The price of crude oil rose by more than 2% today on expectations that Organisation of Oil Producing Countries (Opec) ministers will not agree to increase their output when they meet in Vienna on Monday. The year-old Opec agreement to reduce oil production expires on March 31. On the back of falling inventories and growing demand oil prices hit an nine-year high earlier this month and this is raising fears that unless production is increased and prices fall the current world economic growth could be severely damaged.
There were indications from Opec officials yesterday that they are considering increasing output by between one and two million barrels a day. However, because they are already exceeding their current targets by one million barrels the maximum increase would be only one million barrels.
US Energy Secretary, Bill Richardson, has called for an increase of two million barrels from current production output. ‘The US hopes there will be a sizeable increase in production in a timely fashion,’ he said.