Venezuela’s Energy and Oil minister Rafael Ramirez anticipates that OPEC should leave production unchanged

Crude oil fell to a five-month low in New York and Brent oil in London dropped below 100 US dollars a barrel as traders remained confident that the OPEC meeting in Vienna would not decide to reduce production. Confidence followed Saudi Arabian and Venezuelan oil ministers’ statements saying Organization of Petroleum Exporting Countries will maintain production levels. The market is “well-balanced” said Saudi Oil Minister Ali al-Naimi. Venezuela’s Energy and Oil minister Rafael Ramirez also anticipated the group should leave production unchanged. Oil also fell as Hurricane Ike weakened and veered away from platforms in the Gulf of Mexico. Crude oil for October delivery fell 3.08, or 2.9%, to 103.26 US dollars a barrel at the New York Mercantile Exchange while futures touched 101.74 US dollars, the lowest since April 2, as prices fell for the seventh day in eight.Brent crude oil for October settlement declined 3.10 or 3% to settle at 100.34 US dollars a barrel on London's ICE Futures Europe, the lowest settlement price since April first. Futures touched 98.94, the lowest intraday price since March 25. The contract has dropped nine straight days. On average, crude prices have dropped 30% from a record 147.27 US dollars on July 11. “We have worked very hard since June's meeting to bring prices to where they are now'' said al-Naimi upon arrival in Vienna. “We have been very successful”. Saudi Arabia, the world's largest oil producer, pledged to raise output by 500.000 barrels a day through June and July to calm prices. It hosted an emergency meeting of oil producers and consumers in June to discuss how to stabilize markets. As important were Mr. Ramirez comments that “Venezuela will support leaving production unchanged” at today's meeting in Vienna. He added that “stocks are at a comfortable level and we're seeing an overproduction of 1 million to 1.5 million barrels a day”. Ramirez called for stricter compliance with production quotas to counter a potential gain in stockpiles in the first quarter next year. “History has shown that if inventories rise above normal levels, we will have a price collapse”. He added the market was reaching certain “equilibrium” at about 100 US dollars a barrel, but anticipated an additional meeting before OPEC summit December 17 in Algiers.