Saudi Arabia will reportedly propose that OPEC cut production, driving up oil prices. Iran and Russia say they won't cooperate. Fred Katayama reports.
Oil prices rising on hopes that Saudi Arabia will propose that OPEC cut production. The newsletter Energy Intelligence reports that OPEC's largest oil producer will call for reducing output by 1 million barrels a day next year, but only if non-OPEC countries such as Russia and Mexico also cut production. The report comes one day before OPEC delegates meet in Vienna. A Saudi source dismissed the report as "baseless." And oil ministers from Iran and Russia said they won't cooperate. CIBC's Jeremy Stretch doesn't see any cuts coming: SOUNDBITE: JEREMY STRETCH, HEAD OF FOREIGN EXCHANGE STRATEGY, CIBC (ENGLISH) SAYING: "They will want to guarantee their market share, so that suggests that unless there are coordinated moves by the other OPEC members, then I think we will see production kept at current levels." That didn't stop investors from driving up the price of U.S. crude back above the $40 level. With prices plummeting more than 60 percent over the last 18 months, many oil rich countries are slammed with budget deficits. Barclays sees prices falling further. It cut its forecast for next year, predicting that OPEC countries will fail to agree on any production cuts.