LONDON, May 11 (Reuters) - Oil prices firmed on Monday but
lacked the conviction to hold above $15 a barrel as renewed
calls for
producers to consider a second round of output cuts were brushed
aside.
London futures for benchmark North Sea Brent closed 16 cents
a barrel firmer at $14.85 after slicing through $15 earlier in
the session.
Dealers remained sanguine about the chance of further output
cuts from world producers.
They said that in spite of a call from Qatar for more cuts,
it now looked likely that producers would wait at least until
June to consider more output restraint.
Qatari Oil Minister Abdullah al-Attiyah said on Monday that
oil markets remained very weak and he wanted ministers to
quickly agree more output cuts.
Attiyah said he wanted Arab oil ministers meeting in
Damascus to consider further cuts in production to reduce what
he estimated was two million barrels a day of oversupply.
"Qatar is demanding during the consultations in Damascus that
a further cut should be made to support prices," Attiyah said.
Major oil producers have pledged reductions of about 1.5
million barrels a day (bpd) to year's end including 1.25 million
from Organisation of the Petroleum Exporting Countries (OPEC)
members.
But the world's largest oil producer, Saudi Arabia, appears
optimistic that oil markets are now robust enough to recover
without more supply being withdrawn.
A Gulf source familiar with Saudi thinking said on Monday in
Damascus that the markets were on the mend, bringing supply and
demand back into balance.
"We are 100 percent sure prices will not fall," the source
told reporters on the sidelines of an Arab energy conference.
He said it could take another four to six weeks to see the
full impact on the market of the cuts agreed by OPEC and
non-OPEC countries after a secret March meeting hosted in Riyadh
by Saudi Arabia.
But he said all producers, including Saudi Arabia, remained
open to the possibility of a second round of production cuts if
necessary.
Producers were discussing ways to improve the market
"including the possibility of further production cuts if
required," he said.
Mexico, one of the Riyadh trio of producers which
orchestrated the cuts, said last week that the outlook for the
market indicated more cuts would probably not be needed.
The source said Saudi Arabia was satisfied that producers
were sticking by those pledges.
"We are sure that most countries are committed to pledges --
OPEC and non-OPEC," he said.
The International Energy Agency on Monday said that OPEC had
implemented most of the oil production cuts it had promised.
The agency estimated OPEC produced 27.95 million bpd in
April, some 1.03 million below February output levels used as a
benchmark.
Prices in dollars per barrel:
May 11 May 8
(close) (close)
IPE June Brent 14.85 14.69
NYMEX June light crude 15.16 15.13 |
