Council on Foreign Relations

OPEC, the Organization of the Petroleum Exporting Countries, announced in meetings today that it will not increase global oil output (Bloomberg), jolting traders who had speculated all week over a possible 500,000 barrels-per-day increase. The decision comes in the face of pressure from major oil consumers, led by the United States, who had pressured OPEC for an increase in production. Speaking for the bloc, Algeria’s finance minister said OPEC would raise production if there was not enough oil to meet global demand, but said that is not currently the case (Reuters).

The Financial Times says the announcement reflects a victory for OPEC’s “price hawks”—led by Algeria and Venezuela—and says Saudi Arabia and Kuwait worked behind the scenes to calm concerns that oil prices might again spike, as they did last month. The price of oil, which had dropped considerably over the last week, jumped today (AP) on OPEC’s announcement.

In a recent article, CFR’s Brad W. Setser argues for increased exchange rate flexibility in many of the world’s biggest oil exporters, noting the distorting effects of currencies pegged to the dollar.

Following the December 3 National Intelligence Estimate, which marked a sharp U-turn on Iran intelligence, policymakers are reconsidering the most appropriate path forward. Iran’s President Mahmoud Ahmadinejad declared the report a victory for Iran, and the Iranian news source Press TV said it “ends enemies’ dreams.” U.S. President George W. Bush insisted that the report does little to mitigate the danger that Iran still poses (NPR) of becoming a nuclear power.

In a new Foreign Affairs article, two CFR fellows, Ray Takeyh and Vali Nasr, argue that a policy aimed at containing Iran won’t work. In an interview yesterday with CFR.org, Takeyh notes that Iran still has “a vast and growing civilian nuclear program” that could “easily converted for military purposes.”

Lebanon-Iraq: A new report from Human Rights Watch argues that Iraqi refugees in Lebanon face dire circumstances due to Beirut’s failure to assign them a legal status. In many cases, the report says, refugees face the threat of arrest or are simply forced to return to Iraq.

Iraq: U.S. Defense Secretary Robert Gates made an unannounced trip (AP) to Iraq today in an effort to gauge whether reductions in violence can be sustained with fewer troops.

The Power and Interest News Report has a new paper examining China’s decision to deny U.S. ships access to the Port of Hong Kong.

Japan: The Economist has a special report on business in Japan, arguing that some Japanese companies are showing signs of modest recovery after fifteen years of sustained troubles.

South Korea: The frontrunner in South Korea’s presidential campaign was cleared (Korea Times) of a series of allegations of financial misdoings, though his opponents decried the trial as biased.

Newsweek International examines the limited coalition Pakistan’s former prime ministers Benazir Bhutto and Nawaz Sharif appear to have formed, but questions whether the two stand much of a chance of swaying the country’s President Pervez Musharraf ahead of January elections.

In a statement written for PostGlobal, Musharraf defends his recent crackdown and says discussion surrounding upcoming elections must “move beyond personalities to debate a vision for Pakistan.

India: A coalition of Indian leftists walked out of parliament in protest of aspects of a proposed U.S.-Indian nuclear deal. The Times of India writes that government efforts to pacify opponents of the deal have failed to calm criticisms.

Government troops from the Democratic Republic of Congo infiltrated a rebel stronghold and seized a strategic base (BBC).

Ethiopia-Eritrea: An Economist Intelligence Unit briefing examines the simmering conflict between Ethiopia and Eritrea.

In an interview with CFR.org, Ethiopia’s ambassador to the United States argues that western fears about the conflict are overblown.

Weather: The Christian Science Monitor looks at new efforts to improve information-sharing between U.S. satellite operators and African nations. The initiative aims to improve natural disaster planning on the continent.

The U.S. Supreme Court hears arguments (AP) today over the legality of some indefinite detentions of terror suspects at the U.S. naval base at Guantanamo Bay. The court will consider whether suspects held as “enemy combatants” have a right to contest their detention through the U.S. court system.

Mexico: NPR’s “All Things Considered” examines Mexico’s intermediary role as Hollywood seeks to export more of its films to Latin America. The vast majority of these films are processed for Spanish-speaking audiences in Mexico, where they are dubbed and repackaged.

Venezuela: The Latin Business Chronicle examines Venezuela’s prospects for business growth following a referendum vote against President Hugo Chavez’s proposed constitutional changes. The journal concludes that nothing substantive has happened to change its prior negative outlook.

None of the presidential candidates in Senate participated in yesterday's vote to pass the free trade act with Peru. Sen. Joe Biden (D-DE) released a statement opposing the bill, because, he said, “the Bush Administration has not proven that it will effectively enforce labor and environmental provisions, however good they may be.”

John Edwards, who has been an outspoken opponent of the Peru FTA, said he was “disappointed” by the bill’s passage. The agreement is “an example of how corporate interests and their lobbyists and cronies have corrupted the Democratic Party,” he said.

Iran : Republican candidate Mike Huckabee raised eyebrows yesterday when he said he was unaware of the NIE on Iran (ChiTrib).

The International Herald Tribune reports that European officials are beginning to take a tougher stance toward the declining dollar, which they see eating away at their exports.

Latvia: Latvia’s prime minister and his cabinet resigned today following a series of scandals that had triggered major protests. A new government has yet to form, but the BBC says many of the same players are likely to remain in power.

France-Russia: The Financial Times examines French President Nicolas Sarkozy’s decision to congratulate Russian President Vladimir Putin over his party’s victory in widely criticized parliamentary elections. The article notes that Sarkozy’s words jarred other European leaders, who had taken a chillier stance toward Putin’s victory.