Oil rises, as OPEC may delay output hike

Oil rises, as OPEC may delay output hike

Agence France-Presse, London

Oil prices rose on Monday amid increasing signs that the Organization of Petroleum Exporting Countries (OPEC) could hold back on a planned production hike next month.

The price of reference Brent North Sea crude oil for delivery in August climbed 41 U.S. cents to US$36.33 per barrel in early deals in London.

New York's benchmark contract, light sweet crude for August delivery, was closed because of a long weekend following American Independence Day on Sunday.

The contract had closed down 35 U.S.cents at $38.38 on Friday as traders locked away profits from a two-day surge in prices.

Prices rose in London on Monday, meanwhile, after Iranian Oil Minister Bijan Namdar Zanganeh said on Saturday that current oil prices were "good" and that OPEC could consider delaying a scheduled production increase when it meets later this month.

"I think that at the moment the prices are good. Many people are happy about the current prices," Zanganeh told reporters.

"If at the end of this month we feel there is no need for extra oil, we can postpone the decision on the extra 500,000 barrels per day (bpd). It depends on the market situation and the prices," he said.

Faced with record high prices on world markets, OPEC had announced June 3 it would raise production quotas by two million bpd on July 1, and by another 500,000 bpd on Aug 1.

Zanganeh's remarks followed similar comments last on Wednesday from Saudi Arabian Oil Minister Ali al-Nuaimi, who said that current prices were "fair" and that there was "no reason to take a measure to reduce or increase production" when OPEC meets on July 21.