Drama surrounds OPEC meeting during which oil production levels will be decided

The price of oil is dictated by a number of factors, with the amount of production that the Organization of Petroleum Exporting Countries (OPEC) decide upon leading to price swings. The agency will meet this week to set quotas, but the ongoing situation in Libya is complicating matters, Bloomberg reports.

According to the news source, not since Saddam Hussein invaded in Kuwait in 1990 has OPEC gathered when some of its member nations were giving support to the overthrow of a fellow member nation. While autocratic leader Muamar Gadhafi has thus far avoided capture by NATO troops, the country still holds the largest crude reserves in all of Africa.

Qatar, Kuwait and the United Arab Emirates are supporting NATO troops in their attempts to oust Gadhafi, and industry watchers are debating what will happen when OPEC nations meet this week to set their oil producing goals. Currently, member nations represent about 40 percent of the entire world's output of crude oil.

Crude oil futures have gained nearly 10 percent in value this year on economic and political instability coursing through the Middle East and North Africa. A survey of 30 analysts conducted between May 23 through May 31 concluded that OPEC nations will likely keep their output target unchanged when they meet on June 8.

Still, fighting in Libya has blocked more than 1.4 million barrels of crude oil production per day from reaching world markets. While the U.S. doesn't depend on Libya for oil, European nations do, and the slowdown in oil shipments is affecting gas prices there where they have been steadily creeping up since the beginning of this year.

On the New York Mercantile Exchange on Monday, crude oil futures declined by 1.2 percent to settle at $99.01 per barrel.

Analysts affirm that oil shipments from Libya could be halted for months because of damage inflicted to oil facilities and international sanctions levied on the country. Libya is still discussing whether it will send a representative to the OPEC meeting on June 8, according to the news source, citing Jalal el-Gallal, a spokseman for the rebels' National Transitional Council, which supports Gadhafi.

Surging oil prices are largely responsible for the slowdown in the global economy, according to industry watchers. Not only are they affecting consumers' ability to move around, but they are also increasing business costs as higher transportation costs eat into profit margins. Soon, a spate of consumer products are likely to cost more, the Strategic Sourceror has reported.