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SINGAPORE: World oil prices eased in Asian trade
Wednesday but shadowed $100 per barrel after peaking to fresh record
levels overnight amid speculation OPEC will cut crude output,
dealers said.
In afternoon trade, New
York’s main contract, light sweet crude for delivery in March, was
down 66 cents to $99.35 per barrel.
The contract soared to an
all-time intra-day high of $100.10 before closing up $4.51 at a
record $100.01 on the New York Mercantile Exchange.
London’s Brent North Sea
crude for April delivery fell 71 cents to $97.85, after settling at
$98.56 per barrel, a gain of $3.65 on Tuesday.
The contract had earlier
jumped to a record high of $98.70 before settling.
Analysts said there was
growing speculation that the Organization of Petroleum Exporting
Countries (OPEC), which supplies about 40 percent of the world’s
oil, would cut output at its March 5 meeting in Vienna.
“When and how the oil is
cut is the key factor here,” said Darius Kowalczyk, a senior
investment strategist at CFC Seymour Securities in Hong Kong.
“I do not think oil
reaching the $100-mark can be fully justified. It is not a big deal
as demand is still on the decline.”
Earlier this month, OPEC
left its official daily output ceiling at 29.67 million barrels of
oil.
Iran on Sunday declined to
rule out that the OPEC cartel would cut production at its next
meeting, a move vehemently opposed by oil-consuming countries.
OPEC is expected to cut
output to prevent an oversupply as demand eases off in the northern
hemisphere with the end of the winter season, Kowalczyk said.
Another factor supporting
prices was the ongoing row between oil-rich Venezuela and US energy
behemoth ExxonMobil, the world’s biggest oil company.
“Venezuela taking action
to cut off supplies to Exxon last week has kept the market on edge
despite efforts by officialdom to downplay the actual impact on
supplies,” said Mike Fitzpatrick of MF Global.
ExxonMobil says it has won
court orders in New York, London, the Netherlands and the
Netherlands Antilles freezing some $12 billion of assets in those
jurisdictions from Venezuela’s state-owned oil producer PDVSA.
The legal battle relates to
ExxonMobil’s bid to secure compensation after Venezuela’s
government nationalized key oil fields in the Orinoco basin,
including two ExxonMobil operations.
--AFP
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