Crude oil price trades narrowly around 61/62 in Asian morning as investors await more important data to be released later this week. Trading is expected to be light throughout the day due to holidays in the UK and the US. Focus of the week is OPEC's meeting in Vienna on May 28. Over the weekend, Saudi Arabia Oil Minister Ali al- Naimi said that the organization will likely 'stay the course' at this meeting. However, he also pointed out that industrial oil stockpiles are too high and would like them to be reduced to 52-54 days from the current 62 days of consumption. When commenting about OPEC's compliance, Naimi said he's fine with the current level. In April OPEC-11 implemented 77%, compared with 82% a month ago, of the planned out cuts of 4.2M bpd. However, Libya, another OPEC member said there's still 50% for a production cut in May. We think it's unlikely for the OPEC to another a further output reduction at the upcoming meeting as oil price has stabilized since the previous meeting in March. In fact, oil price has risen almost 30% since then and is still trading with upside momentum. OPEC will probably find it less motivated to implement further cut at the moment particularly when some members still have rooms to improve their compliance while economies of some member countries rely heavily on oil exports. Last month, both Algeria and Qatar said that they can tolerate a price of 50/bbl, lowered from the previous informal target of 70/bbl. Gold price retreats after rising to 2-month high at 964.6 Friday as USD rebounds against the euro and other major currencies after the sharp fall last week. However, weakness in USD should help resume recent rally after consolidation. The Japanese yen and the dollar rise as geopolitical unrest arises after North Korea said it held a nuclear weapons test. According to the official statement from the North Korean Government, the underground nuclear test was to bolster up its nuclear deterrent for self defense. Korean won slides against the dollar after the news. Stock markets in Asia also drop with the MSCI Asia Pacific Index sliding 0.4%, China CSI and Hong Kong's Hang Seng Indices losing 1% and 0.6% respectively. In Japan, however, the benchmark stock Index climbs 1% after the BOJ Governor Shirakawa said the nation's economy may experience mid recovery as exports and production improve. That said, any recovery would be slow while timing and the degree would be uncertain.

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