By Sarah Kent
LONDON--The average price of oil produced by members of the
Organization of the Petroleum Exporting Countries fell to a
four-year low on Tuesday, as news that Saudi Arabia had cut the
price of its oil for U.S. buyers triggered a rout in oil
prices.
OPEC's daily basket tumbled to $78.67 a barrel, down almost $2 a
barrel from Monday, according to data published by the Secretariat
on Wednesday. That level hasn't been touched since October
2010.
It reflects a drop of more than 20% from the average price of
$101.58 a barrel so far this year, underscoring the pain facing
OPEC members dependent on oil exports for government revenue.
Notwithstanding the steep drop in oil prices, OPEC kingpin Saudi
Arabia has so far declined to rein in production, highlighting
rifts within the group which has historically cut back output to
prop up prices.
Saudi Oil Minister Ali al-Naimi is scheduled to meet with
Venezuela's Foreign Minister Rafael Ramirez on the Caribbean resort
island of Margarita on Wednesday as the South American nation
struggles to endure the sustained drop in prices.
Write to Sarah Kent at sarah.kent@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires