By Peg Mackey and Michael Georgy
VIENNA (Reuters) - An emergency OPEC meeting on Friday was expected to cut production by at least a million barrels per day as a first step towards halting a deep price slide.
International benchmark U.S. crude has slumped by more than 50 percent from a record high of $147.27 hit in July. On Friday it was trading around $67 a barrel.
OPEC ministers have said they have to balance their own needs with those of the wider economy and have so far disagreed over the size of any cut.
The core Gulf producers, which have relatively low price requirements and are nervous about further destruction of demand in consumer countries, would prefer a relatively modest cut, delegates have said.
Venezuela, Iran and Libya have all favoured a deeper output reduction at the formal session of the Organisation of the Petroleum Exporting Countries, expected to start at around 9 a.m. (8 a.m. British time).
An OPEC delegate told Reuters on Friday the group was considering two supply cut options. It could cut by one million barrels per day (bpd) now and review the situation at its next planned meeting in December.
Alternatively, it could cut 1.5 million bpd immediately, the delegate said.
On arriving in Vienna, Saudi Arabian Oil Minister Ali al-Naimi said on Thursday that the oil price would be determined by the market. He would not be drawn on the need for any cut.
Saudi-owned newspaper al-Hayat quoted an OPEC source as saying OPEC was expected to cut output by around a million bpd.
SAUDI SETS THE PACE
The only OPEC producer to be pumping significantly above its official output target, Saudi Arabia would be expected to lead any reduction in supplies.
When prices were racing towards their July record, Saudi Arabia unilaterally increased output to try to calm a rally, which was perceived as out of control.
It has since reduced its production slightly as global economic recession has weakened demand, fuel stocks have swollen and the oil price has dropped rapidly, reviving bad memories for OPEC of the 1998 price crash when the market fell below $10.
Venezuelan Minister of Energy and Petroleum Rafael Ramirez said there was a risk oil could fall back to that level and OPEC needed to act without delay.
"We have to handle the situation in a very, very responsible manner as OPEC.... that way we can avoid a price collapse like 1998," he said.
OPEC President Chakib Khelil of Algeria was among those who said it could take more than one meeting to strike the right balance between supply and demand and between producer and consumer needs.
"The concern of the producing countries is, whatever decision is made, not to have an impact on increasing the pain of consuming countries," Khelil said.
"The decision should not leave the producer countries in the situation where they will be joining the group of countries which are already suffering from the financial crisis."
(Additional reporting by Sylvia Westall, Luke Pachymuthu and Rania El Gamal; writing by Barbara Lewis, editing by William Hardy)
