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SINGAPORE: World oil prices traded near $100 a barrel Thursday after
spiking to a new record amid speculation OPEC may decide to slash
production at a meeting next month, dealers said.
New York’s main oil futures contract, light
sweet crude for delivery in March, touched an all-time peak of
$101.32 in electronic trading before it lapsed.
In afternoon trade, the contract for April
delivery was trading at $99.95 a barrel, up 25 cents from the
previous day. The April contract briefly reached an intra-day high
of $100.14.
Brent North Sea crude for April delivery rose 28
cents to $98.70 a barrel.
Oil prices could go even higher, said David
Moore, a commodity strategist at the Commonwealth Bank of Australia.
He said that in the near-term the oil market
will be “heavily influenced” by any decision of the Organization
of Petroleum Exporting Countries on output levels at its next
meeting on March 5.
OPEC ministers kept the official daily output
ceiling at 29.67 million barrels of oil at an emergency meeting on
February 1, resisting calls from President George W. Bush to
increase supplies to help bring down prices.
But the market is rife with speculation that
OPEC, which supplies about 40 percent of the world’s oil, would
keep steady or even decide to cut production.
Phil Flynn, an analyst at Chicago-based Alaron
Trading, compared the price surge to a raging bull.
“When the bull is raging you do not want to
stand in front of it. Price is no object when it comes to a raging
bull,” he said.
“This is especially true in the oil market
where the fine line between over-supply and under-supply is getting
finer every day.”
Flynn added that the run-up in oil was “not
about current supply but about the perceived threat to future supply
... it is obvious that this market is paranoid about less oil even
in a slowing economy.”
Libya’s oil chief Shukri Ghanem said that OPEC
will wait to see if oil prices hold around record highs of $100
before making any decision on whether to cut output.
Ghanem told AFP that with prices at current
levels, OPEC wanted to see if $100 a barrel proves to be the ceiling
or if they would begin to fall back.
An ongoing row between US energy giant
ExxonMobil and Latin American crude oil exporter Venezuela, and
unrest in Africa’s biggest oil exporter Nigeria, also added to
jitters among investors, analysts said.
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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