The Organization of Petroleum Exporting Countries, which pumps 42 percent of the world’s oil, will probably lower output targets by at least 2 million barrels a day, or 7.3 percent, at a Dec. 17 meeting in Oran, according to 18 of 33 analysts surveyed by Bloomberg. Oil gained 13 percent last week, its biggest five-day gain in four years, on speculation production cuts will revive prices.
Crude oil for January delivery rose as much as $2.72, or 5.9 percent, to $49 a barrel in electronic trading on the New York Mercantile Exchange. The contract traded at $48.53 at 1:10 p.m. London time.
OPEC President Chakib Khelil said today all the group’s members support an oil production cut at this week’s meeting. Khelil, who is also Algeria’s oil minister, said he is confident Russia will act to support OPEC’s reduction.
OPEC is asking Russia, the largest producer outside the group, to cut oil output by between 200,000 and 300,000 barrels a day to help revive prices, OAO Lukoil Chief Executive Officer Vagit Alekperov said in Moscow today.
Oil has fallen more than $100 a barrel from July’s record as the global economic slump cuts fuel consumption. World oil demand will fall this year for the first time since 1983, the International Energy Agency said last week.
China’s November crude-oil processing fell to a 15-month low as an economic slowdown cut demand. Refineries processed 27.27 million tons of crude last month, or 6.64 million barrels a day, the lowest since September last year, the China Mainland Marketing Research Co. said in a faxed statement today.
A report today will probably show industrial production in the U.S., the world’s largest oil consumer, contracted 0.9 percent last month as automakers cut output, according to a survey of economists. Sentiment among the largest manufacturers in Japan, the third-largest oil user, fell the most in 34 years, according to the nation’s quarterly Tankan survey today.
Brent oil for January settlement rose as much as $2.78, or 6 percent, to $49.19 a barrel on London’s ICE Futures Europe exchange. The contract expires tomorrow. The more actively traded February futures gained 4.5 percent to $51.31 a barrel at 1:10 p.m. London time.