Oil prices above US$63 after output cuts

SINGAPORE – Oil prices climbed above US$63 in Asian trade yesterday after moves by Venezuela and Nigeria to cut output added to concerns that OPEC as a whole could trim production to defend the US$60 level, dealers said.

At 0302 GMT New York’s main contract, light sweet crude for November delivery, was up 31 cents at US$63,22 a barrel from US$62,91 in late US trades Friday. Brent North Sea for November was up 20 cents at US$62,68.Crude oil prices have fallen about 20 per cent from July record highs, triggering expectations of an imminent move by the Organisation of Petroleum Exporting Countries (Opec) to cut its production.The 11-member grouping of oil producing nations said last week there were no plans for an emergency meeting to reduce its production ceiling of 28 million barrels a day, which has stood since July 2005.However, Opec members Nigeria and Venezuela then announced they would reduce their oil production by a combined 170 000 bpd and on Sunday Iran said it would support any Opec moves to bolster prices.”Crude is moving up a little, I think, in the midst of confusion over what Opec will or will not do,” said Victor Shum, an analyst with energy consultancy Purvin and Gertz.”Even though Opec has not officially cut their output targets, a lot of them are already throttling back their production,” he said.Iran said Sunday it would “support any effort by Opec members to solidify the oil market and return prices to an acceptable and logical level.”An acceptable level of prices is a level which the Islamic republic of Iran, in collaboration with other Opec members, can support,” it added.Iran is the world’s fourth largest crude producer.Oil fell below US$60 early last week as tensions eased over Iran’s nuclear program and as British energy giant BP said it would resume full output at the biggest US oil field in Alaska.Nampa-AFPBrent North Sea for November was up 20 cents at US$62,68.Crude oil prices have fallen about 20 per cent from July record highs, triggering expectations of an imminent move by the Organisation of Petroleum Exporting Countries (Opec) to cut its production.The 11-member grouping of oil producing nations said last week there were no plans for an emergency meeting to reduce its production ceiling of 28 million barrels a day, which has stood since July 2005.However, Opec members Nigeria and Venezuela then announced they would reduce their oil production by a combined 170 000 bpd and on Sunday Iran said it would support any Opec moves to bolster prices.”Crude is moving up a little, I think, in the midst of confusion over what Opec will or will not do,” said Victor Shum, an analyst with energy consultancy Purvin and Gertz.”Even though Opec has not officially cut their output targets, a lot of them are already throttling back their production,” he said.Iran said Sunday it would “support any effort by Opec members to solidify the oil market and return prices to an acceptable and logical level.”An acceptable level of prices is a level which the Islamic republic of Iran, in collaboration with other Opec members, can support,” it added.Iran is the world’s fourth largest crude producer.Oil fell below US$60 early last week as tensions eased over Iran’s nuclear program and as British energy giant BP said it would resume full output at the biggest US oil field in Alaska.Nampa-AFP