Oil slips further away from 100 usd mark on OPEC output increase speculation |
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Tue, 13 Nov 2007 10:32
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LONDON (Thomson Financial) - Oil prices slipped further away from the 100 usd mark, as the run at the key psychological level appeared to run out of steam, with market participants rattled by the prospect of an OPEC output increase.With the cartel due to meet in Riyadh on Nov 17-18 for an informal summit, and rumours circulating that the Saudis will push for a 500,000 bpd production increase in the near future, prices have pulled back from the highs.'I think now the markets feel OPEC could possibly do something,' said CMC Markets trader Nas Nijjar. 'OPEC will discuss output levels, and they have also said they have 3 mln barrels of spare capacity, so there's space for more production.'He added that while he thought an official production announcement was still more likely to come at the next quota meeting in Abu Dhabi on Dec 5, nothing could be ruled out due to the broader financial risks created by record oil prices, especially during the current economic turmoil.At 9.35 am, London's benchmark Brent crude contracts for December delivery were down 98 cents at 91.00 usd per barrel.Meanwhile, New York WTI crude contracts for December delivery were down 82 cents at 93.80 usd per barrel, having earlier dipped to an intraday low of 93.32 usd.Any increase in output could ease a market largely driven by supply fears, after a counter-seasonal third-quarter draw in OECD oil inventories raised fears demand could outstrip supply over the winter if production is disrupted.Last week both WTI and Brent crude hit fresh all-time highs, fuelling speculation that prices could break 100 usd a barrel.d.sheppard@thomson.comds1/raCOPYRIGHTCopyright Thomson Financial News Limited 2007. All rights reserved.The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
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Oil prices to remain high this winter; calls on OPEC to raise production - CGES 