OPEC cuts oil production

The total production adds up to about 3% of total output, which OPEC believes will drive prices back up over $75 a barrel. The economic downtown has meant a reduction in consumption, even a crude oil glut. This analyst says the reduction in output is a significant gamble especially for large oil producers like Saudi Arabia. This analyst says the Saudis can weather this without too much difficulty, but it’ll be tougher for the Iranians. He says this is as much a political move as an economic one. That kind of hardball could have ramifications on ordinary folk because many of the oil rich nations rely on outside workers and those workers prop up the economies of their home countries, so remittances will go down in places like Egypt. Many analysts believe that these Middle East countries won’t be able to prop up their social welfare programs as well.