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Energy

OPEC Tells West To Kiss Off, Raise Recession Risk

Photo of Douglas A. McIntyre
By Douglas A. McIntyre Published
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There will be no lower oil price in consumer stockings for Christmas.

In an interview with the Financial Times, Ali Naimi, the Saudi oil minister, said “there will be absolutely no discussion” by heads of states or their oil ministers on short-term supply and demand at the organisation’s summit.

And Reuters writes OPEC President Mohammed bin Dhaen al-Hamli said on Tuesday the group would take its next decision on output policy in December, further dampening hopes of a surprise production increase at this week’s OPEC summit.

The announcements will pinch big oil consuming nations, especially the US and China.

There is little talk of the Chinese economy slowing its 10% per annum expansion, but if oil stays above $90 a barrel, that could change. The government now underwrites relatively low gas and diesel prices through its big state-owned oil companies. But, it is not clear how long the delta between real prices and artificial support can work.

In the US, gas prices are now likely to be above $4 a gallon for some time. And, the holiday travel period is coming.

A cold winter across the US, China, and Europe could also be a large driver of demand.

OPEC wants the West to cut back on nuclear and bio-fuel development to make sure oil prices stay high for the next two decades.

The cartel may get its wish.

Douglas A. McIntyre

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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