Second OPEC Increase In Pipeline

[chlamor]

March 17, 2005

Second Opec increase in pipeline
By Rhys Blakely, Times Online


Opec is considering ramping up crude production by a further 500,000 barrels per day only days after its last output hike in an increasingly urgent effort to calm the soaring oil markets.The price of oil today hit a fresh high of $57 a barrel in New York while the cost of Brent crude in London passed $55 for the first time.


The oil producers' cartel has already agreed to lift its output ceiling by 500,000 bpd this week from 27 million to 27.5 million bpd after a ministerial meeting in Iran.

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This week's increase in official production levels by Opec had been widely anticipated. Analysts doubted that the move would calm the markets because Opec member states were already breaking their own quota limits by around 700,000 bpd.

Traders have argued that global oil demand, fired by China's explosive economic growth, is likely to dictate future price levels. Last week, the International Energy Agency raised its oil demand growth forecast for 2005 by 290,000 bpd to 1.81 million.

http://business.timesonline.co.uk/article/0,,9072-1529679,00.html