Uh-Oh, I Don't Like The Sound Of This
Czar Putin is considering joining OPEC. That cannot be good:
The OPEC oil cartel is struggling to put a floor under plummeting oil prices, but even its largest production cut in history Wednesday failed to prevent prices from falling to a four-year low near $40 a barrel.
Oil producers are being squeezed so hard by the global recession that Russia, the world's second-largest producer, is flirting with joining the cartel - a move that only six months ago would have sent oil prices soaring to $200 a barrel, analysts say.
Countries like Russia and Venezuela that have to spend far more than $40 a barrel to extract oil, and which have ambitious social programs to fund with their oil revenues, have been hit particularly hard by the collapse in prices.
Russia, whose economy has been in a deep crisis since August, sent a delegation to the OPEC meeting to announce it is curbing output by 320,000 barrels a day - an amount that analysts said reflects the natural decline of production in fields where Russian oil companies have not kept up investments needed to maintain output.
Russian delegates said they have decided against joining the cartel for now.