Members of OPEC are holding consultations over the oil market in light of the Libyan turmoil, Kuwaiti Oil Minister Sheikh Ahmad Abdullah al-Sabah said yesterday.
“We are in consultation but have not yet decided which direction,” we are heading, he told reporters when asked if OPEC was discussing whether to raise crude production.
Al-Sabah also denied that Kuwait, OPEC’s fifth largest producer, has increased production.
“We did not increase,” he said.
Crude oil prices surged on Monday as traders fretted about escalating clashes in Libya between forces loyal to leader Muammar Qaddafi and rebels seeking to end his four-decade rule.
In Asian trade yesterday, New York crude prices fell below US$105 as the US refused to rule out tapping its oil reserves to ameliorate the impact of high oil prices.
New York’s main contract, light sweet crude for delivery next month, fell US$0.70 to US$104.74 per barrel in the afternoon.
Brent North Sea crude for delivery next month shed US$0.64 to US$114.40.
Crude markets were depressed by White House chief of staff William Daley’s comments on Sunday that the US had not ruled out tapping its strategic oil reserves in the face of spiking prices, said Ong Yi Ling, investment analyst for Phillip Futures in Singapore
“The US government is considering tapping its oil reserves, so that could limit some of the upside for oil,” she said.