OPEC: Forging a Fragile Peace

Forging a Fragile Peace

Like other OPEC pacts, the truce came after days of heated negotiations. And like other OPEC pacts, it may prove ephemeral. Iranian Oil Minister Gholamreza Aqazadeh broke a deadlock when he tentatively gave in to Iraqi Minister Isam Raheem al-Chalabi's demand for a quota equal to Iran's 2.6 million bbl. a day. To accommodate the 1 million bbl. increase in Iraq's quota, other OPEC members gave up a bit of their own allowances.

Iran's acquiescence may enable the group, which has suffered from sagging prices, to cut output to 18.5 million bbl, a day from its current runaway level of about...

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