ABSTRACT
After a long and extremely arduous series of meetings, beginning with three weeks of negotiations and ending with twelve days of nearly non-stop discussions that nearly exhausted their energies, the OPEC ministers reached agreement in the second week of March 1983 on both the allocation of production and the price of crude oil. An overall ceiling of 17.4 million barrels a day for 1983 was established with the allocation among all but one of the OPEC members of individual production quotas; Saudi Arabai accepted, in the role of “swing” producer, to supply the balance within the overall ceiling between market requirements and the quotas of other members. On the assumption that market demand would permit 17.4m b/d, the implicit Saudi “quota” would be about 4m b/d. All members agreed to accept a price for the “marker” cruder of $29/b, a reduction of $5/b from the earlier price, with differentials for crudes from different sources and of different qualities to be the same as those agreed in March 1982 (with the exception of a “temporary” price for Nigeria to permit it to recoup some of its losses in competition with North Sea crude). Members accepted a number of provisions intended to ensure that neither direct nor indirect discounting off the officially agreed prices would occur.
