Oil Falls Despite Production Cuts (BBC)

Created by : Airlight View profile

Trading Floor

World oil prices have continued to fall, undermining oil cartel Opec's efforts to steady prices by cutting output by 1.5 million barrels a day.

The decision to cut about 5% of the cartel's total daily output came after an emergency Opec meeting in Vienna. {xtypo_quote_right} Iran relies almost entirely on its oil exports for government revenue: for every dollar off the price of a barrel of oil, the country loses roughly $1bn a year in revenue. But British Prime Minister Gordon Brown warned that any reduction made in a bid to push up oil prices would be "scandalous" at a time when major economies were close to tipping into recession. {/xtypo_quote_right}

But the move did not halt the sliding oil price, with US sweet light crude shed $4.80 to $63.04. London Brent dropped $4.42 at $61.50.

Recession fears have pulled oil down from a high of $147 a barrel in July.