VIENNA: OPEC ministers yesterday decided to “stay the course” and keep output steady as they put their hopes on a strengthening economy and tentative signs of increased demand to boost oil prices.
“Stay the course, this is the decision,” Saudi Petroleum and Mineral Resources Minister Ali Al-Naimi told reporters following just under two hours of talks, which had been widely expected to maintain existing production targets.
Some members of the 12-member Organization of Petroleum Exporting Countries voiced concern high levels of inventory could depress prices, but Naimi said demand was rising and would drain away excess supplies.
“The price is good, the market is in good shape, recovery is under way. What else could we want?” he said.
Oil prices jumped to a new six-month high yesterday as government reports showed that US consumers are spending money and fewer people are requesting first-time unemployment benefits.
Benchmark crude for July delivery traded up $1.91 to $65.36 a barrel on the New York Mercantile Exchange. Oil fetched as much as $65.42 a barrel earlier in the day, the most since Nov. 5.
In London, Brent prices rose $2.13 to $64.63 a barrel on the ICE Futures exchange.
Following its previous meeting in March, when prices were still below $50 a barrel and inventories were already very high, OPEC had signaled it was willing to live with prices around that level while the world economy gathered strength.
The mood of the May meeting was much more upbeat.
“I believe that the spirit of our final communiqué is sending a signal of optimism that all members of the organization are currently feeling,” Angolan Oil Minister Jose Botelho de Vasconcelos, who is also OPEC president, said.
The United States, the world’s biggest economy and biggest energy consumer, has cautioned too high an oil price could be financially painful. Obama and Custodian of the Two Holy Mosques King Abdullah are expected to discuss oil prices at a meeting next week in Riyadh.
