OPEC Declines to Boost Oil Output

$80 crude seems to be producers' new target; $3 gas isn't going anywhere soon
By Jim O'Neill,  Newser User
Posted Dec 6, 2007 10:33 AM CST
Visitors arrive for the first day of the Arab Oil and Gas exhibition in Dubai, United Arab Emirates, Tuesday, Dec. 4, 2007. With oil prices backing away from record levels but nervous traders poised to...   (Associated Press)
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(Newser) – OPEC’s decision yesterday not to boost oil production, despite prices hovering around $90 a barrel, underscores a new reality, the New York Times observes: the oil producers aim to keep prices nearly that high—say around $80 a barrel—a target unthinkable a few years ago. In the US, it means $3 a gallon at the gas pump isn’t going away any time soon.

The OPEC strategy is to find a price point that will pump as many petrodollars into members' coffers as possible, without sending the global economy into a recession. “OPEC’s floor price keeps rising,” said one economist. “You have to assume that’s a strategy.” Saudi Arabia had pushed for an increase of 500,000 barrels a day, but acceded to resistance from Venezuela, Iran, Qatar, and other members. The 13 members meet again in February.