Oil prices eased but held over $76 on Monday, as expectations Opec will maintain supply curbs on Tuesday countered weak US jobs data that raised concerns of a recession in the world's top consumer. US light crude fell 15 cents to $76.55 a barrel, after climbing 40 cents on Friday. London Brent crude fell 17 cents to $74.90 a barrel.
Payrolls in the United States shrank unexpectedly for the first time in four years last month, data showed on Friday, prompting concerns that credit market turmoil might drag the economy into a recession.
Economic troubles that some analyst's fear could undermine future oil demand have kept a lid on an oil price rally to near the record high of $78.77 a barrel struck on August 1.
"Near record spot prices, steep inventory draws and economic uncertainty would all be good reasons for Opec to reverse its October 2006 production cuts at its meeting on September 11," said Lehman Brothers in a research note.
"But few observers, us included, believe that it will do so." Ahead of its meeting in Vienna on Tuesday, most oil ministers in Opec, which supplies more than a third of the world's oil, stuck to the line that current output was sufficient to meet demand.
But Saudi Oil Minister Ali Al-Naomi has declined comment since arriving in Vienna late on Friday. He has not responded to a report by Washington-based constancy PFC Energy suggesting Saudi Arabia favour an output boost of up to one million bpd.
An industry source said on Monday that Saudi Arabia, the worlds top oil exporter, told its customers in Asia it would keep its crude oil supplies steady for October from September.
Saudi Arabia's view is key to any Opec decision. The kingdom pumped 8.65 million barrels a day of the cartel's total August production of 30.37 bpd, according to Reuters data. It also has the bulk of Opec's spare production capacity.
On Saturday, a top official at state oil company Saudi Armco said Saudi Arabia was on schedule with plans to boost its crude oil production capacity to 12.5 million barrels per day by 2009, despite rising industry costs.
Comments
Comments are closed.