News that China's once-insatiable appetite for oil has dropped dramatically add further weight to the suggestions that Opec will this week slash production, it has been reported.
It had previously been suggested that the group of oil producing nations would cut production this week by up to two million barrels per day, in order to prevent a stockpile of oil growing, and with China buying progressively less oil, this prediction is increasingly beginning to make more sense.
The proposed cut in oil production would not likely raise prices initially, but rather clear a stockpile of oil which has been accruing, but further or more dramatic cuts could have a serious impact on businesses with international supply chains.
Abdullah al-Badri, the secretary-general of Opec, said in a Times report: "We have to act, we see a very sizeable reduction. The market is oversupplied with oil."
Large or international supply chains are left highly exposed to shifts in the price of oil, as shipping costs will count for a high proportion of the production of such companies' goods.
Such companies could, as a result, benefit greatly from appointing a supply chain management company to take care of the delivery and logistics of production.
Reassessing a supply chain to cut costs could include bringing the sources of production closer to the UK, or finding more cost-effective ways of shipping goods.
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