Cartel ministers tackle falling oil prices

VIENNA, Sept 8 (AFP) OPEC ministers headed for Vienna today (Monday) to wrestle with the issue of falling oil prices, with analysts expecting them to agree to trim output to help keep crude above 100 dollars a barrel. brThe question facing the oil producer group, which is to hold a policy meeting Tuesday, is when, not if, to cut its oil production target as crude prices slide in the face of weakening global economic growth, analysts say. brMost observers expect the 13-nation cartel to agree to reduce its output informally before waiting until later, possibly at a scheduled gathering in December, to alter its official output target. brThe informal cut will be achieved by members, mainly powerhouse Saudi Arabia, agreeing to cut their excess production above their OPEC quota, which would remove oil from the market but not amount to a formal change in policy. brUnder fierce pressure from the United States, Saudi Arabia agreed in May and June to increase production to help calm the runaway crude market which reached a pinnacle on July 11, when crude struck 147 dollars a barrel in New York. brSaudi Arabia, the world's biggest crude producer, is estimated to be producing about 700,000 barrels per day above its quota. brThe stakes are entirely different to the last time OPEC members met in March, when crude prices had broken through 100 dollars a barrel and were on a steep upwards trajectory. brMeanwhile, Iranian Oil Minister Gholam Hossein Nozari said today that OPEC was oversupplying the market as he arrived for a meeting of the cartel here. brOf course there is an oversupply, he told reporters. brIran has backed calls for greater compliance with OPEC production targets as a way of reducing output from the 13-member group. brAt present, OPEC is believed to be producing about one million barrels more than its quota of 29.67 million barrels per day (bpd), with Saudi Arabia providing most of the extra oil. brWe will review the market and then decide, said Nozari when asked about whether an official production cut would be approved at a Tuesday policy meeting of the the Organization of Petroleum Exporting Countries. brAnalysts think the group will opt for greater quota compliance instead of an outright production cut. This would remove oil from the market but not amount to a potentially unpopular policy change. brOil prices have fallen sharply from highs near 150 dollars a barrel in July to slightly above 100 dollars.