It's too early to say if a decision by OPEC to cut oil production for the first time in eight years will affect Olds, according to Olds & District Chamber of Commerce vice-president Ben Stone.
OPEC is the Organization of Petroleum Exporting Countries -- a cartel designed to keep oil prices up. The group reached the surprise agreement last week.
Analysts say what might make this agreement work when others haven't is that this time non-OPEC oil-producing countries like Russia have also agreed to cut production. A committee will be formed to monitor compliance.
Initially, oil prices jumped as much as 10 per cent to around US$50 per barrel as a result of the news.
“I don't think that this is the turning point, personally,” Stone said.
“OPEC is notorious for making statements like this in order to boost prices short term.
“We saw the exact same thing – I think it was in September – and oil jumped – it went to about $52 (a barrel).
“Then as the months went on, reports started coming out about Iran backing out and people being less than satisfied with the arrangement. From there I think oil went back down to $45 and here we are now,” he added.
“I think that when the oil market stops reacting to these announcements, I guess that's when I think we'll actually start to see some change implemented, some actual cutbacks. But it is encouraging.”
"I don't think that this is the turning point, personally. OPEC is notorious for making statements like this in order to boost prices short term."BEN STONE VICE-PRESIDENTOLDS & DISTRICT CHAMBER OF COMMERCE
