Opec member states have never directly discussed a target price for crude oil, according to the cartel’s longest-serving minister.
Speaking at an Opec conference in Doha on 16 May Abdullah bin-Hamad al-Attiyah said that although Opec members had discussed a range of prices which they saw as beneficial to both producers and consumers they had never held talks over the “right “ price for oil.
“Opec never discussed this matter of what is the right price,” he said. “We can say what is a reasonable price; we can discuss a centre-point of how we can live; but a reasonable price is just an assumption.”
In 2008, the cartel’s member states set a target to cut 4.2 million barrels a day (b/d) from its members’ output between September 2008 and the end of February 2009, to a total of 24.85 million b/d to curb falling oil prices.
Since prices bottomed out below $35 a barrel in the first quarter of 2009 they have hit peaks above $85 a barrel as demand increased following the global financial crisis of 2008-2009. However, fears over the US economy and the stability of Eurozone members has recently seen prices fall back, with the US’ benchmark West Texas Intermediate contract trading at $70 a barrel, sparking rumours that Opec would cut production again to push values back up.
Al-Attiyah says that the price described as “right” by Saudi Arabia’s ruler King Abdullah of $75 was comfortable for both producers and consumers.