Even with less drilling, U.S. oil production next year should help keep world markets awash in crude and that may prompt OPEC action by the middle of next year, analysts say.
Saudi Arabia reportedly sees $60 as the level where prices will stabilize, after OPEC last week opted not to cut its production quota. U.S. oil futures Friday closed at $65.84 per barrel, the lowest since 2009 and nearly 40 percent off its June high. Brent was just under $69 per barrel, and both had been trading lower after reports Saudi Aramco cut its January prices to Asia and the U.S.
"The problem for OPEC is if they don't blink. And let's say they do shut down the rate of production growth in the U.S., and they get a price back to where they like it to be, U.S. production growth starts again," said Edward Morse, head of global commodities research at Citigroup.