- LONDON: OPEC member Qatar has joined Mexico in taking out an insurance policy against falling oil prices next year, hedging some of its oil for 2012 as both nations adopt a cautious view about the global economy, the Financial Times reported.
Mexico hedges oil prices every year, but bankers said Qatar had taken out insurance only rarely over the last two decades, the paper reported.
Qatar hedged only a portion of its oil exports, with some brokers estimating about 200,000 barrels per day (bpd), a quarter of its annual oil output, the report said, adding no price was available for Qatar.
Qatar’s economic growth is expected to slow down sharply to 5.1 percent in 2012, from a projected 15 percent for this year as the country’s decades-long gas expansion program winds down, the Gulf state’s development planning authority GSDP said on Tuesday.
US oil edged up more than a percent to $91.23 a barrel by 0130 GMT. The prices have dropped 20 percent from a high of $114.83 hit in May.
Oil brokers said Mexico hedged the bulk of its net exports for the year, as it has done in the past, of around 800,000 bpd at a price of around $75 per barrel for the West Texas Intermediate crude, according to the report.
In one of the largest hedging programs in the oil market, Mexico’s finance ministry hedges a large chunk of its revenues from Petroleos Mexicanos (PEMEX) for the year ahead. In recent years, negotiations and pricing have been finalized sometime between September and November.