Kuwait's oil minister urged fellow OPEC producers to comply with a record oil supply cut agreed by the group to shore up oil prices.
Kuwait's oil minister urged fellow OPEC producers to comply with a record oil supply cut agreed by the group to shore up oil prices. "There is commitment in general to agreed (production) levels but there is a need to enhance it," Mohammad al-Olaim told. "Kuwait will be committed to its quota. "The OPEC decision was taken to be implemented and is not meant for the media," he said.
Oil CLc1 fell below $40 a barrel after the Organization of the Petroleum Exporting Countries agreed a 2.2 million barrel per day (bpd) output reduction on Wednesday to revive prices battered by slumping demand for fuel.
For a sustained price recovery, OPEC must enforce strict compliance with its output curbs -- historically a tricky task in a falling market.
The group that pumps more than a third of the world's oil already has reductions of 2 million bpd in place since November. But OPEC itself estimates November compliance with those curbs at only around 50 percent.
Olaim said he expected market conditions to remain difficult for the first half of 2009.
"The (market) situation will be difficult to a certain extent especially in the first six month in view of the situation," said Olaim.
The latest cut lowers the supply target for the 11 members bound by output limits to 24.845 million bpd -- down nearly 15 percent from September output. It takes effect from January.