(CBS) VIENNA – OPEC nations decided Friday to keep producing oil at their current high levels, effectively acknowledging their inability to push up crude prices.
An attempt to nudge the cost of oil higher would have involved lowering output. Instead, the organization’s endorsement of present output, which is more than 1.5 million barrels a day above the formal ceiling of 30 million barrels, is likely to push the price of oil down further.
The ministers of the Organization of the Petroleum Exporting Countries appeared to have little choice . Major producing nations in the cartel were opposed to reducing output. Instead, OPEC is poised to produce more oil.
Iran, which once pumped around 4 million barrels a day and is now down to about half that, is preparing to come back fully on line once it sheds nuclear-related sanctions in a few months.
Senior oil official Amir Hossein Zamaninia said last week Iran hopes to bring an extra 500,000 barrels on the market by early next year. He said he hopes the extra output will be accommodated within OPEC’s formal ceiling of 30 million barrels a day.
Arriving for Friday’s meeting, Iranian oil minister Bijan Namdar Zanganeh said Iran is ready to discuss a ceiling for its production — but only after his country makes a “full return to the market.”
Iraq is also resurgent. The country has seen the fastest rise in crude production in the world this year. It was pumping more than 4 million barrels a day last month and was responsible for last month’s biggest monthly rise in output among all OPEC countries.
And the ministers agreed to readmit past member Indonesia, to expand their ranks to 13. While that country’s production goes mostly for domestic consumption, that move could also add some to the total amount of OPEC barrels on sale.