Opec meeting hikes oil price
OPEC ministers meeting in Vienna on Wednesday are expected to keep supply targets intact and instead rely on hoped-for economic growth to sustain oil prices.
The oil market rose towards $69 (£42) a barrel yesterday after G20 finance leaders said at a weekend meeting they would not end stimulus plans until economic recovery was well established.
Traders predicted the extended financial support would translate into higher fuel demand.
Opec president Jose Botelho de Vasconcelos, who is also Angola’s oil minister, said the 12-member group has a general consensus to keep output levels steady.
Crude prices have swung wildly in the past year, reaching $147 a barrel in July 2008 before plunging to $32 a barrel in February. Saudi Arabia, Opec’s biggest producer, has said $75 is a fair price for consumers and producers.
Opec has kept its official output targets steady since it announced late last year a record cut of 4.2m barrels per day from September 2008 production.
But some member countries are likely to be reminded to keep to agreed limits. Compliance has slipped from a peak of 80 per cent to less than 70 per cent because of the rebounding oil prices.
Opec, which supplies more than one third of the world’s oil, is also facing the challenge of non-OPEC producers, which ignored the group’s appeals to join in attempts to bolster the price.
Output from the largest non-Opec exporter Russia hit a record high in August of nearly 10m barrels per day.