well looks like opec would help stop any possible deflation due to demand on the oil front
--------------------------------
Feb. 8 (Bloomberg) -- The Organization of Petroleum Exporting Countries may cut crude production when it meets next month to keep the price above $80 a barrel, oil ministry officials from four of the group's nations said.
Prices of at least $85 would likely lead to no change in supplies when ministers gather March 5 in Vienna, said two of the four officials, who asked not to be identified because OPEC's deliberations are private. A third said $80 a barrel would be a signal to pump less, and a fourth delegate said $70 would be unacceptable to most of OPEC's 13 members.
The combination of falling crude prices and the dollar's 12 percent drop in the past year on a trade-weighted basis puts pressure on OPEC to reduce supplies as slowing economies in the U.S. and Europe threaten energy demand. Oil fell 30 percent and the group reduced production quotas three times in 2001, the year of the last U.S. recession.
``OPEC wants to protect $80 a barrel,'' said Johannes Benigni, a managing director at Vienna-based consultant JBC Energy, who attended last week's OPEC meeting when the group left its supply levels unchanged.
``I got the clear impression from OPEC that that's the number they want to defend,'' Benigni said. ``It wasn't OPEC's fault it moved above $80, but now it's there, they justify keeping it.''
Oil rose 97 cents to $88.11 in New York yesterday. Prices rose 53 percent in the past year and reached a record $100.09 a barrel on Jan. 3. They dropped 12 percent since then.
March Meeting
Saudi Arabian Oil Minister Ali al-Naimi, who sets policy for OPEC's largest producer, declined to comment to reporters on prices or production levels at last week's meeting. Al-Naimi said only that the outlook for supply and demand is ``sound.''
OPEC may maintain current levels when it meets on March 5, ``if the market is as it is now,'' OPEC Secretary-General Abdalla el-Badri told reporters on Feb. 5 in London. The group pumped 32.12 million barrels a day last month, according to Bloomberg estimates.
The organization, which produces more than 40 percent of the world's oil, scrapped the last official price target of $22 to $28 a barrel in January 2005 after oil exceeded that level for more than a year. Delegates from Libya and Algeria pushed for a price band of about $55 to $60 a barrel in 2006. The proposal was rejected and oil continued to rally.
Concern the U.S. economy, the world's largest, is falling into a recession drove crude lower in the past month. The price dropped $2.79, or 3 percent on Feb. 1 after a U.S. government report showed the economy lost 17,000 jobs in January.
`New Price Floor'
``It is not in our interests to see a recession, whether in the U.S. or worldwide,'' el-Badri said in an interview last month in Nicosia, Cyprus.
OPEC held three meetings in 2007, down from six the previous year. The group will likely gather more frequently to monitor the U.S. economy, said the four officials, who represent nations that produce a third of OPEC's oil.
``Eighty dollars is probably a new price floor,'' said Olivier Jakob, managing director of Zug, Switzerland-based Petromatrix GmbH. ``On a nominal basis it looks high, but if you adjust it for the falling dollar, it is closer to the average of 2006 and 2007 of $58 a barrel.''
The dollar's decline eroded the purchasing power of OPEC revenue as members plan to invest $150 billion on new energy projects over the next five years.
OPEC last cut supplies at the end of 2006, reducing quotas twice as oil fell as low as $55 in November. Prices rallied 57 percent the following year.
``Getting closer to the March meeting if we're in the $80 to $85 range and there is still downward pressure, then they would defend aggressively,'' said Victor Shum, senior principal at Purvin & Gertz Inc., an oil consulting firm in Singapore. ``They have seen that the market can tolerate higher prices. And, in any number of OPEC economies they need the oil revenues of high prices to support their domestic spending programs.'' Feb. 8 (Bloomberg) -- The Organization of Petroleum Exporting Countries may cut crude production when it meets next month to keep the price above $80 a barrel, oil ministry officials from four of the group's nations said.
Prices of at least $85 would likely lead to no change in supplies when ministers gather March 5 in Vienna, said two of the four officials, who asked not to be identified because OPEC's deliberations are private. A third said $80 a barrel would be a signal to pump less, and a fourth delegate said $70 would be unacceptable to most of OPEC's 13 members.
The combination of falling crude prices and the dollar's 12 percent drop in the past year on a trade-weighted basis puts pressure on OPEC to reduce supplies as slowing economies in the U.S. and Europe threaten energy demand. Oil fell 30 percent and the group reduced production quotas three times in 2001, the year of the last U.S. recession.
``OPEC wants to protect $80 a barrel,'' said Johannes Benigni, a managing director at Vienna-based consultant JBC Energy, who attended last week's OPEC meeting when the group left its supply levels unchanged.
``I got the clear impression from OPEC that that's the number they want to defend,'' Benigni said. ``It wasn't OPEC's fault it moved above $80, but now it's there, they justify keeping it.''
Oil rose 97 cents to $88.11 in New York yesterday. Prices rose 53 percent in the past year and reached a record $100.09 a barrel on Jan. 3. They dropped 12 percent since then.
March Meeting
Saudi Arabian Oil Minister Ali al-Naimi, who sets policy for OPEC's largest producer, declined to comment to reporters on prices or production levels at last week's meeting. Al-Naimi said only that the outlook for supply and demand is ``sound.''
OPEC may maintain current levels when it meets on March 5, ``if the market is as it is now,'' OPEC Secretary-General Abdalla el-Badri told reporters on Feb. 5 in London. The group pumped 32.12 million barrels a day last month, according to Bloomberg estimates.
The organization, which produces more than 40 percent of the world's oil, scrapped the last official price target of $22 to $28 a barrel in January 2005 after oil exceeded that level for more than a year. Delegates from Libya and Algeria pushed for a price band of about $55 to $60 a barrel in 2006. The proposal was rejected and oil continued to rally.
Concern the U.S. economy, the world's largest, is falling into a recession drove crude lower in the past month. The price dropped $2.79, or 3 percent on Feb. 1 after a U.S. government report showed the economy lost 17,000 jobs in January.
`New Price Floor'
``It is not in our interests to see a recession, whether in the U.S. or worldwide,'' el-Badri said in an interview last month in Nicosia, Cyprus.
OPEC held three meetings in 2007, down from six the previous year. The group will likely gather more frequently to monitor the U.S. economy, said the four officials, who represent nations that produce a third of OPEC's oil.
``Eighty dollars is probably a new price floor,'' said Olivier Jakob, managing director of Zug, Switzerland-based Petromatrix GmbH. ``On a nominal basis it looks high, but if you adjust it for the falling dollar, it is closer to the average of 2006 and 2007 of $58 a barrel.''
The dollar's decline eroded the purchasing power of OPEC revenue as members plan to invest $150 billion on new energy projects over the next five years.
OPEC last cut supplies at the end of 2006, reducing quotas twice as oil fell as low as $55 in November. Prices rallied 57 percent the following year.
``Getting closer to the March meeting if we're in the $80 to $85 range and there is still downward pressure, then they would defend aggressively,'' said Victor Shum, senior principal at Purvin & Gertz Inc., an oil consulting firm in Singapore. ``They have seen that the market can tolerate higher prices. And, in any number of OPEC economies they need the oil revenues of high prices to support their domestic spending programs.''
--------------------------------
Feb. 8 (Bloomberg) -- The Organization of Petroleum Exporting Countries may cut crude production when it meets next month to keep the price above $80 a barrel, oil ministry officials from four of the group's nations said.
Prices of at least $85 would likely lead to no change in supplies when ministers gather March 5 in Vienna, said two of the four officials, who asked not to be identified because OPEC's deliberations are private. A third said $80 a barrel would be a signal to pump less, and a fourth delegate said $70 would be unacceptable to most of OPEC's 13 members.
The combination of falling crude prices and the dollar's 12 percent drop in the past year on a trade-weighted basis puts pressure on OPEC to reduce supplies as slowing economies in the U.S. and Europe threaten energy demand. Oil fell 30 percent and the group reduced production quotas three times in 2001, the year of the last U.S. recession.
``OPEC wants to protect $80 a barrel,'' said Johannes Benigni, a managing director at Vienna-based consultant JBC Energy, who attended last week's OPEC meeting when the group left its supply levels unchanged.
``I got the clear impression from OPEC that that's the number they want to defend,'' Benigni said. ``It wasn't OPEC's fault it moved above $80, but now it's there, they justify keeping it.''
Oil rose 97 cents to $88.11 in New York yesterday. Prices rose 53 percent in the past year and reached a record $100.09 a barrel on Jan. 3. They dropped 12 percent since then.
March Meeting
Saudi Arabian Oil Minister Ali al-Naimi, who sets policy for OPEC's largest producer, declined to comment to reporters on prices or production levels at last week's meeting. Al-Naimi said only that the outlook for supply and demand is ``sound.''
OPEC may maintain current levels when it meets on March 5, ``if the market is as it is now,'' OPEC Secretary-General Abdalla el-Badri told reporters on Feb. 5 in London. The group pumped 32.12 million barrels a day last month, according to Bloomberg estimates.
The organization, which produces more than 40 percent of the world's oil, scrapped the last official price target of $22 to $28 a barrel in January 2005 after oil exceeded that level for more than a year. Delegates from Libya and Algeria pushed for a price band of about $55 to $60 a barrel in 2006. The proposal was rejected and oil continued to rally.
Concern the U.S. economy, the world's largest, is falling into a recession drove crude lower in the past month. The price dropped $2.79, or 3 percent on Feb. 1 after a U.S. government report showed the economy lost 17,000 jobs in January.
`New Price Floor'
``It is not in our interests to see a recession, whether in the U.S. or worldwide,'' el-Badri said in an interview last month in Nicosia, Cyprus.
OPEC held three meetings in 2007, down from six the previous year. The group will likely gather more frequently to monitor the U.S. economy, said the four officials, who represent nations that produce a third of OPEC's oil.
``Eighty dollars is probably a new price floor,'' said Olivier Jakob, managing director of Zug, Switzerland-based Petromatrix GmbH. ``On a nominal basis it looks high, but if you adjust it for the falling dollar, it is closer to the average of 2006 and 2007 of $58 a barrel.''
The dollar's decline eroded the purchasing power of OPEC revenue as members plan to invest $150 billion on new energy projects over the next five years.
OPEC last cut supplies at the end of 2006, reducing quotas twice as oil fell as low as $55 in November. Prices rallied 57 percent the following year.
``Getting closer to the March meeting if we're in the $80 to $85 range and there is still downward pressure, then they would defend aggressively,'' said Victor Shum, senior principal at Purvin & Gertz Inc., an oil consulting firm in Singapore. ``They have seen that the market can tolerate higher prices. And, in any number of OPEC economies they need the oil revenues of high prices to support their domestic spending programs.'' Feb. 8 (Bloomberg) -- The Organization of Petroleum Exporting Countries may cut crude production when it meets next month to keep the price above $80 a barrel, oil ministry officials from four of the group's nations said.
Prices of at least $85 would likely lead to no change in supplies when ministers gather March 5 in Vienna, said two of the four officials, who asked not to be identified because OPEC's deliberations are private. A third said $80 a barrel would be a signal to pump less, and a fourth delegate said $70 would be unacceptable to most of OPEC's 13 members.
The combination of falling crude prices and the dollar's 12 percent drop in the past year on a trade-weighted basis puts pressure on OPEC to reduce supplies as slowing economies in the U.S. and Europe threaten energy demand. Oil fell 30 percent and the group reduced production quotas three times in 2001, the year of the last U.S. recession.
``OPEC wants to protect $80 a barrel,'' said Johannes Benigni, a managing director at Vienna-based consultant JBC Energy, who attended last week's OPEC meeting when the group left its supply levels unchanged.
``I got the clear impression from OPEC that that's the number they want to defend,'' Benigni said. ``It wasn't OPEC's fault it moved above $80, but now it's there, they justify keeping it.''
Oil rose 97 cents to $88.11 in New York yesterday. Prices rose 53 percent in the past year and reached a record $100.09 a barrel on Jan. 3. They dropped 12 percent since then.
March Meeting
Saudi Arabian Oil Minister Ali al-Naimi, who sets policy for OPEC's largest producer, declined to comment to reporters on prices or production levels at last week's meeting. Al-Naimi said only that the outlook for supply and demand is ``sound.''
OPEC may maintain current levels when it meets on March 5, ``if the market is as it is now,'' OPEC Secretary-General Abdalla el-Badri told reporters on Feb. 5 in London. The group pumped 32.12 million barrels a day last month, according to Bloomberg estimates.
The organization, which produces more than 40 percent of the world's oil, scrapped the last official price target of $22 to $28 a barrel in January 2005 after oil exceeded that level for more than a year. Delegates from Libya and Algeria pushed for a price band of about $55 to $60 a barrel in 2006. The proposal was rejected and oil continued to rally.
Concern the U.S. economy, the world's largest, is falling into a recession drove crude lower in the past month. The price dropped $2.79, or 3 percent on Feb. 1 after a U.S. government report showed the economy lost 17,000 jobs in January.
`New Price Floor'
``It is not in our interests to see a recession, whether in the U.S. or worldwide,'' el-Badri said in an interview last month in Nicosia, Cyprus.
OPEC held three meetings in 2007, down from six the previous year. The group will likely gather more frequently to monitor the U.S. economy, said the four officials, who represent nations that produce a third of OPEC's oil.
``Eighty dollars is probably a new price floor,'' said Olivier Jakob, managing director of Zug, Switzerland-based Petromatrix GmbH. ``On a nominal basis it looks high, but if you adjust it for the falling dollar, it is closer to the average of 2006 and 2007 of $58 a barrel.''
The dollar's decline eroded the purchasing power of OPEC revenue as members plan to invest $150 billion on new energy projects over the next five years.
OPEC last cut supplies at the end of 2006, reducing quotas twice as oil fell as low as $55 in November. Prices rallied 57 percent the following year.
``Getting closer to the March meeting if we're in the $80 to $85 range and there is still downward pressure, then they would defend aggressively,'' said Victor Shum, senior principal at Purvin & Gertz Inc., an oil consulting firm in Singapore. ``They have seen that the market can tolerate higher prices. And, in any number of OPEC economies they need the oil revenues of high prices to support their domestic spending programs.''
hno:
