Crude oil keeps on falling. The prices plummeted once in light of a report, which showed that crude oil inventories had increased. The analysts say that inventories have been growing steadily despite low oil prices on the global market. The OPEC Basket price dropped to the lowest level in six years below $40 per barrel. The average price of oil produced by OPEC countries declined to $39.21 per barrel. As a result, “OPEC’s annual revenues may be curbed to $550 billion at current prices from an average of more than $1 trillion in the last five years,” Executive Director of the International Energy Agency Fatih Birol said. Besides, the price was pushed down by a reported increase in crude oil inventories in North America and by sluggish growth of Asian economies. OPEC member Ecuador's oil minister said that the only way to balance the market is to cut production and he will try to reach an agreement on this question at the group's December meeting. The current situation is reflecting the fears that China is going to be experiencing a decline in external demand which may become a serious challenge for the largest Asian economy. However, there is some positive news for OPEC. The experts forecast that oil producers will have to cut their expenses by $200 billion in 2016 in the context of low prices. This will inevitably lead to cuts in oil production by non-OPEC countries.
