Opec, the cartel of oil producing nations, confirmed yesterday (December 17th) that it will indeed cut production of oil by 2.2 million barrels per day.
The production cuts were designed to create a hike in oil prices to counter the severe falls in price in recent months.
However, the cuts only served to highlight the gloomy outlook for the economy, leading to a further six per cent fall in the price of a barrel.
Although the drop in prices represents a great deal for those managing large supply chains there is no doubt that the general volatility of oil prices will be unwelcome among those running a business.
Speaking in a Guardian report, Gary Ross, CEO of consultancy Pira Energy, said: "The world economy is driving the price more than anything Opec can do at this stage.
"It will be hard for the cuts to have any traction with regard to price in a deteriorating economic environment."
Supply chain management companies can work to reduce a company's exposure to such volatility by reassessing the make-up of a supply chain.
Manufacturing and Industrial:
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