>> 14>> Oil price is plummeting, Thursday, after tanking a day earlier, making it the biggest two-day drop in more than a year. The reason for the huge move lower, too much oil. Record US crude stock piles pointing to a world wide surplus of oil despite efforts by OPEC.
The organization of the petroleum exporting countries to slash supply, leaving investors to question the effectiveness of the cuts. Reuters energy correspondent, Ernie Scheider is in Houston for CERAWeek, a gathering of OPEC ministers and executives from the world's largest oil companies.>> This week a lot of the tension has been between US shale, oil and natural gas producers and those OPEC member nations.
They came together this week and had several private meetings. But each side, while they got to know each other a little better, haven't come exactly to an understanding. A lot of the US shale producers have taken the recent increase in oil prices in the past few months as a sign that they can boost production, much to OPEC's chagrin.
But the US producers might be shooting themselves in the foot. Stockpile data released by the US Energy Information Administration this week showed a large gain. That's pushing oil prices sharply down today, below $50 per barrel. Now that's the lowest price they've been this year. That's creating even more tension between US producers and OPEC which is trying to control the price with curbs of its own.
>> But they'll need to act fast because low oil prices only encourage some producers to increase output to balance their budgets. The two-day drop leading one oil analyst to say that if things stay the way they are, then this week will be the worst week for oil prices since the OPEC deal to cut supply in November.