Oil holds above 60 dollars in Asia
May 27, 2009
Oil held above 60 dollars a barrel in Asian trade yesterday ahead of a meeting this week of the Organisation of Petroleum Exporting Countries (OPEC). New York’s main futures contract, light sweet crude for delivery in July, was down 25 cents at 61.42 dollars a barrel. Brent North Sea crude for July delivery retreated 37 cents to 60.41 dollars. Prices eased as investors cashed in profits ahead of the OPEC meeting on Thursday. “Traders are taking profit from the markets,” said Mark Pervan, a senior commodities analyst with ANZ Bank in Melbourne.
“It’s probably a view that there is less likelihood of an output cut. OPEC has been fairly quiet on cutbacks so far.”
Algerian oil minister Chakib Khelil was quoted by Dow Jones Newswires as saying Sunday that he expected oil prices to hit 70 dollars a barrel next year.
Oil at 70 dollars a barrel is widely seen as the sustainable level for producers to resume large efforts to search for oil and gas.
Prices were unaffected by North Korea’s nuclear test earlier Monday, said Victor Shum, senior principal at energy consultancy Purvin and Gertz in Singapore.
“It (the test) may add to the political uncertainty in North Asia, which is a major petroleum importer, but it really does not have much concern in oil supply and demand,” he said.
The global economic crisis, which struck towards the end of 2008, has seen energy demand plummet, dragging prices along with it.
Oil fell from record peaks of more than 147 dollars per barrel in July to about 32 dollars in December as demand dropped off but has since risen gradually.
OPEC, which pumps some 40 percent of the global supply, has steadily cut production since late last year in a bid to support prices.
Source: The Daily Star
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