Gulf News reported that oil prices rebounded from recent sharp losses as investors tracked rising stocks in cautious deals before a US interest rate decision on the eve of a meeting of the Organisation of Petroleum Exporting Countries in Vienna to discuss possible production level changes.
Mr Mohammad Bin Dhaen Al Hameli energy minister of UAE said that oil demand in 2012 will be similar to 2011. In midday trading, the price of Brent North Sea crude for delivery in January added USD 1 per barrel to USD 108.26 per barrel.
Mr Samuel Ciszuk, a consultant at KBC Process Technology said that "Growing consensus around the output roof of 30 million barrel per day is something which has been widely mentioned. Whether we actually see that number or whether it's trimmed to a different amount remains to be seen. We most certainly will not see a new agreement on country quotas."
OPEC members who supply a third of the world's crude oil will decide on whether to raise the formal target of 24.845 million barrels per day closer to its actual production of about 30 million barrel per day taking into consideration possible new sanctions that threaten Iran's oil output, a higher than expected output from Libya and a weak economic outlook for global markets.
The West's energy watchdog International Energy Agency and OPEC said that healthy production levels by OPEC will help balance oil markets next year as demand growth slows. The IEA and OPEC had raised output to its highest level in more than 3 years and the oil producer group said it was now pumping more than might be required next year.
Mr David Fyfe head of the oil industry and markets division of the IEA said that "Our base case is seeing a relatively balanced market next year if OPEC continues to produce at the levels they have been producing at over the last three or 4 months."
Mr Peter Grimsditch editorial director at Oxford Business Group said that out of the 4 million plus barrel per day of oil that Iran produces around 35% is for domestic consumption. If Iranian oil exports were completely cut it would mean a global shortfall of 2.5 million barrel per day. This is, of course, a significant number but far from a global disaster. Saudi Arabia alone has the ability and capacity to make up most of this shortfall.
(Sourced from Gulf News)
