Venezuela President Hugo Chavez said on Wednesday a "fair" price of a barrel of oil would be between $70 and $90 per barrel, as OPEC ministers met to slash global oil supply. | And if the markets aren't paying his 'fair' price that is justification for revolutionary acts. Expect things to get even worse for business owners and conservatives in Venezuela. |
Wonder what he's charging Joe Kennedy this year?
OPEC oil ministers, including from Venezuela, were meeting in Algeria on Wednesday to remove a record 2 million barrels per day from oil markets in a race to balance supply with the world's rapidly crumbling demand for fuel due to a global economic slowdown.
As the ministers convened a meeting which was expected to proceed smoothly, oil was trading just above $44 a barrel.
Saudi Arabia, the world's biggest oil exporter, has led by example -- reducing supplies to customers even before a cut has been agreed to help push prices back toward the $75 level Saudi King Abdullah has identified as "fair."
Venezuela's finance minister, Ali Rodriguez, backed the Saudi view. "The Saudis are talking about $75. We agree with something around that price," he told reporters. Venezuela's budget for next year is based on oil prices fetching $60. "At current levels, we would have to cut government expenditures," Rodriguez added.
Oil below $50 is uncomfortable for all producing nations, but especially for OPEC members Venezuela and Iran which depend on high prices to fund their ambitious domestic programs.