Answer to Question #64252 in Microeconomics for reyuf

Question

Consider the continuous decline in oil price that has hit most of the oil producing economy across the globe, and members of Organization of Petroleum Exporting Countries (OPEC) will be having their meeting by 15th December 2016. As an economic expert, kindly advice OPEC on what needs to be done in order to reverse the continuous decrease in oil price (Note: Support your answer with the required graph)?

Answer 1

I think, in order to stop the continuous price reduction is necessary to conduct some activities that affect the level of oil prices. First, OPEC should set a certain level of oil to produce, over which member of OPEC have no right of mine. This decision will help stabilize oil prices. Also, OPEC should hold a meeting with countries such as the USA, Russia and Venezuela that produce large reserves of oil, and consider the price of oil on them.