Updated Tue Jul 11 12:29 ET
NYMEX Oil: Crude mixed, bounces on reports OPEC hike uncertain
By Peter Rosenthal, BridgeNews
New York--July 11--Crude oil futures were mixed Tuesday, but bounced off
lows at midday on reports that Saudi Arabia's push to increase production again
may not be receiving support from other OPEC members and therefore may not come
to fruition, brokers said. At 1200 ET, Aug crude was down 19 cents at $29.50 a
barrel, but rose as high as $29.79 on the news. Brent crude on London's IPE was
last up 5c at $28.90.
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However, a late report suggested the Saudis and other major producers are
still on track to increase output by 500,000 barrels per day to push prices back
toward $25 per barrel.
A senior source with a country believed to be reluctant to increase output
told BridgeNews earlier Tuesday that there is no immediate need for OPEC to
increase oil production, since prices are moving toward an "acceptable range."
Another news wire later quoted several OPEC sources saying the increase is
now unlikely because there is a lack of consensus among members of the
organization.
"Obviously the belief (based on the subsequent story) is that they're on
track," a broker said.
Venezuela Oil Minister Ali Rodriguez, on a tour of OPEC nations, will be in
Kuwait later Tuesday and is expected to visit Riyadh Wednesday for talks with
Saudi officials, a meeting that should yield further news on whether OPEC will
increase output again. The organization agreed June 21 to raise output 708,000
bpd, the second production rise this year, but prices actually went higher,
surprising some OPEC ministers.
Oil markets have remained tight, particularly in gasoline and distillate
fuel, despite rising crude production. The International Energy Agency, warned
Tuesday in its monthly market report that more refined products were needed,
"and soon," if prices are too fall.
"Refiners do not really believe today's prices are sustainable, and hesitate
to run crude for product restocking, but product stocks are already unacceptably
low because of similar uncertainties earlier in the year and today's supply
obligations must be met," the report said. End |
