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Oil prices down as OPEC rules out emergency talks
AFP
NEW YORK
Petroleumworld.com 09 27 06
World oil prices dipped on Tuesday after the OPEC cartel of producer nations signalled no cut to its current output levels for now.
The Organization of the Petroleum Exporting Countries said it was not considering an emergency session of talks ahead of its scheduled December meeting, despite recent heavy falls in crude prices, dealers said.
Markets also reacted to news from British energy giant BP that it expected Prudhoe Bay in Alaska, the biggest US oil field, would resume full production totalling 400,000 barrels daily by the end of October.
New York's main contract, light sweet crude for delivery in November, eased 44 cents to close at 61.45 dollars a barrel.
In London, Brent North Sea crude for November delivery fell 68 cents to a settlement of 60.12 dollars a barrel.
Both the New York and London contracts had fallen below 60 dollars in intra-day trade Monday to their lowest levels since March 8, sparking talk that OPEC may cut output before December to put a floor under prices.
But a spokesman for the 11-nation cartel told AFP in Vienna: "There is really no meeting planned as of now (before December).
"The (OPEC) president is always in consultations with the other ministers and they're discussing the matter, but there is no emergency meeting scheduled," she said.
Calyon analyst Mike Wittner called it a "notable statement".
"This week, the markets are really looking to figure out when OPEC, in particular Saudi Arabia, is going to take some action."
Dealers said the market was concerned that the cartel might begin to trim production if prices dropped much further.
"The market is watching out for any signs of what OPEC might do and what prices they may support," said Mark Pervan, an energy analyst for Daiwa Securities in Melbourne.
Michael Davies, an analyst with the Sucden brokerage in London, added: "Voices within OPEC have started to make noises about being concerned by the sharp fall in oil prices.
"However, there is still no plan to call an emergency meeting before December."
OPEC kept its official quota steady at 28 million barrels per day (bpd) at its last meeting in September, but said it could call an emergency meeting if necessary. The next meeting is due on December 14 in Abuja, Nigeria.
Regarding Prudhoe Bay, a BP spokesman in London told AFP that output had been raised over the weekend to 300,000 barrels per day after normal production was slashed by about half last month owing to a pipeline leak.
The spokesman added that output at the Alaskan field would rise to 350,000 bpd over the next week.
Easing concerns about oil supplies have sent prices tumbling by as much as 25 percent since crude futures hit record highs in July and August.
Prices have been dampened by a mild Atlantic hurricane season, healthy US energy stockpiles, signals pointing towards a slowing US economy and lessening tensions over the Iranian nuclear crisis.
AFP 261932 GMT 09 06
Copyright ©2006 AFP. All Rights Reserved.
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