Oil Prices End Mixed as OPEC Meeting Nears : Quiet Trading Attributed to Upcoming Holiday
Oil prices ended mixed on most world markets Tuesday in quiet trading ahead of the upcoming Memorial Day weekend in the United States and the Vienna meeting of OPEC oil ministers slated for next month.
Analysts said market participants also were awaiting the release later in the day of weekly figures on the nation’s oil stocks that were expected to show an increase in crude and heating oil supplies and flat or slightly lower gasoline inventories.
“We seem to be marking time until the dreaded OPEC meeting June 8,” said Andrew Lebow, analyst with E.D.& F. Man International Futures Inc. in New York.
The 13 oil ministers of the Organization of Petroleum Exporting Countries are to gather in Vienna, where they are expected to continue discussions on ways to bolster sagging world oil prices.
Oil prices have slipped in recent months, principally as a result of a global supply glut. The average traded price for oil is between $15 and $16 a barrel, substantially below OPEC’s official target of $18 a barrel.
The cartel’s efforts to prop up prices, which sank as low as $13 a barrel in early March, have been limited to exhorting its members to stick to loosely observed production quotas agreed on in December.
On the European spot market, where oil is sold to the highest bidder, the United Arab Emirates’ Dubai light--the key OPEC crude from the Middle East--lost 15 cents to $14.75 a barrel.
But Britain’s North Sea Brent, the world’s most widely traded crude, tacked on a nickel to $16.25 a barrel.
In New York Mercantile Exchange trading, West Texas Intermediate--the benchmark U.S. crude for immediate delivery--closed unchanged at $17.35 a barrel.
West Texas Intermediate slipped 15 cents to $17 a barrel in spot trading on the U.S. Gulf Coast.
Analysts said prices were pressured Monday by reports of a sharp buildup in global oil supplies during April and May that could frustrate OPEC efforts to bolster prices when seasonal oil demand rises this summer.
In Washington, U.S. Energy Secretary John Herrington predicted OPEC member countries would have trouble limiting their output.
Herrington said the current excess in oil supplies would make it more difficult for OPEC to observe production quotas, assuming the members step up shipments to make up for lower oil prices.
Lebow said there appeared to be good demand for refined products in trading on the Merc, where prices bounced back after Monday’s sell-off.
While unleaded gasoline for June delivery added 0.41 of a cent to 51.85 cents a gallon, heating oil dropped 0.6 of a cent to 47.31 cents a gallon.
