Oil prices retreated below $53 a barrel on Tuesday, as investors doubted OPEC's resolve to trim production and instead focused on the mild winter and high fuel stockpile in top energy consumer the United States.
US crude fell 61 cents to $52.38 a barrel by 0201 GMT, reversing the past two sessions' gains, which came as investors covered short positions in anticipation of an emergency OPEC meeting. London's Brent crude was down 52 cents at $52.60. „There could be some doubts about OPEC's resolve in cutting production so the market is paying more attention to weather and stocks instead,” said Gerard Burg, an analyst at National Australia Bank. Burg added that even if members in the Organization of the Petroleum Exporting Countries (OPEC) agreed to slash output further, the rise in oil exports from non-OPEC countries, such as Russia and Kazakhstan, would continue to provide substantial supply to the markets. Oil prices have dived 15% in the last two weeks on fund selling and mild weather in the US, touching a 19-month low of $51.80, before recovering slightly on Friday.
Alarmed by the falling oil prices, which have tumbled from record highs near $80 last July, OPEC has trimmed production twice since November and has said that it would slash output again if prices slide further Kuwait's oil minister, Sheikh Ali al-Jarrah al-Sabah, said on Monday OPEC may meet should prices fall further, though he preferred to wait until February 1, when the cartel's latest cutback of 500,000 barrels per day took effect. „We prefer to wait until February 1 to see the impact of the Abuja decision and member states may meet after that if the step does not stabilize oil prices,” he said. OPEC first pledged to implement a 1.2 million barrel cut from November 1, and later increased it to a 1.7 million cut from February 1, to shore up prices. Some ministers have previously said that prices should be kept above $60. Venezuela on Monday recommended an emergency OPEC meeting to reverse this year's „worrying” fall in oil prices, saying global markets are oversupplied by up to 1 million barrels per day. OPEC is next scheduled to meet on March 15 in Vienna. (Reuters)