Oil prices climb ahead of OPEC meeting
Oil prices climb ahead of OPEC meeting
Agence France-Presse, London
Oil prices pushed upwards again on Friday ahead of a meeting of the Organisation of Petroleum Exporting Countries (OPEC) cartel next week to discuss whether to cut output to prop up the market in anticipation of a season decline in demand.
The price of a barrel of reference Brent North Sea crude oil for March delivery climbed 16 U.S. cents to US$29.43 in early trading here.
New York's benchmark light sweet crude March contract gained 25 cents to $33.33 per barrel in pre-opening electronic deals.
Traders were looking ahead to a meeting of the OPEC in Algiers on Tuesday.
"People have got their eyes pretty much fixed on OPEC," said GNI trader Lee Elliott.
"We still have no comments from OPEC although we are looking for 'unchanged' on Tuesday. But people are pretty worried that OPEC ministers will come out in the next few days and mention the idea of cutting production," he added.
Most analysts forecast that OPEC is to maintain its output quotas, currently fixed at 24.5 million barrels per day, at the meeting in the Algerian capital, and postpone any change until a scheduled meeting at the end of March.
But the grouping has surprised markets before and analysts say OPEC is concerned about a possible slide in prices as winter thaws in the northern hemisphere.
The price of the OPEC basket of seven crudes stood at $28.20 a barrel on Thursday, the cartel's own news agency OPECNA reported, above the organisation's declared target range of $22-$28 dollars per barrel.
But there appears little prospect of OPEC opening up the taps any more.
Algerian Energy Minister Chakib Khelil said Thursday that if OPEC decided to increase oil production next week, "we will see a rapid decline in prices".
Khelil, speaking in an interview with OPECNA, said he was not sure the members of the OPEC were capable of easily increasing production, even if they wanted to.
And he also hinted that the cartel was reluctant to leave output unchanged for long.
"If production is maintained at the same level, there has to be a decrease in prices, and nobody knows how far down the price is going to go," he said.