IHT: Oil steady at US$67 as investors await OPEC cut
SINGAPORE: Oil prices were steady at US$67 a barrel Friday in Asia as investors waited to see how much OPEC will cut output quotas amid plunging prices and weakening global crude demand.
Light, sweet crude for December delivery fell 24 cents to US$67.60 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract overnight rose US$1.09 to settle at US$67.84.
The Organization of Petroleum Exporting Countries, which accounts for 40 percent of global oil supply, is poised to lower production quotas at an emergency meeting in Vienna later Friday. The question for investors is how much crude will the cartel take off an oil market reeling from a global economic slowdown.
"With so many economies in trouble, OPEC has to be careful not to kill off crude demand" said Peter McGuire, managing director at investment firm Commodity Warrants Australia in Sydney. He expects a cut between 1 million and 1.5 million barrels a day.
Iranian Oil Minister Gholam Hossein Nozari said Friday a cut of 2 million barrels a day would stabilize prices that have fallen more than 50 percent since peaking in mid-July. Libyan oil chief Shokri Ghanem told reporters that OPEC needed to make a "huge cut."
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Ali Naimi, oil minister of OPEC heavyweight Saudi Arabia, declined to say how big a cut his country supported.
OPEC's need to boost prices may be tempered by a stronger dollar, which has surged in recent weeks and bolstered the group's income. The euro fell to US$1.2788 on Friday from US$1.2895 on Thursday.
"The saving grace for OPEC may be that the dollar has risen so much in the last month." McGuire said. "But if prices fall below US$60, I would expect OPEC to make another cut in December."
In other Nymex trading, heating oil futures were steady at US$2.03 a gallon, while gasoline prices fell 0.89 cents to US$1.57 a gallon. Natural gas for November delivery rose 1.1 cents to US$6.43 per 1,000 cubic feet.
In London, November Brent crude was down 24 cents to US$65.68 a barrel on the ICE Futures exchange.
