Can OPEC keep prices from falling further?

The next meeting of the Organisation of the Petroleum Exporting Countries (OPEC), on 27^th November, should be the most interesting since the change from individual quotas to a group target in early 2012. The recent sharp fall in oil prices has increased speculation that the cartel will cut its output target in an effort to boost prices. However, most comments from OPEC ministers seem sanguine and it is not clear that even if they did cut their production target, actual output would fall. What’s more, we think that any cut in the cartel’s output target will simply be a response to lower demand for the group’s oil, rather than a serious attempt to drive up prices.