The Organization of Petroleum Exporting Countries warned Wednesday that the global oil market could face a debilitating price war unless rival producers, led by Russia and Mexico, showed greater cooperation in curtailing output to help shore up sagging prices.
An emergency meeting of OPEC ministers at the cartel's headquarters in Vienna broke up with a promise to trim production by 1.5-million barrels a day in January, but only if Russia and other non-OPEC oil powers shared the burden by removing an extra 500,000 barrels a day from the market.
"I'm afraid that this cut without (non-OPEC producers) will not help," said Qatar's oil minister Abdullah Attiyah. "It will be useless and then I'm afraid that this will push us to enter a price war and it will be a disaster for everybody."
With the slumping global economy showing no signs of a quick recovery, oil prices have been dropping steadily as demand among consumer countries continues to shrink. Since the Sept. 11 attacks in New York and Washington, prices have dropped below $20 a barrel after briefly spiking up to $31 amid fears of war and political instability in the Persian Gulf region.
December contracts for North Sea Brent crude fell $2.06 Wednesday to close at $18.75 a barrel in trading on the International Petroleum Exchange in London. Light, sweet crude for December delivery was $1.93 lower to close at $19.74 in trading on the New York Mercantile Exchange.
The 11 OPEC members, which control about 60 percent of the world's oil trade, have already reduced production this year in a futile bid to keep prices within a target range of $22 to $28 a barrel. But their policy of cutbacks has been foiled by rival producers who have seized the opportunity to gain market share and enhance income at OPEC's expense.
The refusal by Russia, Mexico and Norway to sacrifice production has frustrated the cartel's members, who declared that unrestrained output could quickly drive prices to as low as $10 a barrel _ a level that could prove ruinous to their economies.
Norway and Mexico have refused OPEC's pleas to cut output partly out of sympathy with the view among some consumer countries that oil prices should fall further to boost prospects for a global economic recovery. Russia, the world's second-biggest oil exporter, has offered only a token cut.
_ Information from the Associated Press was used in this report.