Oil prices eased on Monday as Opec debated whether to delay a planned production cut to cool red-hot oil prices which last week touched a 13-year high.
US light crude for April delivery fell 97 cents to $37.11 a barrel. London's Brent crude lost 46 cents to $32.80 a barrel.
Prices have risen about 13 percent since Opec agreed last month to cut official production quotas by 1 million barrels per day (bpd) from April 1 to stop supplies building in the second quarter when demand seasonally drops.
Oil prices last week hit the highest closing price in 13 years on soaring Chinese demand, low US fuel inventories and fears of attacks that could disrupt oil supplies.
Opec ministers will meet on March 31 in Vienna to review policy.
United Arab Emirates Oil Minister Obaid bin Saif al-Nasseri said Opec would discuss delaying its April output cut.
A senior Opec delegate said Opec may consider deferring the reduction in production quotas until June.
"The idea is there, but there is no formal proposal as such," the delegate said.
Qatari Oil Minister Abdullah al Attiyah said he would oppose any move by Opec to postpone its agreement.
"I don't support the postponement of the cut," Attiyah told Reuters. "I have never heard the suggestion from any member and I don't support the postponement."
Algeria's energy minister Chakib Khelil said he was worried about high crude prices but that there was little Opec could do to stop prices rising. "Of course we are concerned, as much concerned by high prices as by low prices," Khelil told Reuters in an interview.
"We can't do much to stop prices going up further. We are overproducing above our quotas, most of us. Assuming we are producing at top capacity and prices are remaining high it must be for other reasons," Khelil said.
Ali al-Naimi, oil minister for Opec's leading producer Saudi Arabia, at the weekend blamed high prices on speculators and low US gasoline stocks.
Naimi said it was not clear if Opec would delay the cut. "I don't know. At the moment no one is in a position to say," Naimi told Italy's Il Sole 24 Ore in an interview.
In a research note, SG Securities said Opec risked losing credibility with the speculative hedge funds that have driven prices higher if it did not go through with the April reduction.
"Failing to confirm April's cut - and to implement it - would show Opec as unwilling to control the oil market or even incapable of doing so," SG said.
"Hedge funds would punish an Opec perceived as weak-willed by quickly liquidating, or even reversing their long positions, with the resulting wave of selling triggering a price collapse."
Analysts have estimated that speculative interest in the oil markets had added as much as $8 to the price of crude.
Data from the US Commodity Futures Trading Commission (CFTC) showed on Friday non-commercial petroleum speculators trimming net long positions - a bet prices will rise - which had been running at four-and-a-half year highs.
Comments
Comments are closed.