The Organization of Petroleum Exporting Countries, implementing its biggest ever supply cut, will devise a solution” to boost oil prices when it meets on March 15, Iran’s oil minister said. Crude has fallen 11 percent since climbing to $45.22 a barrel on Feb. 26 after data releases showed the U.S., Chinese and Japanese economies are contracting.
Crude oil for April delivery advanced as much as 90 cents, or 2.2 percent, to $41.05 a barrel on the New York Mercantile Exchange. It was at $40.72 at 11:42 a.m. London time.
The dollar declined to $1.2595 per euro as of 11:43 a.m. in London from $1.2578 late in New York yesterday.
Yesterday, futures plunged $4.61, or 10 percent, to settle at $40.15 a barrel, the biggest one-day drop since Jan. 7, after global equity markets slumped on reports of manufacturing declines in China and the U.S. Prices are down 9.3 percent so far this year.
Oil may fall as low as $32.70 a barrel if prices today close below the highest level reached in 1990 before the conflict between the U.S. and Iraq, according to technical analysis by PVM Oil Associates Ltd. On Oct. 10, 1990, oil rose to $41.15 as the U.S. prepared its military response to Iraq’s invasion of Kuwait.
Brent crude oil for April settlement was at $43.04 a barrel, up 83 cents, on London’s ICE Futures Europe exchange at 11:43 a.m. London time. It declined 8.9 percent yesterday.
U.S. oil supplies probably rose last week as imports climbed and refineries ramped up operating rates, a Bloomberg News survey showed.
Crude-oil stockpiles increased 1 million barrels in the week ended Feb. 27 from 351.3 million the week before, according to the median of eight estimates by analysts. The Energy Department is scheduled to release its weekly report tomorrow at 10:30 a.m. in Washington.
Refineries probably operated at 81.9 percent of capacity, up 0.5 percentage point from the week before, the survey showed.
Gasoline stockpiles probably dropped 750,000 barrels from 215.3 million in the prior week, according to the survey. Supplies of distillate fuel, a category that includes heating oil and diesel, probably fell 1.35 million barrels from 141.6 million.