Oil steadies above $100 ahead of OPEC meeting

Oil steadied above $100 on Wednesday as OPEC ministers indicated they were likely to keep output unchanged despite U.S. calls for action to reduce crude prices.

U.S. light crude for April rose 67 cents to $100.19 a barrel by 0920 GMT. On Tuesday, it fell nearly $3 to close at $99.52 as some investors tried to take profits from a record high of $103.95 struck on Monday.

London Brent crude climbed 61 cents to $98.13.

The market has kept a close eye on Wednesday’s meeting of the Organization of Petroleum Exporting Countries (OPEC) in Vienna to see how the producer group will react to the recent rally in oil prices to triple digits.

The group accounts for about a third of world oil output.

Remarks so far from OPEC ministers ahead of the meeting suggest the producer group is likely to leave output unchanged.

U.S. President George W. Bush warned on Tuesday it would be a “mistake” for OPEC ministers to ignore the pain record-high oil prices are inflicting on the United States, the world’s top energy consumer.

Robert Laughlin with MF Global said in a research note: “I expect OPEC members will ignore his call …especially having seen yesterday’s price action. The key will be a unified communique.”

Saudi Arabia’s Oil Minister Ali al-Naimi, OPEC’s most influential voice, said in remarks published on Wednesday he saw no need to change production because oil market fundamentals were steady and “healthy”. He blamed record high prices on “tremendous speculation”.

OPEC’s President Chakib Khelil of Algeria also told Reuters on Wednesday he expected output policy to stay unchanged.

The market was likely to shift its focus to the U.S. weekly oil data later in the day.

The data was expected to show a 2.4 million barrel rise in crude inventories, the eighth straight week of gains, and a 900,000-barrel increase in gasoline stocks that are already at a 14-year high. (Reuters)