OPEC IN A CLEFT STICK.

Oil like most commodities is demand driven and not supply driven as OPEC and company are finding out the hard way. All oil producing countries have reached a point where they need a minimum of huge oil revenues to keep their economies above water. If they sell less oil they earn less which may be below this base level. Therefore, they cannot keep cutting back on production as demand falls globally that will result in lower quantum of their oil revenues which is never enough. In any case, most oil producers as a rule exceed their quotas as they sell their produce "surreptitiously" of which all are aware.

As the severe economic downturn is worldwide, consuming countries will be forced to keep their oil consumption to stringent levels if the price of oil rises. Russia which had become a non-entity in world politics during the time of Boris Yeltsin because of economic bankruptcy has now once again begun to flex its muscles in the international arena due to its buoyant economic strength which is almost solely oil revenue driven. Recently Russia had even surpassed Saudi Arabia as the highest exporter of oil for a short period. It will be foolish of them to join up with OPEC's plans of reducing oil supplies at the cost of oil revenues on which they are so dependent. Further, with the vested interests from the US Texas oil lobby having been voted out of power, the global oil scenario will be very much different once Barack Obama takes over. Above all, this century’s energy needs will be more natural gas driven than oil driven, both due to environmental concerns as well as the dwindling supplies of crude oil which will be soon running out in a few decades from now.