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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Big Dog who wrote (21425)	5/5/1998 8:43:00 AM
From: pz	Respond to of 95453

LONDON, May 5 (Reuters) - World oil prices suffered a setback on Tuesday as speculation that major producers would meet at the weekend to make more output cuts came to nought. London June futures for benchmark Brent blend shed 31 cents in early business to $14.82 a barrel. Brent jumped 64 cents on Friday amid rumours that Saudi Arabia, Venezuela and Mexico would meet over the weekend in a repeat of the March Riyadh pact which took 1.5 million barrels a day (bpd) out of the glutted market. "The market got somewhat overheated going into the weekend and now it's cooling off," said an oil trader in London. "The talk of more cuts has shored up prices when they would have otherwise have dropped but the market will soon start discounting these conversations in the absence of concrete news," said Leslie Nicholas of brokers GNI. Venezuela has already suggested another 500,000 bpd be removed from the market to help prices which are still running $4.50 lower than on average last year. The visit of Saudi Oil Minister Ali al-Naimi to the United States for a meeting on Monday with the U.S. Department of Energy had led to speculation that further output cuts might be agreed. But Adrian Lajous, the head of Mexico's state oil company Pemex, was reported on Tuesday saying it was too early for further reductions. "It is not on the table to make any further production cuts now," Lajous said. Mexico also denied that any meeting with the Saudi and Venezuelan oil ministers was scheduled. Attention will now turn to a meeting of the Organisation of the Arab Petroleum Exporting Countries in Damascus on May 10. Saudi's Naimi will attend as will OPEC President Obeid al-Nasseri of the United Arab Emirates. Host Syria has been approached as a possible candidate to reduce its output. Traders were also taking notice of lower OPEC output in April. A Reuters survey last week pegged OPEC output in the first half of April at 28.1 million bpd, with 10 members cutting a million bpd from the February benchmark for Riyadh pact reductions. But that was offset by an extra 350,000 bpd from Iraq over the period. Prices in dollars per barrel: May 5 May 4 1010 GMT (close) IPE June Brent 14.83 NA NYMEX June light crude 15.76 15.95