http://www.google.com/hostednews/afp/article/ALeqM5iCNaJL7WDEg3URORTGLY3KjL8fzQ
At the same time, the International Energy Agency (IEA), which represents oil consumers, warned that a further cut in output would accelerate the global economic crisis.
"Another cut risks being a step too far," in view of the "catastrophic economic news over the past few months," chief IEA analyst David Fyfe warned in comments to AFP.
OPEC's recent production cutbacks, taking 4.2 million barrels out of the market every day, were likely to tighten the oil market, Fyfe said.
And that "would risk a surge in prices: the last thing the economy needs at present."
Oil producers do not agree, however. And in its latest monthly report, OPEC said that the worldwide recession was already leading to a slump in demand and that prices were therefore likely to continue to slide.
"With continued economic deterioration and demand erosion as well as the impending low demand season, there is likelihood of renewed pressure on prices," the cartel said Friday.
"The world economy is in a dreadful situation with GDP (gross domestic product) sliding into the red for the entire year of 2009. Consequently, world oil demand is slipping steeply to a record low year-on-year."
Quote from InvestVision:
http://biz.yahoo.com/ap/090313/oil_prices.html
Nigerian and Qatari officials have suggested they oppose another production cut on top of the 4.2 million barrels a day of reductions announced by OPEC since September, while Venezuela supports further cuts.
Russian news agencies said Thursday that Vice Premier Igor Sechin would attend the OPEC meeting in Vienna and that his country supports the idea of trimming production.
"It seems to be hard for OPEC to reach consensus this time," said Christoffer Moltke-Leth, head of sales trading at Saxo Capital Markets in Singapore. "I expect a small cut, less than the market expects."
Most analysts are expecting a cut of between 500,000 and 1 million barrels a day.
"Unless there's a massive OPEC cut, it's well-capped at $50," Moltke-Leth said. "We've seen it in black and white with China's terrible export numbers. That's a lot of demand destruction."
Traders were also waiting for Friday's reports on global demand expectations by OPEC and by the International Energy Agency in Paris.
