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Market nervous about OPEC'S latest output cut
The oil market exhibited nervousness entering 2002 over concerns about whether OPEC will be able to enforce its Dec. 28 announcement to reduce production quotas by 1.5 million b/d for the next 6 months.
The agreement reached in Cairo means OPEC, with 60% of the world oil export market, reduced production by 6.5% starting Jan. 1.
Russia, Norway, Mexico, Oman, and Angola have also pledged production or export reductions totaling 462,500 b/d. OPEC initially stipulated that non-OPEC producers had to reduce oil output by 500,000 b/d before it would again roll back its production quotas.
OPEC's emergency meeting in Cairo marked the group's record seventh gathering in a year, surpassing 1974 when the group was coordinating an oil boycott after the 1973 Arab-Israeli war. Last month, most members of the cartel were in Cairo for a meeting of the Organization of Arab Petroleum Exporting Countries. An official OPEC ministerial meeting is slated in March in Vienna.