U.S. News

Oil Rises Above $53, Eye on OPEC


Oil rose above $53 a barrel on Monday, recovering further from a 19-month low last week as some investors bet exporter group OPEC may lower supply further to bolster prices.

The Organization of the Petroleum Exporting Countries is holding talks on whether to hold an emergency meeting to address this year's drop in prices, Algeria's energy minister said on Saturday.

"Prices sank to quite low levels last week so the market is expecting some sort of reaction from OPEC," said Tobin Gorey, an analyst at Commonwealth Bank.

"It is possible that they (OPEC) will announce more cuts, I wouldn't rule that out, but what the market is going to be impressed by is compliance with the cuts."

U.S. crude rose 46 cents to $53.45. Brent crude, which expires on Tuesday, was up 63 cents to $53.58.

Floor trading at the New York Mercantile Exchange is closed on Monday for Martin Luther King Jr. Day, but electronic markets remain open.

Oil's slide this year as mild weather in the United States curbed heating fuel demand is worrying OPEC, which has been cutting supply since November to stem crude's drop from a record high of $78.40 hit in July.

Algerian Energy and Mines Minister Chakib Khelil said on Saturday OPEC members were consulting one another on whether to hold an emergency meeting to discuss the declining prices.

"There are consultations, but no consensus for the moment (on whether to hold one)," Khelil said.

A senior Iranian oil official echoed Khelil's comments on Sunday and said on the Oil Ministry's Web site that there was "still no official decision on whether to hold an emergency meeting soon."

OPEC pledged to lower supply by 1.2 million barrels per day from Nov. 1 and by a further 500,000 bpd from Feb. 1.