World leaders continue to harass OPEC to cuts costs and increase production on crude oil as the price of crude dropped to just above $50 a barrel.
In response, the president of OPEC said oil production would be raised 500,000 barrels a day for the month of May with a decision from an OPEC meeting.
Kuwait’s energy minister Sheik Ahmed Fahd al-Ahmed al-Sabah said this is the first time an increase will be made without a decision from an OPEC meeting in order to guarantee a free flow of oil.
The G7 nations met and endorsed maintaining current and accurate information about the oil market, making it easier to adapt to changes in the oil prices. They also encouraging nations to save more oil and conserve their supplies. Light, sweet crude dropped to $50.32 a barrel and Brent crude dropped almost a dollar to $50.85 a barrel.
Bigger stockpiles and lowered demand have been the primary reason for falling prices although prices are still up considerably from last year, currently averaging $2.28 a gallon according to Businessweek.
U.S. Treasury Secretary John Snow said, “These energy prices are too high.”
Traders say it’s still to early to speculate on the price peaks for the year but expect prices to continue to drop could keep the pressure on for dropping prices. Gasoline supplies will also play a major role with Memorial Day swiftly approaching as it marks the launch of the summer travel season.
President Bush blames rising prices on increased demand from China.
John Stith is a staff writer for Murdok covering technology and business.
