OPEC Says Goodbye to $100 Oil

The head of the world’s oil cartel made an unusual concession Friday: $100 oil is a thing of the past.

At its semi-annual meeting, the Organization of the Petroleum Exporting Countries chose to maintain its current production ceiling of 30 million barrels a day. It was the second time OPEC passed on cutting its output amid weak oil prices.

Abdullah el-Badri, OPEC’s secretary general, told reporters in Vienna that U.S. shale oil—a prime catalyst for oil’s slump—is here to stay, according to Dow Jones Newswires.

“The reality is we can’t have oil at $100 [a barrel] anymore,” el-Badri said.

OPEC is responsible for one out of every three barrels of oil consumed each day, yet the cartel has lost much of its influence over global oil prices.

Prices remained fairly steady following OPEC’s meeting. Brent crude, the international benchmark, slipped 10 cents to $62.59 Friday morning. Nymex WTI oil was trading four cents lower at $57.96.

DTN senior analyst Darin Newsom said the news out of Vienna “shouldn’t have much of an effect on the market.”

“The recent highs seem to be running out of steam. You can basically say we’re in a holding pattern with the market wanting to turn lower anyway,” Newsom added.

Nymex WTI touched recent highs above $62 a barrel in early May, surpassing the $60 mark for the first time this year.

U.S. production has contributed to the oil glut that’s weighing on global prices. Thanks to shale plays like North Dakota’s Bakken and Eagle Ford in Texas, America is now the world’s largest producer of petroleum and natural gas.

OPEC, which includes nations such as Saudi Arabia and Venezuela, traditionally scales back production in an effort to boost the price of oil. But in December, months after oil began to slide on concerns of an oversupply, OPEC sent another shock through the market by taking no action.

While $100-a-barrel oil is seen as OPEC’s preferred price, el-Badri said OPEC has no target.

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