Oil prices hold in Asia after hitting new highs
Oil prices hold in Asia after hitting new highs
SINGAPORE (Reuters): Crude oil prices in Asia were holding
most of the overnight gains on Tuesday after hitting new highs in
London and New York markets.
Traders said oil market sentiment was firm following the
latest indication that OPEC was keeping a tight rein on crude
production and that further out world oil demand was set to
accelerate sharply.
The September U.S. light crude futures contract trading on the
electronic ACCESS system in Asia was down seven cents per barrel
at $21.20 at 0900 GMT.
In New York trading on Monday, the contract rose as high as
$21.30 and ended the day at $21.27 -- the highest settlement
since October 1997.
On the Singapore International Monetary Exchange (SIMEX),
September Brent was down five cents at $20.45.
September Brent on London's International Petroleum Exchange
(IPE) had closed at a 22-month high of $20.50, 44 cents higher
than the previous day's close.
The International Energy Agency said earlier on Tuesday that
OPEC's compliance with its production cuts was 91 percent in July
from 87 percent in June.
That reinforced the view that OPEC discipline was being
maintained after it decided to cut production sharply through
until next March.
On Monday, Venezuelan Energy and Mines Minister Ali Rodriguez
said he did not expect any change in OPEC's production policy
when the group meets next month.
The IEA's latest report said that while OPEC was implementing
almost all of its stated cuts, the outlook for the cartel was
rosy in 2000.
It said world demand was set to grow 1.8 million barrels per
day to 77 million in 2000, double the 900,000 bpd in 1999.
But it said the call on OPEC crude would jump to 28.9 million
bpd in 2000 compared with current output of just over 26 million
bpd.
The U.S. Energy Information Agency (EIA) had said on Friday
that it was raising its forecasts for world oil prices for this
year and next because of the better than expected compliance by
OPEC to its pledged output cuts.