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Oil price volatile due to OPEC’s ambiguity. The market was in disarray earlier last month following a rumor that OPEC supposedly was to hold an urgent meeting before its extraordinary November 14 date. However, trading stabilized after OPEC’s Secretary General Ali Rodriguez dismissed reports that the group planned to hold an emergency meeting to discuss slumping crude prices. Analysts claim that oil prices have slumped by about 20% since the September 11 attacks on the U.S. OPEC’s President, Algerian oil minister Chakib Khelil said, despite falling prices, the oil cartel is reluctant to cut output before any U.S. military action which could have a major impact on prices. Under a price-stability mechanism, the cartel can instigate a 500,000-bpd supply cut if oil prices remain below the $22 – 28 target range. Output cuts to date total 3.5 million bopd.
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