The Organization of the Petroleum Exporting Countries agreed
on Wednesday to keep its production target unchanged at 30 million
barrels per day for the first half of 2014.
The cap came as Iraq and Iran, the group's second and third biggest
producers, also made it clear they had no interest in contributing
to any collective cut next year.
"OPEC decided to keep its production ceiling unchanged, despite lots
of market talk about a supply glut in 2014. That could add pressure
on Brent," said Victor Shum, vice-president of energy consultancy
IHS Energy Insight.
Brent crude for January delivery was 27 cents lower at $111.61 a
barrel at 0354 GMT. It lost 74 cents the previous session, after
first breaking past $113 a barrel to its highest since Sept. 12,
then falling back after the OPEC agreement.
U.S. crude was 14 cents higher at $97.34 a barrel, after gaining
more than 5 percent over the past four sessions.
Oil investors will keep a close eye on U.S. third quarter GDP
numbers due at 1330 GMT and the November jobs report due Friday for
signs of improvement in the world's largest economy.
Data on Wednesday showed U.S. private employers added 215,000 jobs
to their payrolls last month, the biggest increase in a year,
leading to speculation payrolls could also be upbeat and perhaps
prompt the Federal Reserve to start curbing its bond buying
program at its next meeting Dec. 17-18.
The Fed's monetary stimulus has helped improve liquidity and
supported risk-assets such as oil and other commodities.
While OPEC's decision to keep its production target was widely
expected, Wednesday's meeting in Vienna revealed the group could
face problems agreeing on a production cut next year should it be
needed. Members Iraq, Iran and Libya plan to raise output
regardless, they said.
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Iranian Oil Minister Bijan Zanganeh said Iran will bring back
production once sanctions are lifted, following an interim deal. He
also named seven Western oil majors Iran would want back and said
Tehran would outline investment terms in April next year.
"Under any circumstances we will reach 4 million bpd even if the
price falls to $20 a barrel," said Zanganeh. "We will not give up on
our rights on this issue."
Adding pressure on Brent, Libya's oil minister said he hopes to
reopen all oil ports blocked by protests over political and
financial demands on Dec. 10, and resume full production about a
U.S. crude rose more than a dollar overnight after the country's
crude stockpiles dropped for the first time in 11 weeks.
Data from the Energy Information Administration showed crude stocks
fell 5.6 million barrels in the week ended Nov. 29, cutting around
one-sixth of the 36 million barrels that had built up over the
previous 10 weeks.
[By Jacob Gronholt-Pedersen © 2013 Thomson Reuters. All
(Editing by Tom Hogue)
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