OPEC facing split?

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From Fazle Rashid
NEW YORK, Sept 11: The Organisation of the Petroleum Exporting Countries, famously known in acronym of OPEC, is moving towards a split. Saudi Arabia, the largest oil producing nation in the cartel has announced that it would defy the OPEC's decision to cut production not to allow the price of oil to slip down below $100 barrel.
Saudi negotiators initially agreed to adhere to OPEC's decision but subsequently reversed its stand. OPEC confronts its most difficult challenge in years as to how to respond to falling oil prices in a weakening global economic climate.
Chakib Khelil, Oil Minister of Algeria who is now the president of the cartel expressed concern over slowing demand for oil which has resulted in glut in supply. This will precipitate a collapse in price.
OPEC is set to reduce production by 500,00 barrels a day to steady the price of petrol. "We don't want to these prices decline dramatically," a pro-cut advocate opined.
Saudi Arabia is now extracting 9.7 million barrels of crude daily which is 600,000 barrels a day more than its normal quota. Saudi Arabia is not willing to do anything ahead of the US Presidential election set for Nov 4. Indonesia a member since 1962 has now turned into an oil importing country. It is withdrawing its OPEC membership.
Pro-western countries like Saudi Arabia and the United Arab Emirates say high energy cost is hurting demand. These countries want the petrol price to fall below $100 a barrel. Iran and Venezuela oppose the move.
The development around the globe does bode well for global economy. New areas of friction are emerging that would certainly have an adverse impact. Iraq for instance has withdrawn its earlier decision to award oil contracts to six American oil companies to modernise and accelerate its oil revenue. The contract has now been given to China.
In another separate development, American decision to unilaterally attack Taleban sanctuaries along Pakistan border will further compound an already complicated situation. President Bush has ordered American forces to carry out operations against the Talebans without prior approval of Pakistan, the New York Times reported today. America will now just notify and not seek any approval for launching military attack on Taleban strongholds from Pakistan territory. America will be more assertive. Orders have been issued, NYT quoted an American official as saying. America thinks that Pakistan lacks the will and ability to combat the militants. Americans harbour distrust about Pakistan military and the intelligence agencies.
Asif Ali Zardari upon being sworn-in as president promised to launch an allout attack on Talebans.
Pakistan Army has reacted harshly. Pakistan's army chief Gen. Ashfaq Parvez Kayani said his forces will not tolerate American incursion and would defend country's sovereignty at all cost.