``Voluntary'' reductions will be made on ``a member-by- member'' basis, Levi Ajuonuma, a spokesman for OPEC President Edmund Daukoru, said in a phone interview from Abuja, Nigeria. The oil ministry of Saudi Arabia, the largest oil producer in the Organization of Petroleum Exporting Countries, declined to comment on whether the kingdom will participate in the cut.
``I don't think we will see an effective cut of much more than 500,000 barrels,'' said Peter Beutel, president of Cameron Hanover Inc., a New Canaan, Connecticut, energy consultant. ``The Saudis have been quiet, which suggests that they aren't that interested in defending prices that are almost double the highest they've ever tried to defend.''
Crude oil for November delivery fell 91 cents, or 1.6 percent, to $57.61 a barrel at 1:53 p.m. on the New York Mercantile Exchange. Futures touched $57.55, the lowest since Feb. 16.
Prices are down 27 percent from the record of $78.40 reached July 14 amid concern that fighting in Lebanon between Israel and the Islamic militia Hezbollah, which is supported by Iran, would spread through the Middle East.
``I think you'll see $70 before you see $50,'' Boone Pickens, who oversees more than $4 billion at BP Capital LLC, said in an interview in New York today. ``It'll tighten up here in the fourth quarter and move back up, and we'll see $70 before the first of the year,'' Pickens said. ``I'm making decisions on that basis.''
OPEC Debate
The group is debating whether to implement the cut by trimming ``actual'' production as opposed to lowering its quota ceiling, Qatar's Oil Minister Abdullah bin Hamad al-Attiyah said in a telephone interview today. The 10 members with quotas pumped 27.63 million barrels a day last month, falling short of their 28 million barrel ceiling, according to Bloomberg data.
Nigeria and Venezuela have announced cuts totaling 170,000 barrels a day. The countries produced 470,000 barrels less than their combined quota in September, according to Bloomberg News data. Nigerian output has fallen because of militant attacks and sabotage. Venezuela has diverted funds from the state oil company and broken contracts with other companies operating there.
``It looks like a scheme by Venezuela and Nigeria to get other producers to cut output,'' Beutel said. ``They can't even meet their quota so it would be in their interest to see others cut back and have higher prices.''
Production Target
The 11 members of OPEC, which produce about 40 percent of world oil, kept their output target at 28 million barrels a day at their Sept. 11 meeting. OPEC's next scheduled meeting is on Dec. 14 in Abuja, Nigeria.
``The persistent headlines about OPEC making a cut suggest that they will eventually deliver on one,'' said Tim Evans, an energy analyst at Citigroup Global Markets Inc. in New York. ``The size of the price move lower begs for some kind of action by OPEC.''
U.S. Energy Secretary Samuel Bodman plans to speak with OPEC members as soon as this week to discuss the group's plan to cut output. Bodman also said he has encouraged OPEC and non-OPEC producers to pump ``significant quantities'' of oil.
``As time goes on, late this week, early next week, I would hopefully be in touch with various ministers to talk about markets,'' Bodman said today in an interview. Bodman said he will seek ``first to understand exactly what happened and what the situation is.''
Global Demand
The International Energy Agency cut its estimates for global oil demand this year and next for a second consecutive month, citing the effect of high prices and slowing U.S. economic growth. World oil demand will be 84.57 million barrels a day this year, 110,000 barrels a day fewer than estimated last month, the Paris-based agency said today in its monthly Oil Market Report.
The agency, which represents 25 industrialized countries, lowered its 2007 consumption estimate by 200,000 barrels a day to 86.02 million. The increases will be driven by China, the second- biggest consumer, with gains of 6.4 percent this year and 5.5 percent in 2007.
World oil demand is now expected to rise 1.2 percent this year and 1.7 percent in 2007. In January, the IEA forecast world consumption would expand 2.2 percent this year.
Brent crude oil for November declined 46 cents, or 0.8 percent, to $58.88 a barrel on the London-based ICE Futures exchange.
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