Crude Oil Rises More Than $2


Crude oil rose more than $2 a barrel on signs that the Organization of Petroleum Exporting Countries may cut output to halt a 50 percent drop in prices since July.


OPEC may pare production by 1 million to 2 million barrels a day in stages at an Oct. 24 meeting to stabilize prices, said Chakib Khelil, the group's president. Deutsche Bank AG lowered its 2009 crude-oil price estimate by 35 percent to $60 a barrel, citing the possibility of a ``major world recession.''

Crude oil for November delivery rose $2.40, or 3.3 percent, to settle at $74.25 a barrel at 2:45 p.m. on the New York Mercantile Exchange. Prices are down 16 percent from a year ago.

U.S. stocks rose, adding to the Dow Jones Industrial Average's best weekly gain in five years, after Halliburton Co.'s profit topped estimates and Federal Reserve Chairman Ben S. Bernanke endorsed an economic stimulus package.

OPEC, supplier of about 40 percent of the world's oil, brought forward to this week a Vienna meeting planned for November to discuss output levels.

While there's a consensus among the group's members to cut output, there's no agreement on the size of the reduction, Khelil, who is also Algeria's oil minister, said in an interview on Algerian television yesterday.

Qatari Oil Minister Abdullah bin Hamad al-Attiyah told Al Jazeera TV the cut will probably be 1 million barrels a day. Saudi Arabia, which dominates OPEC proceedings as the group's largest producer, has yet to comment on its intentions.

Regular gasoline, averaged nationwide, declined 3.1 cents to $2.923 a gallon, AAA, the nation's largest motorist organization, said today on its Web site. Pump prices have tumbled 29 percent from the record $4.114 a gallon reached on July 17.

Brent crude oil for December settlement rose $2.43, or 3.5 percent, to settle at $72.03 a barrel on London's ICE Futures Europe exchange.


TradingEconomics.com, Bloomberg
10/20/2008 1:35:16 PM