United States could cause prices to rise.