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Kuwaiti Oil Minister Sheikh Ali Jarrah al-Sabah said Oct. 4 that his country might follow Venezuela and Nigeria in cutting crude oil production to boost prices. Al-Sabah recently said that Organization of the Petroleum Exporting Countries (OPEC) members want price stability around $60 a barrel. If prices fell to $50 a barrel or below, he said, producers would be concerned.
Venezuela and Nigeria did not shock the markets by cutting their production, since both already are producing below-quota. However, the Kuwaiti statement carries more weight. Kuwait is the third-largest crude producer in OPEC, behind Saudi Arabia and Iran. As of August 2006, it was producing 2.6 million barrels per day (bpd) -- 400,000 barrels more than its OPEC-assigned 2.2 million bpd quota. Hence, Kuwait can afford to act on its threat to cut production.
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