Opec oil cartel ministers began formal deliberations on Wednesday amid supply fears in world oil markets that sent prices higher prior to the start of the ministerial session.
Oil for October delivery had risen 0,47% prior to the meeting to $44,60 per barrel on New York’s Mercantile Exchange. This represented a rise of more than 4% since the start of the week, but prices remained a long way off the August 20 record of $49,40 per barrel.
The increase came despite expectations the 11 countries comprising Opec would boost official production by one million barrels per day. A hike in the target corridor for world oil prices also was expected, more as a technical adjustment to the reality of higher oil prices.
Increased official production would send a positive signal to oil markets. Opec currently observes an official quota of 26-million barrels but produces about two million barrels more than the quota. Coupled with two million barrels per day from Iraq, which is not subject to the official quota, Opec produces about 30-million barrels per day. A barrel of oil represents 159 litres.
Oil traders also were watching Hurricane Ivan in the Gulf of Mexico, which could disrupt supply from platforms in the gulf as well as tanker deliveries. Platform crews had been evacuated from platforms as the storm approached the gulf after churning through the Caribbean. — Sapa-DPA